Expenses for a home office of up to €1,250 are now tax deductible in certain circumstances.
After revision of § 4 par. 5 sentence 1 no. 6b EStG (German income tax law) by the Tax Amendment Act 2010, expenses for a home office from 2007 on are now also tax-deductible - up to an amount of € 1,250 – if there is no other workplace available in order to perform operational or business activity.
By the statement of the German Federal Ministry of Finance dated 15th December 2010, the tax authorities were instructed to officially amend the assessments affected by the revision, where possible.
Where tax assessments are pending or have been issued no more than a month ago or are subject to an appeal then affected taxpayers may claim the deductions in their tax returns for the assessment period 2007 onwards.
Where the German tax authorities have issued provisional tax assessment notices with respect to non-deductible home office expenses affected taxpayers should inform the German tax authorities of these currently unclaimed expenses. The German tax authorities will then amend the assessments to take account of the deductible home offices expenses.
Tax assessments which have definitively been issued and were not appealed against on time cannot be amended.
Statement of the German Federal Ministry of Finance dated 15th December 2010 – IV A 3 – S 0338/07/100010).
For further information or to discuss any of the issues raised, please contact Joachim Menz on +49 89 2422 300.