Relocation costs can be claimed in the tax return and consequently lead to tax savings. Such relocation costs arise from changing jobs or when the daily travel time to work is shortened by at least 1 hour. The costs to be taken into account include, among other things, the costs for the services of the moving company including tips, travel expenses for the trip to the new place of residence, additional expenses for meals, temporary double rental payments, renovation costs for the returned apartment and brokerage fees as well as costs for relocation-related tutoring (maximum amount of €8,116.00) for the children. If costs cannot be proven by supporting documents, the legally permitted lump sums (€866.00 + €590.00 for each additional person in the household + €177.00 if an apartment is moved into for the first time) are to be applied. Advice from tax consultants or information from the tax office should be sought. Different rules apply, depending on the reason for the move:
Moving for private reasons
The costs incurred for the private move are tax-equivalent to household services. 20% of up to € 20,000.00, i.e. up to € 4,000.00 annually, can be deducted from the income tax debt.
Relocation for professional reasons
Relocation for professional reasons is given in case the removal needs to happen for starting an employment that is subject to social security contributions for the first time or because of a change of the employer whose job is disproportionately far from the previous home or because of the posting by the actual employer to a different location which is disproportionate far from the previous home or if the removal takes place in order to shorten the distance to the job by at least one hour daily return trip.
In these cases, the relocation costs can be taken into account as advertising costs with regard to the actual income from employment and cause a reduction of the taxable income.
Moving for health reasons
The relocation costs are considered as an extraordinary burden as well as in the case for relocation for professional reasons.
Reimbursement of moving expenses for persons employed in the public service
Relocation reimbursement to federal officials, federal judges, professional soldiers, corresponding retirees or surviving dependents is governed by the law on moving expenses allowances for federal officials, judges in federal service and soldiers (Federal Moving Costs Act BUKG). Relocation costs are paid for transport expenses, travel expenses, rent allowances, brokerage fees, teaching costs for children and other procurement costs for the apartment. There are special provisions for international relocations to another country. As a rule, compensation must be applied for and agreed before the move is carried out.
Housing certificate according to the Federal Registration Act
The landlord of the new apartment is obliged to fill out and issue a landlord certificate confirming the tenancy so that the change of registration can be made within one week by presenting this certificate by the moving customer. If the certificate cannot be presented within this period, it must be presented within two weeks of moving into the new apartment. The landlord’s obligation arises from Section 19 of the Federal Registration Act (BMG). When moving into their own property, the moving person fills out the certificate himself.
Change of address order
On this occasion, we would also like to point out the need to set up a change of address order at the post office for 12 or 24 months.
