Numerous employees had to swap their office for their home study due to the Corona pandemic. But what must employees consider in the home office? Can consumers, for example, deduct the newly purchased office chair from taxes? We have examined the existing tax regulations more closely.
Income Tax Act: Legal requirements for a home office
As a rule, the study is subject to strict requirements under the Income Tax Act (§ 4 para. 5 no. 6b German Income Tax Act): It must be a separate room used 90 percent for professional purposes. This should belong to the private apartment and be equipped as an office.
The tax authorities usually adhere strictly to these requirements. However, the pandemic forced numerous employees to work from home at the beginning of the year without appropriate precautions. This was not a free decision for the individuals concerned. This will very likely lead to changes in tax law. Therefore, we recommend consumers to keep all relevant documents.
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Employees should definitely keep these invoices
Consumers should keep invoices for all work-supporting materials they have purchased for the home office. This includes furniture, for example, a new office chair or a laptop stand.
It is also advisable to keep all receipts for cleaning and renovation work during the home office period. Consumers should note that they must prove the newly acquired items or changes in the premises. We recommend taking before-and-after photos of the corresponding room.
Up to 1,250 euros tax refund with employer’s certificate
Which costs from the home office period consumers can definitely deduct for tax purposes is not yet legally clarified. However, if employees were unable to use the office from the employer’s side, a deduction of up to 1,250 euros may be possible for this period. In order for consumers to claim this refund, they need a certificate from their employer regarding the home office order.
If the information is not recognized by the responsible tax office, we recommend in any case to file an objection against the decision.
Other tax-deductible costs in the home office
In addition, rental costs during the time working from home as well as fees for electricity and media use, e.g., for WLAN and telecommunications, are partially deductible. The partial deduction of insurance fees and other charges is also possible. Purchases such as computers, printers, hardware and software, as well as technical literature, remain tax-deductible.
Of course, we are continuously incorporating all newly adopted changes into the Taxando service.
Up to nearly 7,000 euros tax refund per person with the Taxando app
Overall, our users were able to achieve tax refunds totaling 1,400,000 euros over the past three years. In 2019, consumers received the most money back (472,000 euros). The highest amount refunded per person was 6,802 euros, with the average sum being 1,370 euros per user.
These expenses are most frequently deducted
Costs for maintaining a second household as well as child allowances are among the expenses most frequently deducted by users of the Taxando app. In addition, users received refunds for other expenses, e.g., for the study or account management fees. Furthermore, consumers deducted travel to work, expenses incurred for professional travel activities, and insurance fees with the Taxando app.
Incidentally, employees of the German tax authorities are authorized to pay consumers unannounced home visits. Although they can be denied access to the apartment, this is not advisable. Additionally, the tax authorities often do not officially announce legal changes: these can only be found in unpublished decrees.
Maciej Wawrzyniak
In his private life, Maciej enjoys sporting challenges, playing the guitar, and swimming in the lake. He is also the proud father of three sons.
