In connection with taxes, you have probably heard of "income-related expenses" - Werbungskosten - many times. In this article, we have summarised what these costs are, how they affect your tax return and how you can declare them in the Taxfix app.
- What are income-related expenses?
- Werbungskostenpauschale: a lump sum for income-related expenses
- Which costs can I deduct as income-related expenses?
- How can I enter income-related expenses in the Taxfix app?
- Werbungskostenpauschale and other lump sums automatically applied by the app
What are income-related expenses?
Income-related expenses are all expenses that you incur in direct connection with your work. You can deduct them from your tax return if they have not been reimbursed by your employer.
For example, you drive to work, you have to take your own tools with you, you attend a pofessional training course or you move to a new city for work. These are all expenses that secure, maintain or acquire your income as an employee: Work-related expenses.
Werbungskostenpauschale: a lump sum for income-related expenses
The tax office knows that every job also involves income-related expenses. That is why it provides every employee with an annual lump sum for income-related expenses, the so-called Werbungskostenpauschale. 1,000 euros, or 1,200 euros from 2022, are automatically deducted from the income from non-self-employed work and made tax-free. For married couples and registered partners assessed jointly, the amount doubles.
Which costs can I deduct as income-related expenses?
In order to really save taxes, you must claim income-related expenses on your tax return that exceed the lump sum of 1,000 euros / 1,200 euros. There are many of these. Here is a list of the most common income-related expenses that you can deduct from your taxes:
- Travel costs / Commute
- Costs for work equipment
- Moving expenses
- Travel expenses for a business trip
- Costs for a second home
- Job application costs
- Contributions to professional associations such as trade unions
- Professional training costs
- Bank account fees
How can I enter income-related expenses in the Taxfix app?
In our app, we ask for the most common tax-relevant income-related expenses, so you can easily follow the course of the questions. You can enter the costs in the "Work" category if they have not already been reimbursed to you tax-free by your employer.
Werbungskostenpauschale and other lump sums automatically applied by the app
Since the tax office automatically takes the lump sum for income-related expenses (Werbungskostenpauschale) into account when calculating your income tax, this also applies to our app:
If the income-related expenses you enter do not exceed 1,000 euros (or 1,200 euros from 2022), the lump sum is automatically applied. In this case, our calculation will show income-related expenses in the amount of 1,000 euros / 1,200 euros. This corresponds to the procedure of the tax office.
For work equipment, we automatically take into account a non-objection limit of 110 euros if it is stated in the app that you have worked. This amount is also indicated if you do not record any work equipment yourself.
In addition, our app automatically takes into account an amount of 16 euros for bank account fees if you’ve been working.
If you comply with these non-objection limits, the tax office does not usually ask for receipts. You can find more information on this here.