Business expense

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Operating expenses are - from a tax law perspective - expenses that are caused by the operation ( Section 4 (4 ) EStG ).

The expenses are to be allocated to a company and can therefore only be incurred in connection with income from agriculture and forestry , from commercial operations and from independent work . In the context of these types of profit income, operating expenses reduce profit .

Operational cause

An issue is operationally initiated if it is objectively related to the business and is subjectively intended to serve the business. In principle , the taxpayer himself determines the type and amount of business expenses ; the operational cause does not depend on whether the expenses are necessary, customary and appropriate. For example, sponsoring is also deductible as a business expense, despite unclear success. However, a lack of customary, necessity and expediency can be a reason to check whether the private cause of the expenses does not outweigh the expenses so much that they cannot be deducted. Section 4, Paragraph 5, Clause 1, No. 7 of the Income Tax Act sets a limit in the event of an excessive disproportion between expenditure and success, insofar as expenditure is to be regarded as inappropriate according to the general public opinion.

Contrast "private lifestyle"

Expenditures for private life (e.g. for food, clothing, hobbies and housing) are generally not business-related and are therefore not deductible - Section 12 No. 1 EStG.

"Mixed" incurred costs

Costs that affect both the private and income-related areas of the taxpayer are special. These costs are known as mixed expenses. Section 12 no. 1 sentence 2 EStG standardizes a general prohibition on sharing and deducting, even if expenses for the private lifestyle were made to promote the profession or the activity of the taxpayer. The case law allowed an exception to this if the private co-cause did not exceed 10%.

With the decision of the Grand Senate of the Federal Fiscal Court of September 21, 2009, the court saw this blanket prohibition as a violation of the net principle and changed its case law to the effect that expenses incurred as a mixture could be deducted as business expenses or business expenses and one according to Section 12 No. 1 EStG non-deductible part can be split. Although the decision was made to split up a business trip, the decision was to be understood as a decision of principle with an impact on the assessment of other mixed expenses. With a letter dated July 6, 2010, the tax authorities basically followed the case law and established uniform criteria for possible apportionment standards.

Anticipated and Post-Operational Expenses

Expenses incurred before or after the opening of operations are a special case. In order for these expenses to be deductible as business expenses, they must be economically related to the business activity.

Anticipated business expenses

Anticipated operating expenses are expenses that are incurred before the actual opening of operations, provided they are economically related to the planned operating activity. For this, there must be a sufficiently concrete connection between the expenses and one of the types of income . The fact that the taxpayer seriously intends to make a profit in the future ( profit- making intention ) must be demonstrated using objective characteristics. For the deduction of expenses as anticipated operating expenses, the general profit determination regulations apply, for example the regulations on depreciation .

Subsequent operating expenses

Expenses incurred after the end of operations can generally no longer be treated as operating expenses. The case law has developed various exceptions to this principle, e.g. B. for subsequent debt interest that could not be repaid from sales and realization proceeds.

Non-deductible or only limited deductible business expenses

Non-deductible business expenses

Regardless of the type of income , Section 12 EStG prohibits the deduction of the following operating expenses:

  • Expenses for private life and maintenance of family members, even in a professional context - § 12 No. 1 EStG, cf. above
  • Donations (without legal obligation) - § 12 No. 2 EStG
  • taxes on income and other personal taxes as well as sales tax on free value taxes and input tax amounts on expenses for which the prohibition of deduction in number 1 or Section 4 (5) sentence 1 no. 1, 3, 4, 7 or paragraph 7 applies; this also applies to the ancillary services attributable to these taxes (Section 12 No. 3 EStG)
  • Fines (§ 12 No. 4 EStG)
  • Expenses of the taxpayer for his first professional training and for a first degree, if these do not take place in the context of an employment relationship (§ 12 No. 5 EStG; see also special expenses )

Partly deductible business expenses

Section 4 (4a) and (5) EStG limits the deductibility of business expenses as follows:

  • Deduction of company debt , insofar as it is caused by overdrafts (Section 4 (4a) EStG)
  • Expenses for gifts to persons who are not employees of the taxpayer; An exemption limit applies here : they are deductible if the acquisition costs of the gift do not exceed a total of EUR 35 per recipient (Section 4 (5) No. 1 EStG); if the costs are higher, no deduction is possible
  • 70% of the expenses for entertaining people for business reasons are deductible - if they are to be regarded as reasonable overall according to the general public opinion (Section 4 (5) No. 2 EStG)
  • Expenses for guest houses at the place of operation are always deductible. If the guest houses are not located at the place of operation, the expenses are only deductible if they concern the company's own employees (Section 4 (5) No. 3 EStG)
  • Expenses for hunting tourism , fishing and yachts ( sailing and motor yachts ) are only deductible if they are operated as an independent commercial enterprise. They are therefore excluded in other commercial operations and in cases of hobby (Section 4 (5) No. 4 EStG)
  • Additional expenses for meals on business trips are to be assessed independently of the actual costs with the lump sums (Section 4 (5) No. 5 EStG)
    • Absence, arrival day: € 12
    • if you are absent for 24 hours: 24 €
    • Absence, departure day: 12 €
  • Expenses for journeys by the taxpayer between his home and the business premises (Section 4 (5) No. 6 EStG; up to 2006: Section 4 (5a) EStG)
  • Additional expenses for double housekeeping (Section 4 (5) No. 6a EStG)
  • Expenses for a home office (Section 4 (5) No. 6b EStG)
  • Other expenses that are not related to lifestyle and therefore generally qualify as business expenses are only deductible if they are reasonable. They are therefore not deductible "to the extent that they are to be viewed as inappropriate according to the general public opinion". When examining the appropriateness , all circumstances of the individual case must be taken into account and, in particular, it must be checked to what extent the expenses are appropriate, necessary for the pursuit of the goal pursued with the respective measure and justified by economically reasonable reasons. So z. B. the maintenance of a business aircraft and - in rare cases - also the maintenance of a particularly expensive motor vehicle lead to unreasonable expenditure (e.g. Maybach of a bar operator). Expenses for visiting night clubs are also excluded from the deduction , unless they are, for example, similar to a commission (Section 4 (5) No. 7 EStG). If expenses fall under Section 4 (5) No. 7 EStG, those parts of the costs that are appropriate (therefore “to the extent”) will be allowed to be deducted as operating expenses.
  • Fines , administrative fines and warning fines , if imposed by a German court, a German authority or an EU authority (Section 4 (5) No. 8 EStG)
  • Evasion interest on company taxes (Section 4 (5) No. 8a EStG)
  • Certain compensation payments (Sections 14, 17, 18 KStG) to shareholders
  • Bribes and kickbacks , insofar as punishable by fines or fines (Section 4 (5) No. 10 EStG)

Proof of business expenses

The taxpayer must prove which expenses are operationally induced. If it cannot be established with certainty that there are operating expenses, the tax office can refuse the tax deduction. The tax office can also require the taxpayer to name the creditor or recipient of business expenses. If the taxpayer does not comply with this request, consideration of the business expenses claimed can be refused ( Section 160 AO ).

Flat rate operating expenses

Only individual professional groups is a business expenses blanket authority. The corresponding regulations are not found in the Income Tax Act, but in the ESt notices (H 143 on § 18 EStG, from 2005 H 18.2).

  • For full-time freelance writing or journalistic activity, 30% of the income can be deducted as business expenses without receipt, up to a maximum of € 2,455.
  • For academic , artistic or writing secondary employment, including lecturing or part-time teaching and examination work, a maximum of 25% of the income can be deducted at a flat rate, a maximum of 614 €, and only if there is no activity within the meaning of § 3 No. 26 EStG .
  • Day care workers (childminders) can deduct € 300 per month as operating costs for each child for whom a weekly care period of at least 40 hours has been agreed. If the agreed weekly care time is shorter, only the corresponding portion of € 300 can be deducted, i.e. H. 300 € × weekly hours / 40.

See also


Individual evidence

  1. This formula pervades the case law of the Federal Fiscal Court , s. Decision of July 4, 1990 (C. II. 2. with further details) and last decision of September 21, 2009 and judgment of March 16, 2010 .
  2. U. a. Lastly, the Münster Finance Court (May 5, 2010, paragraph 68) refers to the BFH judgment of March 4, 1986 (VIII R 188/84) .
  3. BFH judgment of March 4, 1986 (VIII R 188/84) , II.1.
  4. "Sponsoring Decree" of the Federal Ministry of Finance id F. v. February 28, 1998, cf. Sponsoring: Considered as business expenses .
  5. ^ BFH judgment of February 19, 2004, Az. VI-R-135/01, BStBl. II 2004, p. 958 (on private shared use of a computer).
  6. BFH decision of September 21, 2009, Az. GrS 1/06, BStBl. II 2010, 672.
  7. BFH press release 1/2010 of January 13, 2010 ( online ).
  8. BMF letter of 6 July 2010 (coordinated state decree), BStBl. I 2010 p. 614.
  9. BFH judgment of November 3, 1961, Az. VI 196/60 U, BStBl. 1962 III p. 123.
  10. Heinicke in Ludwig Schmidt: EStG , 29th edition, Verlag CH Beck, Munich 2010, § 4 margin no. 486 mwN
  11. BFH judgment of December 11, 1980, Federal Tax Gazette 1981 II p. 460.
  12. BMF letter of May 11, 2009 IV C 6 ( BStBl 2009 I p. 642)