The commute, the laptop on the kitchen table, the nursery bill, the tradesperson in the bathroom: over a year, plenty of expenses add up that the tax office contributes to. The payslip knows nothing about them. Only the tax return brings these costs into play.
The short answer fits into one sentence: costs related to work, health, insurance, family and household. They reduce either taxable income or the tax itself. Even so, money is left unclaimed every year, mostly because receipts are missing. This guide shows everything you can deduct from your taxes in Germany: by type of cost, by life situation and for the self-employed.
The key points at a glance:
- Deductible are work-related expenses, special expenses, extraordinary burdens, household and tradesperson costs, and business expenses.
- For employees, the tax office automatically deducts the €1,230 employee lump sum. Receipts pay off once work-related expenses exceed it.
- Since 2026, the commuter allowance is a flat 38 cents per kilometre of distance, from the first kilometre.
- Working from home brings €6 per day, up to €1,260 a year.
- What comes back depends on the personal tax rate. Voluntary returns can go back up to four years.
What can you deduct for tax purposes? The main costs at a glance
German tax law sorts deductible expenses into a few buckets, and each follows its own rules. The list shows what is tax-deductible, with examples for each category. The category decides which form of the tax return the cost goes on and often the upper limit too.
| Category | What it means | Typical examples |
|---|---|---|
| Work-related expenses (Werbungskosten) | Costs that arise because of the job | Commuting, home office, work equipment, further training |
| Special expenses (Sonderausgaben) | Private expenses the law favours | Health and care insurance, retirement provision, donations, church tax |
| Extraordinary burdens (außergewöhnliche Belastungen) | Unavoidable costs above the reasonable burden | Dentures, glasses, prescribed medication |
| Household services and tradesperson work | 20% of the labour costs straight off the tax | Cleaner, gardening, painting, boiler servicing |
| Business expenses (Betriebsausgaben) | Costs of self-employed work | Office, software, travel costs, business account |
How does deducting work in the tax return?
“Deducting” strictly means this: an expense lowers the amount the tax is calculated on, and with it the tax burden. What comes back is therefore not the expense itself but the tax that would have been due on it. At a personal tax rate of 30%, an extra €1,000 in work-related expenses means roughly €300 less income tax.
What you can deduct on your tax return is entered on the matching form, for example work-related expenses on Anlage N. Lump sums such as the employee lump sum are applied by the tax office automatically when the documented costs are lower. Household services and tradesperson work are different: they take 20% of the labour costs directly off the tax.
Whether this turns into a refund only becomes clear once it is set against the wage tax already withheld during the year.
Mandatory, voluntary, deadlines: what applies to the tax return
Before getting to what you can deduct from income tax, there is a simpler question: is the return mandatory or voluntary? For most taxpayers with employment income only, it is voluntary. A filing obligation arises in these cases, among others:
For the 2025 tax year, the deadline is 31 July 2026. With a tax adviser or an income tax assistance association it extends to 1 March 2027. Without an obligation there are four years: the tax office still accepts the 2022 return until 31 December 2026.
What can I deduct from my taxes as an employee?
For employees, the main item is work-related expenses: everything that arises in connection with the job. The employer already factors €1,230 a year into the wage tax deduction, the employee lump sum (Arbeitnehmer-Pauschbetrag). No receipts are needed for it.
The question “Wage tax: what can I deduct?” therefore comes down to a total. If commuting, home office and work equipment together exceed €1,230, every further receipt counts. For many employees, the commute alone is enough. New from the 2026 tax year: union fees are taken into account on top of the lump sum.
Travel costs and the commuter allowance
For most people the commute is the largest single item. Since 2026 the commuter allowance (Pendlerpauschale) is a flat 38 cents per kilometre of distance, from the very first kilometre. What counts is the one-way distance to the primary place of work, once per working day. With 20 kilometres and 220 working days that comes to €1,672, more than the whole lump sum.
Buses and trains change little about what you can deduct on your taxes: the allowance applies to every means of transport, and higher ticket costs count in full. It remains available with a company car too. With a second household for work, the second home at the place of work counts at up to €1,000 a month, plus one trip home per week.
Home office allowance and home study
The question “What can I deduct for the home office on my tax return?” has two answers. The simple one is the daily allowance: €6 for every day spent working mainly at home, for up to 210 days. That adds up to a maximum of €1,260 a year. No separate room is needed, the kitchen table will do. For days at the office the allowance only applies if no other workplace is permanently available there.
The second answer is the home study (häusliches Arbeitszimmer). It only counts if it is the centre of the entire professional activity. In that case the actual costs are deductible, or alternatively an annual lump sum of €1,260. Combining either with the daily allowance is not possible.
Work equipment, further training and other work-related expenses
Anything used mainly for work counts as work equipment: laptop, monitor, desk, office chair, tools, typical work clothing. Up to €800 net per item the amount is deductible straight away, while more expensive purchases are spread over their useful life. Computers and software, with a useful life of one year, almost always count in full in the year of purchase.
With the question “What can I deduct on my taxes?”, it is mostly the small items that get lost. Further training and specialist books belong here, as do application costs, union and professional association fees, a job-related move and professional liability insurance.
Checklist of work-related expenses
Which deductible costs belong on the tax return is quickest to check with a list. These work-related expenses come up most often:
In short: for employees, one number decides how much effort is worth it, namely €1,230. If commuting, home office and work equipment together exceed it, every receipt counts. If the total stays below, the lump sum applies anyway.
What personal expenses can you deduct from your taxes?
Not every expense you can deduct from your taxes has to do with work. What you can deduct privately, without any link to the job, depends heavily on your life situation. Some items apply to almost all taxpayers: contributions to health and care insurance and to retirement provision, donations and church tax. On top come household services such as domestic help and tradesperson work at 20% of the labour costs, up to €4,000 and €1,200 in tax reduction a year respectively. Separate rules apply to families, to students and trainees, and to pensioners.
Families and single parents
Children bring several items into the return at once. Alongside child benefit of €259 a month, the tax office checks whether the child allowances would be more favourable: in 2026 they total €9,756 per child. This comparison runs automatically via Anlage Kind.
Childcare costs for children under 14 count at 80%, up to €4,800 per child. This covers nursery, childminders or after-school care, but not tutoring or sports clubs. An invoice and a bank transfer are required. Single parents also receive a relief amount of €4,260, plus €240 for each additional child. School fees for a private school are 30% deductible, up to €5,000 per child.
Students and trainees
Without any real income, the tax return seems pointless. For students and trainees it often pays off all the same, because today’s costs can ease the tax burden of later years.
Expenses for a first degree straight after school count as special expenses, up to €6,000 a year and only in the same year. A master’s after a bachelor’s, a second degree or a degree after completed vocational training count as work-related expenses instead. Without income this creates a loss that is carried forward into the first working year. The question “Tax return: what can I deduct?” is answered by typical training costs: semester fees, specialist books, a laptop, trips to the university and interest on a student loan.
Pensioners
For pensioners, the return depends on the basic tax-free allowance. If the taxable part of the pension and other income together exceed €12,348 in 2026, filing is mandatory. Below that it stays voluntary.
Above all, the health and care insurance contributions withheld from the pension are deductible. Medical and care costs count as extraordinary burdens where they exceed the reasonable burden. Gardening or a care service brings 20% of the labour costs as a tax reduction. For wages or rental income alongside the pension there is also the old-age relief amount (Altersentlastungsbetrag). Anyone who turned 64 in 2025 receives 12.8% of this income, up to €608.
What can the self-employed deduct from their taxes?
The self-employed calculate differently. Instead of work-related expenses there are business expenses, and the law has no lump sum for them as it does for employees. Every receipt with a business purpose therefore counts from the first euro. Tax is levied on the profit, meaning income minus business expenses.
Separating business from private makes everything else easier. With a dedicated business account for the self-employed, business expenses run separately from the start, receipts can be matched straight to the transaction, and the tax reserve sits ready in its own sub-accounts.
What can you not deduct from your taxes?
Just as useful as the list of deductible items is the other side: what cannot be deducted from tax. Private living costs stay private, even when they make working life easier:
In between lies a grey area of items used for both. A mobile phone, an internet connection or a laptop that also runs privately are partly deductible. For phone and internet the tax office accepts 20% of the costs without individual proof, up to €20 a month.
Tax deduction tips: how to make the return complete
A trick rarely gets more out of it, completeness usually does. These tax deduction tips start exactly there.
A complete tax return in 5 steps
File invoices and receipts digitally straight after a purchase. That way no item is missing in spring.
Add up commuting costs, home office days and work equipment and compare the total with €1,230. If it is higher, every item belongs on the return.
Only the labour share counts for the tax reduction. It is shown separately on the invoice, and payment is made by bank transfer.
Medical costs only take effect above the reasonable burden. If dentures and glasses fall into the same year, that threshold is easier to reach.
ELSTER and common tax software retrieve payroll data and insurance contributions automatically. What remains to be entered is mainly your own costs.
What else can be deducted is often hidden in the details: donations of up to €300 to charitable organisations, for instance, where a bank statement is enough as proof.
Conclusion
Everything you can deduct from your taxes follows a clear order: work-related expenses for the job, special expenses for provision and family, extraordinary burdens for illness, a tax reduction for work in the household, business expenses for the self-employed. With receipts collected along the way, this becomes a complete return, for earlier years too if needed.
Worth remembering: three numbers carry most employees’ tax returns: the €1,230 employee lump sum, 38 cents per kilometre of distance and €6 per home office day. Only above the lump sum does each further receipt make a difference.
A business account for your self-employment
Separate business expenses from private money from the very first receipt. With the Vivid business account you set aside the tax reserve in sub-accounts with their own IBAN, capture receipts in the app and hand over the bookkeeping via DATEV export.
Frequently asked questions (FAQ)
What can you deduct from your taxes without receipts?
The tax office accepts some amounts without proof: the employee lump sum of €1,230, the special expenses lump sum of €36 (€72 for joint assessment) and the home office allowance of €6 per day up to €1,260 a year. “Without receipts” does not mean “without evidence”, though: invoices for actual costs should be kept, because the tax office can still request them later.
Which insurance policies can you deduct from your taxes?
What you can deduct from your taxes for insurance depends on its purpose. Fully deductible are contributions to basic health and care insurance, the statutory pension insurance and the basic pension (Rürup), the latter up to the annual maximum. Liability, accident, occupational disability or term life insurance count as other provision expenses, up to €1,900 for employees and €2,800 for the self-employed. Health insurance often uses up this ceiling already. Job-related policies such as professional liability insurance are work-related expenses.
Which work equipment can you deduct from your taxes?
Typical items are a laptop, monitor, desk and office chair, tools, a mobile phone used for work, software and work clothing such as a uniform or protective clothing. Up to €800 net, which for employees means €952 including VAT, the amount is fully deductible in the year of purchase. More expensive equipment is spread over its useful life. Computers and software usually count in full in the year of purchase because of their one-year useful life. With private use, only the work share counts.
What can you deduct 100 percent from your taxes?
Fully deductible are, for example, work equipment up to €952 gross, union fees, job-related further training, church tax and contributions to basic health and care insurance. “100 percent deductible” does not mean the whole amount comes back, though. The saving corresponds to the personal tax rate.
How high is the employee lump sum in 2026?
The employee lump sum remains unchanged at €1,230 a year in 2026. It is applied automatically in the wage tax deduction and in the tax return, and no receipts are needed for it. If the actual work-related expenses are higher, the tax office uses the documented costs instead. New from the 2026 tax year: union fees are added on top of the lump sum.
Which invoices can you deduct from your taxes?
Invoices can be deducted for work-related expenses, for household services and tradesperson work, for childcare and for medical costs that no insurance reimburses. For tradespeople, cleaners and childcare a double rule applies: there has to be an invoice, and the amount has to be paid by bank transfer. For tradesperson work, only the share for labour and travel counts, not the materials.
Note: the contents of this blog are for general information only and do not constitute legal, financial, investment or tax advice. They are not a recommendation or a basis for financial decisions. Before acting on this information, please seek advice from qualified professionals who can take your personal situation into account.
