Employees who commute to work on a daily basis regularly include the associated costs as advertising costs in their tax return via a travel allowance. However, they can only calculate the distance fee for the simple distance between their apartment and the first place of activity. For the return journey, no consideration as advertising costs is therefore possible. In this article, however, we present you with a tax scheme with which you can include both outward and return journeys as travel costs instead of the travel fee in the tax return and thus receive twice the amount as advertising costs. However, this is only possible if the employers also participate.

Employees who commute to work on a daily basis are familiar with the annually recurring ritual: In their income tax return, they apply the travel allowance of EUR 0.30 per kilometre distance between their residence and their first place of work. However, this also means that only the simple way is taken into account for tax purposes. After all, advertising costs can only be tax-deducted if they are accompanied by securing earned income. However, since the return journey home does not lead to any acquisition, it remains excluded from the travel fee.

Even if this may seem unrealistic and therefore quite questionable, this is regulated in income tax law in this way. But what if we could show you how you can still include your home trips in your advertising costs? That would be nice, wouldn't it? Well then read here how you can perceive such a design.

Immediately: In order to obtain better tax conditions in relation to your professional travel costs, you will have to say goodbye to the approach of the travel cost lump sum as far as possible. Instead, however, you will receive travel expenses. But what is the difference?

The travel fee is legally regulated in § 9 (1) sentence 3 number 4 EStG. The travel costs of employees for their daily distances between home and first place of work are considered flat-rate as advertising costs at EUR 0.30 per distance kilometre. On the one hand, it should be pointed out again that this distance fee applies to simple routes, i.e. only for outward journeys. Even if you go home during the lunch break, for example, the second trip to the first place of work remains on the same day without tax consideration.

In addition, it is necessary to determine the location that is defined as the first place of activity. However, this location is not regulated by tax law. Rather, according to § 9 (4) EStG, it takes place in particular in an employment contractual agreement between employers and employees. In this respect, there is therefore maximum freedom of design for both parties. This is particularly important for our tax structure. Although there are still further regulations in § 9 EStG in connection with the travel fee, we do not use the further details in order to focus this contribution on the essentials.

Travel costs are also regulated in § 9 EStG. More specifically, the instructions in this regard can be found in § 9 (1) sentence 3 number 4a EStG. Thus, travel costs are included as advertising costs in the income tax return if employees are absent from both their home and their first place of work for at least eight hours a day. In such a case, travel costs count for all routes – i.e. both outward and return journeys. The costs for these routes are set at a flat rate of EUR 0.30 per distance kilometre.

Here is our tax design model, with which employees can set travel costs instead of the travel fee. For this purpose, employers and employees agree in the employment contract that a location other than the one they visit daily is considered the first place of work. This logically assumes that the employer has several company locations. What is more, the first place of work that is now valid must be a location where the employee actually carries out his or her work. So you should really work there, even if only a few times a year. If necessary, this should be demonstrated. For these journeys, the employees then also regularly set the travel fee according to the simple distance from their place of residence.

For the usual, almost daily journeys, but also on the part of the employees travel costs. However, strictly speaking, one must not speak of travel costs in terms of income tax law. Instead, the tax term travel costs is used. And since travel costs cover both the outward and return journeys of employees, we can consider double the distance for tax purposes for most of the year. In this way, we have left the travel allowance for the easy distance behind us and set travel costs instead.

In order to show how advantageous this design is for employees, we expect a simple distance of 25 km between the home and the daily workplace, which is now different from the contractually agreed first place of work. In addition, let us assume that these trips take place on 200 working days a year. Then comes a journey of a total of 10,000 km for all round-trip journeys per year. And for each of these kilometers you get then EUR 0.30, thus EUR 3,000 practically tax-free. However, if you had taxed these trips via the travel fee, you would be taxed EUR 1,500 more.

With a distance of 25 km, we have already chosen a rather moderate example. Indeed, many workers travel far more distances every day to get to work. The potential tax savings in these cases are correspondingly higher.

A small additional tax advantage when applying travel costs instead of the travel allowance is the consideration of catering expenses. Because in connection with travel costs, employees can also set a food extra expense in their income tax return. This general catering extra expense is also regulated by law as a lump sum. In doing so, the legislature has set a daily catering fee of EUR 14, provided that employees stay away from their home and their first place of work for a period of at least eight hours. If you factor in the times for return trips and the lunch break, you can easily get to this minimum number of hours on an ordinary full-time working day.

However, this catering fee can only be set for a maximum of three months. Nevertheless, in this way a pretty sum of money comes together, which leads to the same amount of gross wages remaining untaxed. If you expect 20 working days per month, you can get a total of EUR 840 tax-free. This is in addition to the travel costs instead of the travel allowance.

Alternatively, employers can also pay their employees the catering costs and tax them lump sum. This would also have the advantage that the company can also benefit from this tax by recognizing operating expenses.

The legislator may think that the daily journeys from work to home do not represent advertising costs, with our simple design we bring him to indirectly acknowledge it. In the way we described, we double the advertising costs associated with commuting to work every day. All you need is another place of work, which you agree as the first place of work with the employer.

Much depends on the employer if you want to implement this tax design. Both the condition that an alternative place of work must be available and the willingness to design the employment contract accordingly must also be given by the employer. As a rule, however, employers do everything out of self-interest to ensure that their employees receive as much as possible net from their gross salary. After all, this is another advantage that binds employees to their own company. And if the employees can also use the food plausals, then these are even two tangible tax advantages that employers can help their employees to. But maybe they even want to pocket a small tax bonus themselves?

Do not miss these tax benefits. Talk to your employer and send her or him the link to this post so that our information also arrives there. It is quite possible that all employees of the company can benefit from these tax advantages. In any case, it is a pleasure for us to design taxes.