Professional Expenses Allowance: Who Qualifies and What You Get
Learn how this automatic tax deduction works for employees in Germany and when you might need to claim more than the standard amount.
The Professional Expenses Allowance is a standard tax deduction that reduces your taxable income based on the costs you incur while working.
Who it's for
This scheme is available to all employees.
What you get
You receive an automatic tax-free deduction of 1,230 € from your annual income. This lowers the total amount of money you are taxed on.
What it costs you
There is no cost to use this. The deduction is applied automatically, so you do not need to file a separate application to receive it.
The catch to know
The 1,230 € amount is a fixed baseline. If your actual work-related expenses are higher than this amount, you must list and prove those specific costs individually to get a larger deduction.
How to apply
- Keep track of your work-related spending throughout the year.
- Compare your total spending to the standard deduction amount.
- If your spending is higher, include those specific costs in your annual tax return.
- Submit your tax return to the local tax office.