The tax reduction for household-related care services will no longer be available for cash payments in the future.
What is changing
The prerequisites for tax reductions for household-related services and tradesperson services are:
- receipt of an invoice and
- payment to the account of the service provider.
In the view of the BFH, this did not clearly emerge from the previous wording of the law with regard to care and support services.
Entry into force
This applies from the 2025 assessment period.
Frequently asked questions
Frequently asked questions
Are household-related care services still tax-deductible from 2025 if paid in cash?
No. Starting with the 2025 assessment period, the tax reduction for household-related care and support services is only granted if payment is made by non-cash transfer to the service provider's account. Cash payments are therefore expressly excluded.
What formal requirements apply to the tax reduction for household-related services?
Two requirements must be met: a proper invoice from the service provider must be available, and payment must be made cashlessly to the provider's account, e.g. by bank transfer. These requirements apply equally to household-related services and tradesperson services.
Why was the rule on cash payment for care services clarified?
The BFH had ruled that the previous wording of the law did not unambiguously prohibit cash payment for care and support services. The legislator has responded and now clarifies that non-cash payment is also a prerequisite for the tax reduction in the case of these services.
When does the cash payment ban for household-related care and support services take effect?
The new rule applies from the 2025 assessment period. Anyone wishing to claim care or support services for tax purposes from this year onwards should ensure that payment is made by non-cash means and that an invoice is on file.