Are shipping costs tax deductible

Advertising expenses

What employees can deduct

Udo Reuss
Tax Expert As of March 24, 2021

Udo Reuss

The tax lawyer and business graduate Udo Reuß is responsible for tax issues at Finanztip. Before that, he worked for various business and specialist publishers such as Handelsblatt, F.A.Z.-Verlagsgruppe, Haufe-Lexware and Vogel Business Media - 14 years of which he worked as editor-in-chief of trade magazines. He draws the relevant judgments for tax savers from the complex tax law.

  • Advertising costs reduce your tax burden on your income as an employee.
  • Advertising costs include all costs that you incur through your work.
  • The tax office takes into account a lump sum of 1,000 euros for employees.
  • This ABC of income-related expenses lists numerous Tax saving opportunities on. Check which items you have incurred. In addition, ours will help you Checklistwhich you can download below.
  • If you have spent more than 1,000 euros in advertising expenses in a year, you can only get back taxes that have been paid too much by providing detailed information in Appendix N of your tax return.
  • Landlords can also deduct advertising expenses from their income. Investors, on the other hand, only benefit from the saver lump sum.

The advertising expenses include all amounts that you spendto at all to earn money. This includes application photos as well as the drive to the interview. If you already have a job, you may need to invest in training to keep it. You can stop all professionally motivated Expenses that your employer has not reimbursed you for tax-free. The employer already takes into account a lump sum of 1,000 euros for employees when deducting income tax.

If your income-related expenses do not exceed this amount per year, you can forego entering individual expenses in Appendix N of your tax return. Because 1,000 euros the tax office automatically takes into account for every employee.

Checklist for advertising expenses

You can use our checklist to check which Advertising expenses have accrued to you.

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Advertising expenses from A to D

Work equipment- Everything that you use for your professional activity is considered work equipment. In principle, any item can be a tax-deductible work item if you use it at least 10 percent for uses professional purposes. These include, for example, briefcases, PCs, desks, office chairs that you have paid for yourself, bookshelves and specialist literature.

You can with one mixed-use work equipment claim the professional share. At a computer the tax office accepts a 50 percent share without further evidence. For example, if you occupy three quarters of a bookshelf with specialist literature, then you can set 75 percent as advertising costs; with at least 90 percent even the entire acquisition costs. However, if there is no correct standard of apportionment, the tax office will probably not allow the tax deduction. This applies, for example, to corona masks that you also have to wear at work and have paid for yourself. Still, you can try.

If the work equipment is considered to be of low value, you can pay the costs stop immediately. For purchases from 2018 onwards, this applies to work equipment that has a net maximum of 800 euros or 952 euros including 19 percent VAT. For purchases made by the end of 2017, the value is 410 euros net or 487.90 euros gross.

If the work equipment was more expensive, you have to keep it for its useful life copy. For example, 13 years applies to furniture and 3 years to a computer. Note that you have to write off exactly to the month in the year of purchase. Computers, peripheral devices (printer, camera, keyboard, mouse, external hard drive, etc.) and software purchased from 2021 can be completely written off within one year.

Workspace- It is difficult for most taxpayers to deduct the cost of a home office. In principle, there is a prohibition of deduction for these costs. However, the legislature allows two exceptions: If no other job is available for your professional or operational activity, you can claim up to 1,250 euros per year. If the study is the focus of your entire professional or operational activity, your costs are fully deductible. However, there are strict requirements: It must be a lockable, office-like room that you can use at most 10 percent privately.

Bahncard- Have you bought a Bahncard to reduce your travel expenses for work? Then you can deduct the professional part of the price as advertising expenses.

Vocational education and training- You can only deduct the costs of your own first-time vocational training or your first degree up to a limited amount of 6,000 euros per year as special expenses. They count as training costs.

On the other hand, you can take into account unlimited expenses as income-related expenses if they

  • for further vocational training,
  • for another degree (second degree),
  • for a first degree after completing non-academic vocational training or
  • arose within the framework of a training contract.

Because they count as training costs. If you are doing an apprenticeship, your professional expenses count as normal income-related expenses.

Workwear- The tax offices recognize expenses for typical work clothes and their cleaning as business expenses. This includes, for example, the work smock, uniform, boiler suit, safety shoes, doctor's coat, surgical trousers, robe and beret of a judge and the official costume of a clergyman. All items of clothing that you can use as conventional "civil" clothing, on the other hand, are not typical work clothing.

Professional association- Your contributions to professions and other professional associations, for example the medical or bar association, but also trade unions are also deductible.

Applications- If you are looking for a job, you can, for example, deduct expenses for advertisements, telephone costs, postage, costs for photocopies of certificates and non-reimbursed travel expenses for interviews. It does not matter whether your application was successful.

PhD- The tax office recognizes doctoral costs as income-related expenses if they are professional. The costs of a habilitation also count as income-related expenses.

Double housekeeping- Anyone who maintains a second household at the place of employment for professional reasons can deduct their expenses from tax as income-related expenses within the framework of double housekeeping. The tax office takes into account the costs of the second home, travel expenses, additional meal expenses (within the first three months) and relocation costs.

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Advertising expenses from F to M

Technical literature - The ones needed professionally Specialist magazines and books you can deduct tax. Make a note of the title on the receipt so that you can dispel any doubts when you ask the tax office. As a rule, you cannot sell daily newspapers.

If you use a subscription almost exclusively for work, then the expenses count as advertising expenses. This result was achieved by a goalkeeping coach of a licensed football club who paid the costs of his Sky Bundesliga subscriptions was allowed to withdraw (Finanzgericht Düsseldorf, judgment of November 5, 2019, Az. 15 K 1338/19 E). He argued that he needed his Sky Bundesliga package to keep himself up to date professionally by watching Bundesliga duels. Initially, the tax court (FG) rejected the deduction of income-related expenses, the federal tax court saw it differently and instructed the tax court to re-examine the specific case. And over four years later, they agreed with the plaintiff.

Trips to work- The legislature supports your journeys between your home and your first place of work in the form of a flat rate. For this trip you can deduct a flat rate of 0.30 euros for each full kilometer as income-related expenses from the tax - regardless of how you get to work and back home. From 2021, a higher kilometer rate will apply for long-distance commuters. From the 21st kilometer you can apply 35 cents.

The flat-rate distance fee is generally limited to 4,500 euros per year. However, if you drive to work in your own car or a company car, the tax office will also consider a higher amount.

If you use public transport, you can also charge your higher actual costs instead of the flat-rate distance fee.

Celebration costs - The costs for a party with colleagues, superiors and business friends are tax-deductible if the party was at least partially due to work. In July 2015, the Federal Finance Court (BFH) decided that a tax advisor may deduct the expenses for a party with colleagues and personal friends (judgment of July 8, 2015, Az. VI R 46/14). He had invited 46 colleagues to pass his tax advisor exam in a rented hall and at the same time 55 people from his private environment on the occasion of his 30th birthday. He submitted the guest list to the tax office and wanted to deduct a proportion of the costs for rent and hospitality as business expenses. Both the tax office and the finance court of Baden-Württemberg rejected this; the BFH allowed this.

This taxpayer-friendly case law is now consolidated, as the BFH judgment of January 20, 2016, Az. VI R 24/15 shows. A tax officer who celebrated his 40th anniversary with his colleagues in the tax office sued. He invited all colleagues by email and was allowed to deduct the drinks and snacks he had ordered and paid for as advertising expenses. Because a service anniversary is a job-related event, the BFH has determined. The expenses for this can almost exclusively be business-related if the employee complies with the following conditions:

  • The employee acts as the host and determines the guest list.
  • Since the boundary between colleagues and private friends can be fluid, the business guests should not be invited individually, but according to an abstract criterion: for example, all colleagues, the entire department, all field workers, the senior citizens or trainees of the company, etc.
  • The celebration should take place on the employer's premises and ideally at least in part or on the edge of regular working hours, for example on Friday afternoons.
  • With regard to the effort, it should be kept within the usual framework. A champagne and wine drink with canapés is definitely included.
  • Differentiation from representation expenses: Anyone who invites relatives, personal friends, members of public life such as mayors, city councilors, journalists must know that these belong to the private sector and can at least partially object to their invitation to a professional cause. At least the part of the costs that is attributable to the business guests is deductible.

The occasion of the celebration is only one of several criteria. The overall picture decides whether and to what extent advertising costs are deductible. Employees can also have entertainment expenses.

If the employer pays the costs, he can sponsor up to 110 euros per participant free of tax and social security. Gifts up to 60 euros are included in this limit. If the company gives more than 110 euros per person, it has to pay wage tax and social security contributions.

Continuing education and training-You can deduct the full amount of professional training or further education costs as income-related expenses for tax purposes. This applies both to training measures in a profession that has already been practiced and to future employment (such as preparing a journeyman craftsman for the master craftsman's examination). Typical examples are courses, conferences and seminars.

Driving license- The expenses for a truck or bus driver's license are basically income-related expenses if you need them for work. In contrast, the cost of a car driver's license is part of a private lifestyle, even if you can only get to work by car.

Home office flat rate -If you work from home in 2020 and 2021 and do not meet the tax requirements for a study, you can benefit from the newly introduced home office flat rate. Accordingly, for every working day that you exclusively spend in the home office, 5 euros pull off. This trigger is on 120 days limited, so that you can deduct a maximum of 600 euros per year. However, the home office flat rate is offset against the flat rate for advertising expenses. Therefore, only employees who come with their total advertising expenses over 1,000 euros can benefit from it.

If you have a study, you can still deduct your study costs. Your co-living partner who only has a work corner can also claim the new home office flat rate. So you can combine that in the joint tax return.

The daily flat rate covers the additional expenses for the use of the apartment, in particular for electricity, heating and other room costs. ProfessionalTelephone and internet costs you can also withdraw. For this, there is a limit to 20 percent of the invoice amount without individual proof, up to a maximum of 20 euros per month.

Capital income- Since 2009, the state has levied a 25 percent flat tax on interest, dividends and other private investments. The actual advertising expenses are not deductible.

Account management - Business-related transactions (for example, the transfer of wages) also regularly take place on normal current accounts. For this reason, account management fees are proportionally deductible as income-related expenses. Here, a non-objection limit of 16 euros per year has prevailed. Most tax offices also take this amount into account for free checking accounts. The tax office does not require any receipts until then.

Credit card - You are sure to use your credit card for business expenses too. Then you should determine a percentage of professional usage. You can deduct the part of the cost that is attributable to professional use as advertising costs.

Master craftsman examination- Anyone who opts for advanced training to become a master can deduct their expenses as income-related expenses.

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Advertising expenses from R to Z

Legal advice- You can deduct your consulting costs and other legal costs (for example litigation costs) from tax if they are work-related. This is the case, for example, in a process before the labor court. For professional reasons, there is also a dispute before the tax court about wage tax or income-related expenses.

Traveling expenses- If you were traveling for professional reasons, you can deduct the costs that you have incurred as travel expenses from tax. Travel expenses include travel expenses, accommodation expenses, additional subsistence expenses and ancillary travel expenses. Typical examples of business trips are visits to seminars, customers or trade fairs.

Language course- If you take a language course that is specifically related to your professional activity, your costs can be deducted as income-related expenses. Just because the location of a language course is abroad does not necessarily mean that the course was mainly private. This applies at least to the member states of the EU, the EEA states (Iceland, Liechtenstein, Norway) and Switzerland.

Tax consultancy costs- If you hire a tax advisor, you can deduct the part of the costs that is caused by wages or salaries. The private area of ​​the tax return (e.g. main form, attachment child etc.) has been a private pleasure since 2006 and no longer has a tax-reducing effect.

phone- You probably don't use your landline or smartphone exclusively for work. You can divide your costs into an - estimated - professional and a private part. Most tax offices recognize 20 percent of the invoice amount, but not more than 20 euros per month, without individual proof. As a result, you can specify a flat rate of up to 240 euros per year. But you have no right to it.

retraining- If you take part in a vocational retraining measure, the costs you incur are income-related expenses.

move- Your moving costs are always deductible as business expenses if you can prove to the tax office that the change of residence was due to work. If you carried out the move in the predominant business interest of your employer (for example to a company apartment), you shouldn't have any problems with providing evidence. The same applies if you have started a new job in another location. A travel time saving of at least one hour a day speaks for a professional reason.

accident- If you have an accident on a work-related trip or on the trip between your home and your first place of work, you can deduct the cost of repairing the damage to your own and someone else's vehicle as well as any rental car costs. These costs are considered to be extraordinary expenses in the context of general advertising expenses (see pages 14 and 15 in the letter from the Federal Ministry of Finance dated October 31, 2013). Otherwise no other vehicle costs may be deducted in addition to the flat-rate distance fee, not even parking receipts for parking the car during working hours.

By the way: If the accident happens on the way to work and you have to pay medical expenses yourself, then these can be deductible as business expenses instead of just extraordinary expenses (BFH, judgment of December 19, 2019, Az. VI R 8/18). The same applies to treatment and travel costs to doctors and clinics that you have borne yourself as a result of an accident at work.

Rental and leasing- Advertising costs also play an important role in rental and leasing income. Deductible costs include, for example, depreciation, interest on debt and maintenance expenses. Tip: If you rent out apartments, you should renovate your property every now and then. You can read the legal definition of advertising expenses in Section 9 of the Income Tax Act.

Holding an apartment - An employee who keeps an apartment for exclusively professional reasons during parental leave, because he plans to return to the full-time position afterwards, may be able to deduct the rental costs during this time as “other types of income-related expenses”.

This was decided by the Finanzgericht Berlin-Brandenburg in a case of an employed ophthalmologist who moved in with her partner in another city. The second apartment - probably in Berlin - she had hardly used for work during her parental leave, which is why a deduction was ruled out due to double housekeeping. Nevertheless, the judges allowed income-related expenses to be deducted. As a precaution, the doctor kept her relatively cheap apartment at the place of employment for professional reasons and because of the tight rental market. However, private reasons are likely to play only a subordinate role. In order to check this, a strict standard should be applied, emphasized the judges (Finanzgericht Berlin-Brandenburg, judgment of June 1, 2017, Az. 3 K 3278/14; non-admission complaint filed with the Federal Fiscal Court: Az. VI B 69/17).

interest- For income from capital assets (including dividends), the legislature introduced a ban on income-related expenses from 2009. Since then, there has been a flat-rate withholding tax of 25 percent for investment income. Advertising costs are neglected; you can only deduct a flat-rate saver amount of 801 euros (1,602 euros for married couples or registered partners).

Udo Reuss

Udo Reuss

The tax lawyer and business graduate Udo Reuß is responsible for tax issues at Finanztip. Before that, he worked for various business and specialist publishers such as Handelsblatt, F.A.Z.-Verlagsgruppe, Haufe-Lexware and Vogel Business Media - 14 years of which he worked as editor-in-chief of trade magazines. He draws the relevant judgments for tax savers from the complex tax law.

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