Upcoming Flat Rate for Home Office

Laura Bauckmann
November 30, 2020

In the pandemic year 2020, many workers had to improvise and suddenly had to work from home. The service charges rose accordingly. Most of them could not deduct these costs under current German tax law - that is about to change.

Working from home usually increases not only electricity costs but also heating costs. Anyone who works completely from home instead of going to the office in the winter months must reckon with a heating requirement that is around four percent higher, according to calculations by the comparison portal Verivox. Depending on the heating system, this could result in additional costs of up to 45 euros.

When heating with gas, this would mean additional costs of 45 euros for an average consumption. With oil heating, an increase of around 33 euros would have to be planned. The calculations are based on average energy prices in October 2020.

The grand coalition is planning tax relief for employees who have to work from home a lot during the corona pandemic. The "Frankfurter Allgemeine Zeitung" already reported that a tax lump sum of five euros per day, but not more than 600 euros per year, is being discussed.

"The home office flat rate is the flexible answer to the encrusted jurisdiction on the home office - unbureaucratic and easy to understand", CSU finance politician Sebastian Brehm told the "FAZ". "As CSU we want to relieve those who have done enormous things from home during the pandemic.

It is still unclear, however, whether it will be granted in addition to the employee lump sum of 1000 euros. If it were treated like other income-related expenses, only those who earn more than 1000 euros could benefit. Normally, the tax office only recognises costs for the home workplace if a room is used almost exclusively for business purposes.

"If the home office flat rate were granted independently, i.e. in addition to the lump sum for income-related expenses, this would be an excessive (and thus constitutionally dubious) benefit", says the Federal Ministry of Finance.

The Taxpayers' Association welcomed the idea of a flat-rate home office allowance. "Employees who work at home and therefore draw on private resources must receive tax compensation for this," said President Reiner Holznagel. Right from the start, he said, there had been a call for a flat rate of 100 euros per month for income-related expenses. "The five euros a day is therefore a correspondingly good approach", said Holznagel.

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