What you can deduct from the tax

Many people work from home during the corona pandemic – even though they don’t have a proper office. Now a new package should come. How to properly claim the home office at the tax office.

2020 is a year full of challenges – also with the tax return. Almost overnight, thousands of companies sent massive numbers of workers to work from home. But only very few employees are likely to have a home office that meets the strict requirements of the tax office. That is why new rules should apply in the Corona year.

Financial politicians from the Union and the SPD have Agree on a new home office flat rate of five euros per day, up to a maximum of 600 euros per year. The Federal Council had previously proposed that the 2020 Annual Tax Act also recognize expenses for home office.

In the meantime, it has also been clarified how the flat rate may be applied. The law has yet to be passed by the Bundestag and Bundesrat. We provide an overview of how the Annual Tax Act will continue and what currently applies to offices and taxes.

Corona home office: who can set off a study?

Despite the strict requirements, more people are already allowed to leave a study than was the case before the Corona crisis. So far, the tax offices have generally only recognized it for those employees who obviously cannot do all professional tasks at their workplace. These include, for example, teachers, foresters and field staff.

However, if you had to work from home because of the pandemic, the tax authorities will also allow you to deduct tax this year – provided all of the following three conditions are met:

  1. The boss must have arranged the home office. A request or recommendation is not enough.
  2. The study must be an enclosed space. The kitchen table, work area in the living room or the desk in the shared room are not sufficient.
  3. A maximum of 9 percent of the spatially separate study may be used privately. A sofa bed for guests can already be an exclusion criterion.

Tip: Take photos of your study at different times so that you can submit them to the tax office if necessary.

How can I set off a study?

If you meet all the requirements, calculate the costs for the study proportionately.

  • Example: If you live in a 100 square meter apartment and your study is 10 square meters, include 10 percent of the rent and ancillary costs such as electricity or insurance on your tax return.

In order to be able to fully deduct this share, it is sufficient if you work at home three out of five days. You can also claim all expenses for the renovation and furnishing of the study, e.g. for wallpaper, curtains and lamps. If you work from home for a maximum of two out of five days, you can deduct a maximum of EUR 1,250 per year from tax.

Good to know: For couples who share a study, each can claim their costs up to 1,250 euros. The Federal Fiscal Court reorganized this in 2017.

What can I set aside without a study?

Even those who do not have a tax-approved office can claim job costs from the tax office. These so-called advertising costs include work equipment such as office supplies, a new laptop, desk, office chair or bookshelf, but also costs for further training.

If you had to leave your workplace or home office for the training course, there is also a meal allowance. You may also be able to claim accommodation costs.

Telephone costs can be deducted at a flat rate of 20 percent, up to a maximum of 20 euros per month. If your actual costs were higher for professional purposes, you have to prove this with individual receipts – and therefore note down the name of the person you are talking to, telephone number and reason for the conversation.

What applies if the home office flat rate comes?

The Union and the SPD finally agreed on how the planned home office flat rate should be designed in concrete terms. The lump sum should amount to a spokesman for the CSU regional group 600 euros per year. The SPD side had previously spoken of 500 euros.

It is therefore now also clear that the home office flat rate is included in the so-called advertising cost flat rate and is not granted in addition. Due to the corona pandemic, the regulation should initially be limited to two years.

Home office flat rate is intended to cover costs for electricity and internet

The lump sum of 1,000 euros is deducted from income in the tax calculation for expenses that arise in connection with the job, such as travel expenses to work, work clothes or further training (so-called advertising costs).

This reduces the tax burden. Anyone who has particularly high advertising costs per year so that the lump sum is exceeded, for example due to a long commute, must claim this.

The home office flat rate promotes costs such as electricity, telephone and internet, said CSU regional group leader Alexander Dobrindt. “In this way we are relieving those who have achieved enormous things from home during the pandemic and are consistently aligning tax law to the modern world of work.” SPD parliamentary group vice-president Achim Post said that employees who work in their own four walls could now more easily claim their costs for tax purposes.

Time for annual tax law is pressing

In September, Hesse and Bavaria had already advocated a home office flat rate of 600 euros in the Federal Council. Every employee should be able to dispose of them – regardless of whether there is a locked office or whether the boss has ordered the home office.

The Federal Council agreed to this demand at the end of October; now the federal government has also agreed. Time is of the essence, however: The annual tax law has to be announced in the Federal Law Gazette in December – and there are no longer many days of meetings of the Bundestag and Bundesrat.

How is the new home office flat rate received?

Thomas Eigenhaler, who as head of the German Tax Union represents the interests of employees in the tax offices, welcomes the agreement on a home office flat rate in principle, but is concerned about the daily crediting. “A monthly flat rate of 50 euros would have been less bureaucratic,” he said in an interview with t-online.

Also that the lump sum should be treated like other advertising expenses, Eigenhaler considers to be correct. “It is precisely the function of a flat rate that the real expenses are absorbed in it. Anything else would be unsystematic in terms of taxation.”

The taxpayers’ association (BdSt) also considers the planned home office flat rate to be a step in the right direction. “Employees who work at home and therefore fall back on private resources must receive a tax compensation. The tax law must recognize this as well as the distance allowance,” said taxpayer president Reiner Holznagel t-online. 5 euros a day is a good approach; However, the taxpayers’ association had always come out in favor of a monthly flat rate of 100 euros, i.e. 1,200 euros per year.

Bonus from the employer: From March to December this year, bosses can support their employees with a corona allowance. Up to 1,500 euros extra remain tax and social security-free – whether as a contribution to the salary or as a contribution in kind. However, the employer is not obliged to do so.

What does home office mean for the commuter flat rate?

That is the downside of the relief: If you claim costs for the home office, you cannot also benefit from the distance flat rate for these days. After all, he could only have been either home or on his way to work. Both are not possible together.

What applies to employees who bought an annual bus and train ticket at the beginning of the year has not yet been conclusively clarified. So far, this could be completely deducted, but there may be cuts in the 2020 tax year.


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