How do I deduct my moving costs from my taxes? (Umzugskosten)

If a new phase in life is about to start that means, above all, change. Not everyone handles it that easily. You leave your dear friends behind, settle into a new city and, last but not least, a new employer that you naturally want to impress.

In order to be able to usher in a new beginning, usually a move is necessary for this. This should be organized as well as possible in order to keep stress levels down. Order is half the battle. Finding a suitable date, buying boxes, wrapping knick-knacks, renting a suitable van or possibly booking a removal company - all of this is very expensive.

Some employers also contribute to relocation if, naturally, it is due to work. They can even pay all costs in full. But not every boss is so generous. Then incurred expenses can still be deducted in your tax return. Now, you'll find out what you should look out for.

What needs to be taken into account?

First, it should be clarified whether it is a private or a professional move. Depending on the starting position, the expenses are applied later in the tax return. In general, relocation costs can be assigned to different categories:

Moving costs can be:

  • Special expenses
  • Operating expenses
  • Advertising expenses
  • Exceptional charges
  • Household services

Professional relocation

If someone relocates for professional reasons, the expenses can be stated as advertising costs in the tax return. However, there are certain conditions, at least one of which must be met in order for the costs to be recognized by the tax office.

These include:

  • Moving as part of professional double household management
  • Relocation is at the request of the employer
  • Travel time (round trip) is shortened by at least one hour
  • Starting a new job
  • Change of job
  • Relocation

Moving costs and lump sum

The actual incurred removal costs can be stated in the tax return. There are certain items that are readily recognized by the tax office.

Deductible costs include:

  • Travel expenses for relocation preparation
  • Rental compensation for up to six months if there is a double rental charge
  • Tutoring costs for children
  • Registration fees
  • Telephone costs
  • Kitchen installation
  • Lamp installation
  • Moving company
  • Realtor fees
  • Viewing costs

In Germany, there is also a removal fee, which is € 764 for 2018. The amount is doubled for married couples and another € 337 for each additional person in the household.

What can't be deducted from taxes?

There are also items related to relocation for a job that the tax office does not recognize.

These include:

  • Capital losses and expenses for the previous residence
  • Realtor fees when buying a new house near the place of work
  • Storage costs
  • Expenditures for renovation and equipment in the new residence
  • Additionally, removal costs can be deducted in other ways. The reason for the move plays an essential role.
  • Depending on the initial situation, these include:
  • Special expenses if someone has moved due to their first vocational training
  • Extraordinary expenses, if a move is necessary due to health reasons or natural disasters (reasonable burden limit must be exceeded)

By the way: some expenses incurred for a private move may be tax-deductible within the context of household services.

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