Which travel expenses can be claimed?
Travel expenses incurred for professional reasons can be claimed on your tax return by entering the appropriate lump sums or flat rate and in some cases, these costs are fully deductible. These can be divided into 3 categories:
- Expenses for the commute from your residence to your primary workplace
- Travel costs from your secondary to primary residence in the case of double household management
- Travel costs for external activities & business trips
Traditional employees can deduct all of these costs as income-related expenses while freelancers/self-employed persons can claim their travel expenses as business expenses (Betriebsausgaben).
1. Your work commute
Primary profession: Commuter allowance
You can claim a commuter allowance (Entfernungs-/Pendlerpauschale) for the commutes between your residence and your primary profession. Primary profession refers to your main and permanent job. Freelancers can claim the commuter allowance for commutes to their first business location while students/trainees can claim it for commutes to their place of education.
The commuter allowance amounts to 30 cents per kilometer for the first 20 kilometers of one-way travel to or from your workplace, regardless of means of transportation or actual incurred expenses. That means this can be claimed whether you walk, ride a bike, drive a car, ride passenger, or take public transportation – just keep in mind that you can only claim one-way per working day. The tax office will only accept deductions for the shortest possible route (regardless of means of transport) and long detours would have to be justified, for example, if it’s more convenient and is a faster route (due to the shorter route having heavy traffic etc.).
Note: As of January 2021, the commuter allowance was increased to 35 cents from the 21st kilometer of one-way travel for long-distance commuters and from 2022 to 2026 it is increased again to 38 cents from the 21st kilometer of one-way travel.
Commuter allowance: Maximum limit
Generally, the tax office accepts a flat rate of 230 trips per year for a 5-day work week, and 280 trips for a 6-day work week. Commuter expenses can not be deducted for days spent home sick, on vacation, or working from home – days spent working from home can instead be claimed using the home office lump sum. A maximum of 4,500 euros per year can be deducted, unless you meet one of the following two exceptions:
- If you commute to work in your own personal or business vehicle and exceed 4,500 euros per year with the commuter allowance, the excess amount may be deducted.
- If you commute to work with public transportation and the costs exceed 4,500 euros per year, you can enter and claim the actual expenses on your tax return (not as a part of the commuter allowance).
If you meet either of these exceptions, hang on to your receipts as proof must be submitted upon the tax office’s request.
Commuter costs for multiple workplaces or professions
There can only be one primary workplace per profession, if you work at several locations they are considered external activity (Auswärtstätigkeit). Expenses for commuting to external activities can be reimbursed if you travel by public transport and the kilometer allowance (Kilometerpauschale) can be used if you travel by car. This applies to both the outward and return journey and amounts to 30 cents per kilometer.
If you have several professions, the commuter allowance can only be used for your primary profession if you travel between there and home on the same day. If you travel from workplace to workplace, the distances can be added, but then the commuter allowance can only be used for half of the total distance.
Mobility premium for long-distance commuters
As of 2021, long-distance commuters with a daily commute of 21 kilometers or more can apply for the new mobility premium (Mobilitätsprämie). In order to apply, your taxable income must not exceed the basic tax-free allowance (Grundfreibetrag) of 9,744 euros (as of 2021). The bonus is based on the 2021 commuter allowance increase and will remain valid until 2026. If eligible, you can apply for this premium directly on your tax return and receive it directly to your bank account. The premium grants a bonus of 14% to the already increased commuter allowance from the 21st kilometer of one-way travel to work and the assessment basis for the premium varies upon the difference between your annual taxable income and the basic tax-free allowance.
2. Commutes to your main residence with two households
Many employees manage two households for professional purposes and shorter commutes to the office, leading to common trips between their primary and secondary residences. One trip per week (or a total of 46 per calendar year) back to your primary residence can be deducted using the commuter allowance regardless of means of transportation. The same rules apply: either the outward or return journey can be deducted. The allowance can be deducted even if no costs were incurred from the trip, such as if you were given a ride.
In order to be eligible to deduct costs for double household management, your “life core” must take place at your primary residence, where you regularly stay and contribute at least 10% of the costs. It is not a prerequisite to have a spouse, partner, or child(ren) living at your primary residence.
The commuter allowance increase to 35 cents (2021) / 38 cents (2022) from the 21st kilometer also applies to trips home to your primary residence to see your family. Note: The maximum of 4,500 euros per year doesn’t apply to family trips home.
If you travel with public transportation and the costs exceed the benefits from the commuter allowance, you can instead deduct those costs individually on your tax return. If you fly home, you can only claim the price of the plane ticket.
Note: Weekly trips to your primary residence cannot be deducted if made with a company car. No tax must be paid on the first trip home with a company car as a non-cash benefit (geldwerter Vorteil), but it must be taxed from the second trip onwards.
3. Costs for business trips
Employers often pay for business trip expenses out of their own pocket – whether it be field service, further education, or visits to a trade fair. If the costs aren’t covered by your employer, it’s definitely worthwhile to claim them on your tax return. Means of transport are irrelevant unless you’ve traveled in a company car, which is not tax-deductible.
Expenses for travel by public transport, ship, or airplane are all reimbursed based on the lowest class available. Train journeys exceeding two hours in the next higher class can be reimbursed.
If you traveled by car, you can either determine the actual incurred costs and claim them or use the kilometer allowance (Kilometerpauschale). Unlike the commuter allowance, the kilometer allowance can be applied to both the outward and return journey.
Per kilometer traveled, the kilometer allowance amounts to:
- 30 cents for trips by car
- 20 cents for trips by motorcycle, scooter, moped, or e-bike
Tip: If your business trip away from home and your workplace exceeds 8 hours, you can claim a flat rate of 14 euros for room and board as well as meals (Verpflegungsmehraufwand). If the trip exceeds 24 hours, you can claim a flat rate of 28 euros.
Please note: The portion of travel expenses covered by your employer can no longer be included in your tax return. You can alternatively declare the costs in full if you also claim the employer subsidies for your travel costs.