Many employees travel countless kilometers daily for work. The costs of commuting can add up significantly. Fortunately, there are various ways for employees to deduct their travel expenses for tax purposes. However, when considering the commuter allowance, work-related expenses, and tax deductions for daily commutes to the workplace, some important points need to be taken into account. In this blog post, we explain the various terms and elucidate their differences and similarities.
As a general rule: For the journey to the first place of work, i.e., the regular workplace, travel expenses are not reimbursed by the employer unless the company offers this as an employee benefit. Employees can, however, claim the costs incurred on the commute to work through the distance allowance as work-related expenses in their tax return. For business trips, the mileage allowance applies.
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The travel allowance is a collective term for all allowances available to employees. This includes both the commuter allowance (distance allowance) and the mileage allowance applicable to business trips.
For instance, self-employed individuals can use the travel allowance to deduct additional expenses for trips to the office, to clients, and for business trips for tax purposes.
For the commute between home and the first place of work, employees can apply the distance allowance. This applies to regular commutes to the office and can be used for each working day and the one-way distance.
For business trips or client visits, employees can use the mileage allowance to get reimbursed for incurred travel expenses.
The same amount of 0.30 euros per kilometer applies to all allowances. From the 21st kilometer, employees can claim even 0.38 euros per kilometer.
The distance allowance, also known as the commuter allowance, allows employees to claim travel expenses related to commuting to the workplace for tax purposes. The distance allowance enables employees to deduct 30 cents per kilometer for the one-way trip between home and the workplace for each working day. These travel expenses can be reported in the tax return to reduce work-related expenses and thereby lower the tax burden. It is important to note that the commuter allowance only applies to actual trips made between home and the workplace. The annual savings depend on the distance to the workplace and the number of working days.
It is essential to provide evidence of regular commutes to work and choose the shortest route.
The distance allowance or commuter allowance is independent of the mode of transport. It benefits pedestrians, cyclists, motorcyclists, bus, and train users, as well as car drivers equally. Flights, however, are excluded from the allowance.
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Get infoAnyone who travels by car on business trips can make use of the mileage allowance. The mileage allowance offers employees the opportunity to be reimbursed for travel expenses incurred on business trips.
Employees can currently claim 30 cents per kilometer driven using the mileage allowance for journeys made in their own car. For journeys with other motorized vehicles, such as motorcycles, a flat rate of 20 cents per kilometer applies.
Low earners cannot benefit from the increased distance allowance or commuter allowance since 2021, as their income is below the basic tax-free allowance and they therefore do not pay income tax. They therefore do not have the opportunity to claim the increased commuting allowance for tax purposes. For this reason, the legislator has introduced the mobility bonus. The mobility bonus is a state subsidy program that was adopted as part of the climate package and is aimed at low-income earners with long commutes. They can also benefit from the increase in the commuter allowance.
Two conditions must be met in order to receive the mobility bonus:
For every kilometer over 20 kilometers, low-income commuters receive 14 percent of the increased commuter allowance, which corresponds to 4.9 cents or 5.43 cents. Like the commuter allowance, the mobility bonus applies regardless of the means of transport used. The mobility bonus therefore also relieves the burden on pedestrians and cyclists who have no travel costs.
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