If the move is related to the employee's professional activity, the employee can claim the moving expenses incurred as work-related expenses (Werbungskosten). Alternatively, the employer may reimburse the moving expenses to the employee tax-free. It is important that the new thresholds for flat-rate moving allowances under the Federal Moving Expenses Act (Bundesumzugskostengesetz, BUKG) are observed.
Legal aspect: When is a move job-related?
A job-related reason for the move exists in the following cases:
- a transfer
- a change of workplace or position
- a change of residence to take up a professional activity for the first time
- when the change of residence is predominantly or entirely in the employer's interest
- a change of residence to significantly reduce the distance between home and work (by at least 1 hour per day)
Deductible moving expenses
Deductible moving expenses include:
- Transport costs: costs for transporting the household goods to the new home (including tolls and transport insurance)
- Travel expenses: costs for travel to the new place of residence (including travel expenses for an accompanying person, e.g. spouse) and for searching for and viewing a new home
- Rent compensation: additional costs due to notice periods, i.e. if rent must be paid simultaneously for the new and old home for a period of 6 months, or if it is not possible to move into the new home within 3 months
- Customary local broker fees
In addition, other moving expenses may also be claimed. These include:
- Expenses for renovating the old home
- Disassembly and connection of household appliances
- Advertisements for finding a new home
For other moving expenses, there is not only the option of claiming the documented costs (via invoice), but also the option of claiming costs without proof at the applicable flat-rate moving allowances.
- Flat-rate allowance for other moving expenses for the person relocating (§ 10 Abs. 1 S. 2 Nr. 1 BUKG):
From 01.04.2021: €870
From 01.04.2022: €886
- Flat-rate allowance for other moving expenses for additional persons (spouse, civil partner, children):
From 01.04.2021: €580
From 01.04.2022: €590
- Flat-rate allowance for one day before and after the move:
From 01.04.2021: €174
From 01.04.2022: €177
Frequently asked questions
Frequently asked questions
When is a relocation considered job-related?
A relocation is job-related in cases of transfer, change of workplace or position, taking up employment for the first time, or when it is predominantly in the employer's interest. A significant reduction in commuting time of at least one hour per day (round trip combined) also establishes a job-related reason. Only in these cases are relocation costs deductible as income-related expenses or eligible for tax-free reimbursement by the employer.
Which moving expenses are deductible in the case of a job-related relocation?
Deductible items include transport costs for household goods (including tolls and transport insurance), travel expenses to the new place of residence as well as for apartment searches and viewings (also for an accompanying person), rent compensation in case of double rent payments, and customary local broker fees for the new apartment. In addition, other moving-related expenses such as renovation costs for the previous apartment, connection of household appliances, or apartment advertisements may be claimed.
What is the relocation expense allowance for miscellaneous costs from April 2022?
Effective 01.04.2022, the flat-rate allowance for miscellaneous relocation expenses is EUR 886 for the person relocating and an additional EUR 590 for each further household member (spouse, civil partner, children). This flat rate can be claimed without itemised proof. Alternatively, actual costs may be substantiated by invoices.
Can relocation expenses be claimed without receipts?
Yes, for miscellaneous relocation expenses you may choose between itemized proof and the flat-rate amount under the Bundesumzugskostengesetz (BUKG, German Federal Relocation Expenses Act). Transport costs, travel expenses, rent compensation and broker fees, however, must generally be substantiated by receipts.
Under what conditions is a rental compensation for the old apartment deductible?
Rental compensation can be claimed if, due to the notice period, rent must be paid simultaneously for both the old and new apartment, for a maximum of six months. Likewise deductible is double rent if you cannot move into the new apartment within three months. A precondition is always that the move is occupationally motivated.