Working from home: This is what you can claim on tax
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2020 has brought about many changes and with a lot of companies having to close their offices, working from home has become a new normal for employed and self-employed workers alike. And it looks like this trend is here to stay: The federal ministry of labor in Germany has proposed a law that would give employees the right to occasionally work from home, pandemic or not.
So, it’s about time we take a look at some of the tax claims that are eligible when working from home. Can I deduct my home office? What about my power and internet bill? And can I claim expenses for work-related purchases on tax? Read on to find out what expenses for your home office you can deduct from tax.
Home office tax deductions in Germany
First things first: your home office. Generally speaking, you can deduct the costs for your home office from tax, but you do need to meet some criteria, the most important being that your office is a separate room inside your home. So your home office can’t just be your desk sitting in the corner of the bedroom, in your closet, or in the basement of your building. You can only claim the cost for a home office, if it is an actual room inside your home that is solely used for work purposes.
Secondly, you have to check if your home office is also your main place of work, meaning this is where you spend the majority of your time working. If you mainly work in an office or co-working space and only spend one or two days a week working from home, you may not be able to claim all of the cost related to your home office. In this case, you can only claim a total of 1.250€ per year, given that there is no other location than your home office where you can perform a certain task.
However, if your main place of work is your home office, you can claim the proportional rental expenses on your tax. Just make sure that you know the exact size of your home office and calculate the amount of rent you pay per m².
Power, heating, internet etc. – all tax deductible
If your home office meets the aforementioned criteria, you can also deduct the proportional other costs for your apartment. This includes your power and internet bill as well as any additional services included in your Nebenkostenabrechnung (auxiliary cost statement).
Again though, you can’t claim the whole cost, only the proportional amount broken down for the size of your home office. Also keep in mind that you – hopefully – don’t work 24/7, but usually 5 days of the week for specific times. So you are only allowed to claim the expenses for used power etc. within this time period.
Your home insurance
You can generally claim the costs for work-related insurances on your tax. This includes the cost for your home insurance, given that you mainly work from home and meet all of the above-mentioned criteria for deducting your home office. If that’s the case, you can claim the proportional cost of the home insurance for your home office.
Expenses for your home office
To be able to properly work from home, you will probably need some office supplies like folders, pens, staplers, or notebooks. All of these expenses are 100% tax deductible. You can even claim costs for toilet paper, as it is a relevant business-related expense when working from home!
If these costs exceed 800€, however, you might not be able to claim everything at once, but rather have to treat it as a depreciation and claim the costs over time. Make sure you keep all incoming invoices for business expenses, if you plan on including them in your income tax declaration!
💡 Tip from Accountable: Shoe boxes stuffed with paper receipts are a thing of the past! Our app allows you to save and organize all your invoices digitally so you can access them whenever and wherever you want.
Last but not least, you also need some proper office furniture to work from home. Therefore, you can claim the full expenses for desks, office chairs, monitors etc. on tax, given the accumulated costs are not higher than 952€ including VAT. If your expenses were higher, you have to divide the costs according to their approximate lifecycle, as declared by the German ministry of finance.
By the way, you can also deduct privately used items as a business-related expense if you use them for work purposes at least 10% of the time. In that case, you can claim the costs for e.g. your phone or your laptop proportionally to your work usage.
💡 Tip from Accountable: Whenever you are unsure if you can claim something on tax, simply ask our free “tax search engine” and find out all you can deduct! Type in the expense in question and get reliable results in the matter of seconds!