With the draft annual tax law 2024 (JStG 2024) published in mid-July, the Federal Government is adapting tax law to current circumstances. On board are tax relief, relief from bureaucracy and legally necessary changes due to certain court decisions. So let’s take a more detailed look at the annual tax law 2024!

1.Income and withdrawals from photovoltaic systems

According to § 3 no. 72 EStG, which was introduced by the Annual Tax Act 2022, income and withdrawals in connection with PV systems are excluded from taxation. Until now, however, the exemption only applied up to an installed capacity of 15 kWp per residential or commercial unit.

The Federal Government wants to increase this limit to 30 kWp per residential or commercial unit. In addition, the annual tax law 2024 clarifies that this is an exemption. There is a change in the previous wording of the standard, according to which it was also possible to assume an allowance for photovoltaic systems.

The “new” § 3 no. 72 EStG is to apply for the first time to installations that taxpayers purchase after 31.12.2024.

2. introduction of mobility budgets by the annual tax law 2024

With the so-called mobility budget, the government is planning to introduce a new way to flat-rate payroll tax. § 40 paragraph 2 sentence 1 number 8 (new) EStG is to provide up to EUR 2,400 per year.

The employer can provide the employee with the mobility budget of up to EUR 200 per month in addition to the wage owed anyway as a reference in kind and tax it at a flat rate of 25%. Employees then have the opportunity to spend the budget on e-scooters, car sharing or public transport (for example in the form of individual trips). The tax burden lies with the employer.

It has already been announced, however, to exempt the use of private motor vehicles and company vehicles. For these, the following EStG remains in the previous regulations, especially in the approach of a material reference according to § 8 (2) sentence 2. Employees must continue to pay tax on company cars, which they can also use privately, as wages.

Note: In contrast to the usual case of remuneration in kind, according to § 40 (2) sentence 1 number 8 (new) EStG, the taxation is not based on the actual costs of the employee, but on the amount made available (for example EUR 150 per month). This simplifies the process, since corresponding proof obligations are eliminated.

3. reintroduction of residential charity

With the annual tax law 2024, the legislature also wants to reintroduce the residential charity abolished in 1990. With § 52 paragraph 2 number 27 (new) AO, the rental of apartments to needy persons will in future be part of the public service activities. Rental companies such as Immobilien-GmbH can therefore be designed as a non-profit GmbH (gGmbH) if they meet the other requirements of the tax code.

According to the current state (August 2024), the BMF is not planning to set rigid rental ceilings. Nevertheless, the rent must differ from the usual market, so landlords have to leave their apartments cheaper than usual on site. In addition, they are obliged to check at the beginning of the tenancy whether the tenant is actually in need within the meaning of the AO.

4. adaptation of the Small Business Regulation (§ 19 UStG)

The domestic small business regulation according to § 19 paragraph 1 UStG should also be able to use foreign entrepreneurs in the future. Specifically, however, the standard only applies to the rest of the Community territory, i.e. the European Union as a whole. Entrepreneurs in third countries should still not be able to apply § 19 UStG.

Through the annual tax law 2024, the legislature also adjusts the turnover limits. In the future, the following values apply here: