Funeral service, gravesite, flowers - you can deduct many funeral costs from your taxes. Here we explain what you need to pay attention to and which costs are included.
- Who bears the costs of a funeral?
- To what extent are funeral costs deductible?
- Which funeral expenses can you claim?
- How do the costs affect tax?
- How to declare funeral costs with Taxfix
Who bears the costs of a funeral?
The heirs of a deceased person are legally obliged to pay the costs of the funeral. If there is no heir or if the inheritance is disclaimed, the person who was obliged to pay alimony usually has to cover the costs. These are spouses, children, parents, grandparents or grandchildren.
If one is not legally obliged to bear the funeral expenses, there may nevertheless be moral reasons for doing so. This may be the case if relatives or friends expect it.
To what extent are funeral costs deductible?
If you have paid for the funeral of a relative, the funeral costs are deductible. The tax authorities consider funeral costs of up to 7,500 euros to be reasonable. If your costs are higher, your tax office may not take them fully into account.
You must also reduce your funeral costs by the amount of the inheritance. If the inheritance covers the expenses completely, you cannot claim any costs. Therefore, only the costs that exceed the total amount of the inheritance are deductible.
The tax value of the inheritance includes cash assets, bank deposits, securities, the market value of real estate and jewellery. If there was a payout from a death benefit insurance, this will also have to be deducted from the funeral costs.
Which funeral expenses can you claim?
You can deduct direct funeral costs:
- Costs due to the death: death certificate, costs for doctors, funeral parlour, post-mortem, death notice, coffin/urn, cross etc.
- Costs for the funeral service: flower arrangements, funeral hall/church, speaker/minister, musical performance etc.
- Costs for the gravesite: costs for the use of the gravesite, grave preparation, grave monument, maintenance etc.
- Other costs: interest on the loan to finance the funeral, arrears of the deceased
🚨 Note, however, that you cannot deduct from your taxes the costs of entertaining the mourners or the purchase of mourning clothes.
How do the costs affect tax?
You can claim funeral costs as exceptional expenses.
The crux of the matter is that these costs only have an effect on your tax return if they exceed your reasonable burden. The reasonable burden is calculated individually on the basis of your annual income, your marital status and the number of children.
Only when the funeral costs exceed the limit of your reasonable burden do they have a tax-reducing effect. We explain exactly how your burden limit is calculated in our article on exceptional expenses.
How to declare funeral costs with Taxfix
You can enter funeral costs that were higher than the inheritance in the "Family" section of the Taxfix app:
- Enter the total amount of your funeral costs
- Then enter the tax value of the entire inheritance, if applicable. Click on the small question mark icon if you need more information
- Our app automatically calculates the amount of the deductible funeral costs for you
Our app also automatically calculates your reasonable burden based on your data. If your deductible funeral costs exceed your reasonable burden limit, the portion of the costs above this limit will be taken into account for tax purposes. In the overview of the tax calculation, the costs appear as part of the "Exceptional expenses".