Tax handling of relocation expenses

[Beer-Monster 8]

I've wound a considerable bill in relocation costs moving from Belgium to work in Germany and have now found that the costs are not tax deductible.

 

Has anyone reading this had a similar experience? Or is my accountant just wrong?

[YorkshireLad6 7,152]

Why are they not deductible? If the move was a requirement of your work, or you are moving into a new job, then most if not all costs, including travel for house-hunting, house-agency costs, removal costs, and some kitchen equipment (oven and hob) should be deductible, assuming they have not been paid prior by your employer... Even a move for private reasons has some element of tax advantage (20% of the removal costs up to €3,000)...

[eurovol 126]

Yeah, get a new accountant. I suggest you join a tax verein. €15 a year membership and your taxes are done for free. Ah, or something like that. It is still a great deal!

[Beer-Monster 8]

Will changing the accountant make a difference though - the rules about what can be claimed back are changing. Relocation costs are usually high, so it is a good way of maximising tax revenue but not letting freelancers' claim them off wages before tax.

[YorkshireLad6 7,152]

If they are changing (and I'm not sure they are) then it's not relevant - the rules for the year of your relocation apply...

[emacintyre 164]

Also, if you moved for education or training all expenses should be deductible. (according to my German office mate)

[Starshollow 6,070]

YL6: the OP says he is a freelancer, not an employee... I am not sure if self-employed can write of their moving expenses - but then I am not such a tax expert like you and FREISING. is there a difference between moving as an employee and as a self-employed person?

 

Cheerio

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[YorkshireLad6 7,152]

 

is there a difference between moving as an employee and as a self-employed person?

 

I don't believe there is - "Voraussetzung für einen Abzug von Umzugskosten als Werbungskosten ist die ausschließliche berufliche Veranlassung" - which I interpret to be simply a relocation for professional reasons...

 

Even if it didn't count then there is an element of tax recovery from "Haushaltsnahe Dienstleistungen" even as a private person...

[Beer-Monster 8]

It maybe because of the receipt for moving expenses. It was from a sole trader who helped me to move rather than a Company. Perhaps the receipt has to be from a professional company registered in an EU country.

 

Sole traders are much harder to tax than an employee. It would involve a lot of administration to find and tax the sole trader that helped me move in the first place, perhaps it is just easier to tax me instead.

[YorkshireLad6 7,152]

I have to say, it's really not up to your accountant to reject such a receipt. It should simply be submitted as part of your tax claim. In many cases the claims are simply rubber-stamped through. If a taxman checks a little deeper, it's up to him to raise his doubts and reject the receipt as valid for your claim (whereupon standard practice in the first instance is to appeal). That should not just be your only receipt, however. What about House-hunting costs, Agency costs, travel costs, kitchen costs? Far be it from me to suggest tax-fraud, but not all of these have to be actual costs incurred, just receipts that make it appear so, if you know what I mean (nudge, nudge, wink, wink).

Sounds like time to find a new accountant who is a little more creative with his/her thinking

[Beer-Monster 8]

Sounds like the accountant is playing it safe. Considering there was Police raid on his office a while back, I can see why.

 

As you say, maybe time for to change my accountant.

[YorkshireLad6 7,152]

 

Sounds like the accountant is playing it safe.

 

EXACTLY the reason to change...

The prefect accountant is a shifty little weasel...

[Beer-Monster 8]

Yeah, but changing isn't easy as you think as they always ask who the last one was ;)

[barry2104 95]

(from YSL): "Even a move for private reasons has some element of tax advantage (20% of the removal costs up to €3,000)..."

 

can anyone confirm that this^ is still current and true for the 2011 financial year? If so, are the cost of air/travel included in this amount?

 

I just moved here from Australia and have just started to look for work, though have had a fair bit of help setting up my (our) new place from my fiancee's family (helped us find a furnished apartment that we moved into straight away, etc). So there actually haven't been many costs incurred on our behalf to make the move here, other than the flights (which were purchased as return tickets btw) and a few odd bits n pieces around the apartment we purchased this week...

glad i have a full year to worry about submitting a tax return here, but want to know what sort of receipts i NEED to keep, and which to put in the "should keep but might not be necessary" receipt pile...

[Sampa 99]

Resurrecting this thread to ask a new question.

 

I just started a new job with a relocation allowance, and now I have to present receipts for my moving expenses. The company policy seems to be that they will reimburse for the same things that I could claim on a tax return. Foolishly, I paid for my family to fly here with frequent flyer points, and luckily, I found an apartment without commission. So even though moving has cost a fortune in terms of furnishing a new place, I find myself without many receipts to present for moving expenses. Some questions:

 

1. I read you can claim for the cost of oven and stove. We took our kitchen over from the previous tenant and paid him for the whole thing. Is there a way to claim for this? If I ask the previous tenant to give me some form of written receipt, what format would it require?

 

2. We hired a car for a few weeks when we first got here, at least partly for the purpose of apartment hunting. Would that be claimable?

 

3. Is there any way to put a monetary value on frequent flyer points, and therefor claim them as an expense?

 

Any other info also highly appreciated

[YorkshireLad6 7,152]

If your company is following the tax allowance guidelines then you can claim (against tax) a fixed fee of 1390€ in respect of moving expenses for a married couple plus 306€ for each family member without any receipts. You can also claim 230€ for a kitchen hob and 163€ per room (in the apartment) for an oven, also without receipts.

 

You can't claim directly for car rental, but you can claim an allowance for necessary travel involved in the move or in finding a new home - 0.30€ per km.

 

Your flight (rather foolishly) didn't cost you anything, so there is nothing really you can claim but many airline schemes allow you to buy additional miles so maybe you can work out the value of the miles you used from their cost to buy.

 

Remember if your company refunds all the expenses above then you can't claim them from tax any more - at least not in theory :)

[Sampa 99]

Thanks YL6 - that is very helpful

 

Its a long shot, but does that mean if I moved from Brazil I can claim 0,30€ per km between Sao Paulo and Munich!?

[YorkshireLad6 7,152]

If you have a car that could make the journey overland...

[Sampa 99]

hmm... might be hard to convince HR of that.

[Tim Hortons Man 543]

 

You can also claim 230€ for a kitchen hob and 163€ per room (in the apartment) for an oven, also without receipts.You can't claim directly for car rental, but you can claim an allowance for necessary travel involved in the move or in finding a new home - 0.30€ per km.

 

We moved here last year and are facing the same thing, the company paid for the movers and makler (very happy on that one!!!) and gave us an allowance for the move up.

 

Got a phone call schedule with our tax guys (using TT advertiser Exapt Tax) so will run some of this by him!