As a rule, the tax office takes the view that so-called "Knöllchen" (parking fines) — incurred for instance by parcel delivery drivers — must be added to taxable employment income.
The Finanzgericht Düsseldorf has now ruled in favour of the parcel delivery drivers, thwarting the tax office's position (I K 2470/14 L). According to the judges, where a parcel delivery service covers the parking fines of its couriers, this does not constitute employment income and is therefore not subject to taxation.
The reasoning is that, by making the payment, the company is merely settling its own liability. While the drivers committed the regulatory offence, the parking fines were imposed on the company as the registered keeper of the vehicles, not on the drivers themselves. In addition, the company has no right of recourse against the drivers.
The parcel delivery service had filed suit against the tax office because it had regularly assumed parking fines incurred in locations where no special permit for short-term parking was available. The tax office had added these assumed amounts to the drivers' taxable employment income.
It remains to be seen whether this ruling will also be applied in other cases. An appeal to the Bundesfinanzhof (BFH) has been admitted, so the matter remains open.
Frequently asked questions
Frequently asked questions
Are parking fines for illegal parking that are paid by the employer considered taxable wages?
According to a ruling by the FG Düsseldorf (Az. 1 K 2470/14 L), parking fines paid by the employer on behalf of its drivers do not constitute wages subject to wage tax. The prerequisite is that the fine was imposed on the company as the vehicle owner. The tax authorities have traditionally taken a different view and treat such amounts as part of taxable wages.
Why does the Düsseldorf Tax Court rule that assumed parking tickets do not constitute taxable wages?
The Düsseldorf Tax Court argues that the company merely settles its own liability when paying, since the fine is imposed on the company as the vehicle owner and not on the driver. In addition, there are no recourse claims against the driver. As a result, the driver receives no monetary benefit.
Under what conditions is the employer's assumption of warning fines tax-free?
According to the ruling, the assumption is tax-free if the warning fine was imposed directly on the company as the vehicle owner and the company waives any recourse claims against the driver. If, however, the fine is imposed directly on the employee and reimbursed by the employer, this generally constitutes taxable wages.
Is the FG ruling on parking fines already final?
No, the FG Düsseldorf has allowed an appeal to the Federal Fiscal Court (BFH). Until a supreme court decision is issued, it remains open whether this view is generally applicable. Affected companies should keep comparable cases open where appropriate.
How has the tax office treated employer-paid parking fines so far?
The tax authorities generally add warning fines paid by the employer to the drivers' wages subject to wage tax. In the case at hand, this practice was corrected by the FG Düsseldorf in favor of the employer. However, a final clarification by the BFH is still pending.