How to claim travel expenses on your German tax return
The reason so many people choose to submit a tax return in Germany, even if they are not obliged to, is so that they can reduce their tax bill by taking advantage of deductions. One of the easiest deductions you can make is for your travel expenses to and from work. wundertax explains how it’s done.
Travel expenses for professional-related commutes can be claimed by taking advantage of the commuter allowance (Entfernungspauschale) on your German tax return and help increase your chances of a tax refund.
While some expenses are deducted as a set sum (e.g. per kilometre travelled), others can be deducted in full (e.g. the cost of tickets). Traditional employees can deduct these costs as income-related expenses (Werbungskosten) while freelancers / self-employed people can claim their travel expenses as business expenses (Betriebsausgaben). In this article we will be focusing on:
- Expenses for the commute from your residence to your primary workplace
- Travel costs for external activities and business trips
1. Deducting expenses for your work commute
You can claim a commuter allowance for commutes between your residence and primary workplace (erste Tätigkeitsstätte). This allowance amounts to 30 cents per kilometre for the first 20 kilometres of one-way travel to or from your workplace, regardless of means of transportation or actual incurred expenses.
That means this can be claimed whether you walk, ride a bike, drive a car, ride as a passenger, or take public transportation. The tax office will only accept deductions for the shortest possible route.
As of January 2021, the commuter allowance was increased to 35 cents from the 21st kilometre of one-way travel for long-distance commuters and from 2022 to 2026 it will be increased again to 38 cents from the 21st kilometre of one-way travel.
Is there a limit to the commuter allowance?
Generally, the tax office accepts 230 trips per year, but if you have a six-day work week you can claim up to 280 trips per year. Commuter expenses cannot be deducted for days spent home sick, on vacation, or working from home – days spent working from home can instead be claimed using the Home Office Lump Sum.
A maximum of 4.500 euros per year can be deducted with the commuter allowance. However, if you meet one of the following two exceptions, you should hang on to receipts as proof for the tax office:
- If you commute to work in your own personal or business vehicle you can claim more than 4.500 euros per year.
- If you commute to work by public transportation and the costs exceed 4.500 euros per year, you can enter and claim the actual expenses on your tax return.
Commuter costs for multiple workplaces
You can only have one primary workplace per employment role. If you work at several locations, this is considered external activity (Auswärtstätigkeit) and treated differently.
Rather than claiming a lump sum per kilometre, if you commute to external activities by public transport, you can have your actual expenses reimbursed (e.g. the cost of your tickets). If you travel by car, you can take advantage of the kilometre allowance (Kilometerpauschale). This applies to both the outward and return journey and amounts to 30 cents per kilometre.
If you have several different jobs in different locations, however, you can claim the commuter allowance for each primary workplace, so long as you travel home in between. When travelling from primary workplace to primary workplace, the distances can be added together, but then the commuter allowance can only be used for half of the total distance.
Mobility premium for long-distance commuters
As of 2021, long-distance commuters with a daily commute of 21 kilometres or more can apply for the new mobility premium (Mobilitätsprämie), which grants a bonus of 14 percent of the increased commuter allowance from the 21st kilometre of one-way travel.
To apply for this premium, your annual income cannot exceed the basic tax-free allowance (Grundfreibetrag), which amounts to 9.744 euros as of 2021. As of 2022, the basic tax-free allowance increased to 10.347 euros.
You can apply for the mobility premium in your tax return, and if you meet the requirements, it is transferred directly to your bank account. The assessment basis for the premium varies depending upon the difference between your annual taxable income and the basic tax-free allowance.
2. Costs for business trips
If you travel for work for any purpose including field services, further education, and trade fair visits, it’s recommended to claim the resulting expenses on your tax return (provided your employer didn’t already cover them). Your means of transport are irrelevant unless you’ve travelled in a company car, which is not tax-deductible.
Expenses for travel by public transport, ship, or aeroplane are all reimbursed in full so long as you travelled in the lowest class available. Train journeys in the next class up can be reimbursed if the travel time exceeds two hours.
If you travelled by car, you can either determine the actual incurred costs and claim them or use the kilometre allowance (Kilometerpauschale). Unlike the commuter allowance, the kilometre allowance can be applied to both the outward and return journeys.
Per kilometre travelled, the kilometre allowance amounts to:
- 30 cents for trips by car
- 20 cents for trips by motorcycle, scooter, moped, or e-bike
If your employer covered a portion of your business trip expenses, you have two options: You can either deduct the amount from the total expenses or you can write off the employer subsidies on your tax return.
If your business trip away from home and your primary workplace exceeds 8 hours, you can claim a flat rate of 14 euros for meals (Verpflegungsmehraufwand). If the trip exceeds 24 hours, you can claim a flat rate of 28 euros.
The rules surrounding commuter costs and other travel expenses can be complicated. wundertax helps you complete your tax return in as little as 17 minutes, while giving tips on deductible costs, so you can maximise your refund. Get started now.