Germany: Travel to work using a company car by home workers may be a taxable benefit

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On 7 May 2009, the Regional Finance Office Frankfurt confirmed its position on the following questions:-

• when is a home office to be regarded as the regular working place of an employee; and
• what consequences result from this finding where an employee travels using a company car to another regular working place.

In general, an employee’s home office is not a regular working place, since it is does not form part of an employer’s working office or equipment.  However, if the employer ‘rents’ a working room in the home of an employee for business reasons, this will constitute a regular working place.

Where an employee with a regular working place at home travels to an office of the employer or another local working office at least once a week (at least 46 times in the calendar year), this will establish the other office as another regular working place.  However, travel to these regular working places away from the home office will be deemed to be commuting to and from home, since the private nature of the home office location dominates over the home office part.

As such, the benefit in kind charge to the employee must be increased by the value of these commutes.  In order to determine the additional benefit in kind, it is assumed that the nearest regular working place is the home office of the employee.  For trips between the home office and a regular working place which is away from home, the benefit in kind is calculated by taking 0.002% of the list price of the car for each kilometer driven between the employee’s home and the other regular working place.

Resources

Regional Finance Office Frankfurt: Order dated 7 May 2009

For further information or to discuss the issues raised, please contact Joachim Menz (joachim.menz@keller-menz.de) on +49 89 24 22 30 0.

This article was produced by, and re-produced with kind permission of, our correspondent firm in Germany, Keller Menz Rechtsanwälte.  www.keller-menz.de

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