There are specific rules for claiming your home office allowance as a tax deduction in Germany. First of all: Stick to the deadlines. Depending on whether you file your tax return yourself or instruct a tax advisor or income tax assistance organisation, the following deadlines apply in Germany for the 2023 tax year:

• Private individuals who file their tax return themselves: The deadline is 31 July 2024. This means you have until 31 July 2024 to submit your tax return for 2023 to the tax office.

• Taxpayers who instruct a tax consultant or income tax assistance organisation: In this case, the deadline is automatically extended. Your tax return for 2023 must then be submitted to the tax office by 28 February 2025 at the latest.

If you submit your tax return late without a valid reason, the tax office may impose a late filing penalty - so make sure you complete your tax return on time.

How to benefit from the home office allowance

Until a few years ago, a separate study was required in order to claim tax benefits for working from home. Strict regulations applied with regard to this study. For example, it had to have a door and no items for private use, such as a guest bed or sports equipment, were allowed in the room. That has now changed. The 2020 Annual Tax Act introduced the home office allowance in response to the coronavirus pandemic. This makes it easier for employees, freelancers, the self-employed and tradespeople to claim for home office activities as a tax deductible. Since the 2023 tax year, the home office allowance is no longer temporary, but is rather firmly anchored in tax law.

If you actually have a study at home that fulfils the tax office's criteria, you have a choice: You can either opt for the conventional deduction for your study, or you can deduct for days worked from home by means of the home office allowance. However, you can't take advantage of both options, as the home office allowance cannot be applied on top of a conventional deduction.

Rules for the home office allowance

Your home workstation is not required to fulfil any specific requirements for the home office allowance. It doesn't matter whether you work at the dining table, at a corner desk, or on the sofa.

In order declare that you worked from home on your tax return, all you need is to be able to show evidence of the days worked from home, should the tax office ask. To this end, it is perfectly sufficient to make a note of your home office days in a calendar or spreadsheet.

For the 2023 tax year, the tax office provides for a flat rate allowance of six euros per working day in a home office. You can claim a maximum of 210 working days worked from home. This means that the maximum amount is 1,260 euros per year.

Example: You worked from home 120 days in 2023. This means you can claim 720 euros (120 days * 6 euros) as a home office allowance.

Background: This home office allowance is considered part of the income-related expenses and is therefore included in the general flat-rate income-related expenses allowance. Income-related expenses are expenses that are incurred during the course of professional activity. This includes, for example, work equipment such as office supplies or computers, as well as daily journeys to work. This means: The benefits of the home office allowance only come into play if your actual income-related expenses exceed the allowance for income-related expenses (€1,230 for the 2023 tax year). In concrete terms, this means: If you add up your expenses for work, i.e. the home office allowance and what you spend on travelling to work, for example, and these costs together do not exceed €1,230 per year, then the extra allowance for working from home will unfortunately not offer any tax benefits.

Home office allowance at a glance

• Amount of the fixed allowance: Six euros per home office working day for a maximum of 210 working days.

• No specially furnished study required: In contrast to previous regulations, a separately designated study is no longer required for the home office allowance. It's sufficient if you work from home.

• Proof of home office days: It is a good idea to keep a calendar or work diary in which you note the days on which you work exclusively from home. This serves as proof should the tax office request that you provide it.

• Other income-related expenses: Only if you claim income-related expenses of more than 1,230 euros (2023 employee lump sum allowance) will working from home have a positive effect on your tax.

• Relevant to everyone: It’s not just employees who receive the lump sum allowance, but also freelancers, the self-employed and tradespeople.

• Unlimited validity: From the 2023 tax year, the home office allowance will no longer be temporary, but will be firmly anchored in tax law.

Multiple jobs in a home office?

If you work as a freelancer in addition to your job and do both jobs from home, you can still only deduct the home office allowance of 6 euros once for each day. The maximum annual amount of 1,260 euros also applies here.

If you worked both as an employee and as a self-employed person on the same day, you can choose whether to deduct the 6 euros as income-related expenses for your employment or as business expenses for your self-employment.

Trick: It may be more advantageous to claim the lump sum allowance as a business expense for your self-employed income. Since you cannot deduct the travel allowance on a home office day (logically: you either work at home or drive to work, both at the same time are not possible), your income-related expenses as an employee are often below the lump sum of 1,230 euros. This means that the home office allowance may only have a partial effect or no effect at all on income-related expenses.

Deducting co-working space from tax

It is possible to deduct a co-working space from your tax return under certain conditions, as the costs can be claimed as business expenses or income-related expenses. This depends on whether you are self-employed or employed. It also depends on what form of co-working you do: Are you using a flexible workplace or renting a permanent office? Here are some points you should bear in mind:

Self-employed workers and freelancers

• You can generally deduct the costs of a co-working space as a business expense. This includes rent, any ancillary costs and potentially also costs for additional services offered in the co-working space.

• It is important that the use of the co-working space is directly related to your professional activity and is necessary in order to generate income.

Employees

• As an employee, you can deduct the costs of a co-working space as income-related expenses, provided that the use of the space is for professional purposes and serves to generate, secure and maintain your income.

• However, deductibility may be limited if your employer already provides you with a workplace or covers the costs. In this case, a deduction would not be possible or would only be partially possible.

Home office allowance and co-working space?

If you are already claiming the home office allowance, you should note that this and the costs for the co-working space cannot be claimed twice. The regulations may vary depending on the individual case.

Conclusion: You have many opportunities to claim tax deductions for working from home or in a co-working space. Please note that current changes may apply or adjustments to the above regulations may occur. Therefore, always check the latest tax office guidelines, use a tax programme or consult a tax advisor to ensure that you are taking advantage of all tax reduction options available to you.