Flat Rate Telephone Tax Deduction – How Can You Deduct the Costs Incurred?

In today’s world, we almost constantly use the phone at work – it is the main means of communication with colleagues, customers, or subcontractors. Modern technology also makes it an excellent source of information and a way for advertising – especially now, as working from home gains popularity. In Germany, you can deduct part of the telephone costs if they were business-related – in this article, you will learn how to do it!

Flat-rate telephone tax refund in the annual tax return – who can benefit?

To deduct costs for phone calls and internet access from taxes, you need proof that these services were used for business purposes. Your company can provide the necessary evidence. Other options include presenting invoices or an overview of the usage duration of these services. Remember, the correct evidence is extremely important – without it, a deduction is unfortunately not possible.

Telephone costs can be considered in the tax return in two ways:

• as a flat rate – 20% of the total costs are deducted – a maximum of 20 euros per month or 240 euros per year,
• with individual statements – part of the business-related costs must be proven, but there is no limit here.

Which costs for phone calls can be deducted from taxes?

As for the costs of phone calls, it is quite clear – there are no objections against deducting practically everything related to the phone. This includes all costs associated with calls and the device itself. The tax-deductible costs for phone and internet include:

• Basic fees,
• Flat-rate costs,
• Fax charges,
• Internet costs,
• Rental costs for equipment,
• Purchase costs for equipment,
• Connection costs.

How can you use the flat rate for the phone?

A big advantage of the flat-rate telephone tax deduction (tax phone flat rate) is the convenience – it is not necessary to prove the exact extent of the business use of one’s phone. However, this often means a lower deduction amount, as the maximum in this case is 20 euros per month or 240 euros per year – this means that your phone or internet bill would have to be 100 euros per month to reach the maximum amount.

However, it should be noted that despite the lack of the necessity to prove the exact costs, the basic requirement exists – that business calls were made with the private phone.

How to calculate the flat-rate telephone tax amount?

To calculate the deduction amount, the costs of three months are used and extrapolated to the whole year – it is best to choose the months with the highest expenses to achieve the highest possible average. This is best illustrated with an example.

Let’s assume the phone and internet bills were highest in the months of March, April, and May.

Total of the three bill amounts: 50 € + 43 € + 56 € = 149 €

149 € / 3 months * 20% = 9.93 €

9.93 € * 12 months = approximately 119.16 €.

A sum of 119.16 euros can thus be deducted in the tax return, as it does not exceed the specified limit of 240 euros.

Flat-rate Internet and telephone amount for self-employed

For self-employed individuals, there is the possibility to claim a tax deduction for the costs of phone and internet incurred for business purposes. The procedure is similar to that applied to employees. These costs can be stated as business expenses in the tax return.

However, it is necessary to separate private from business calls. If this separation is clear, the calculation does not pose a major challenge. If it is not, call records for three months must be provided to prove eligibility for the deduction.

Flat-rate allowance for income in Germany

In Germany, there is also the possibility to deduct other work-related expenses – the employee flat-rate is a fixed amount that is automatically deducted from the annual salary in the context of the tax return. This applies to both employees and the self-employed.

It is important to note that this privilege can only be claimed for unlimited tax liability. To achieve this, one must live and work in Germany for at least 183 days a year. Only then can other advantages be utilized, such as joint taxation with a spouse, child allowances, or health deductions.

Even with low business expenses, this fixed amount is deducted, reducing the tax burden. This makes the tax return more advantageous. With higher expenses, these can be individually proven – this could lead to a higher deduction amount, but requires evidence of all costs (receipts, tickets, invoices, etc.).

Flat rates and tax reductions are usually calculated automatically, but flat-rate phone costs must be considered in the declaration itself. In such cases, a German tax software program, such as Taxando, is helpful.