Which costs for the purchase of an office chair and other work equipment for your home office can you deduct from your taxes? Who bears the costs and is the home office also supported by the state? The most important home office tax tips at a glance.
Even before the corona virus, home offices and mobile working played a role in many companies. But since the pandemic and the temporary home office requirement that was introduced as a result (there is no longer a home office requirement in Germany since July 1, 2021), it has become clear to everyone else: the home office is now indispensable. But, especially if you work a lot from home, you absolutely need good office equipment. An ergonomic office chair, for example, should be a MUST. Because a makeshift kitchen table and kitchen chair is very unhealthy in the long run and concentrated work is not possible. When it comes to the home office in your own four walls, many employees inevitably ask themselves one question: How can I deduct the home office from my taxes? We'll explain it to you.
Home office tax tips for employees
1. Purchase of an office chair by the employer
First of all: This is the best and most cost-effective option for you. If your employer provides you with an office chair (preferably an ergonomic one) for your home office, you can use it privately in addition to your professional activities. This equipment for your home office is tax-free. This means that you do not have to declare the office chair to the tax office as a benefit in kind from your employer and pay tax on it.
2. Agreement on a home office allowance with the employer
Your employer can also subsidize your home office equipment with a grant of up to 1,500 euros. This home office flat rate also covers the use of your private telephone and internet connection, for example. This means that you can of course also use this flat rate to purchase office furniture. To clarify the home office arrangements with your employer, either speak to the responsible people in the HR department directly or contact your department head first.
3. Home office allowance as business expenses in the tax return
In order to provide tax relief for employees, the Federal Government introduced the so-called home office flat rate as part of the 2020 Annual Tax Act. This home office flat rate stipulates the following:
- Employees who work from home receive a flat rate of 5 euros per day, but a maximum of 600 euros per year.
- When it comes to the daily flat rate, it is irrelevant whether your boss has ordered you to work from home or whether you are working from home voluntarily
- The flat rate only applies if you worked exclusively from home on the working day. If you were in the office for an appointment, for example, this day can no longer be claimed for the home office flat rate
- The home office allowance is considered business expenses and must be declared accordingly in the tax return
- Initially, the new home office allowance for 2020 and 2021 is limited
You can deduct the equipment you need for working at home - for example your office chair - from your taxes.
Important: In order for working from home to have a positive effect on your tax return, the total business expenses must exceed the annual flat rate of 1,000 euros for business expenses. This is because this amount can be claimed as a flat rate for tax purposes anyway, even if you have not incurred any business expenses at all.
That's why buying an ergonomic office chair for your home office is doubly worthwhile. Firstly, for your health - your back will thank you - and secondly, for tax purposes. If you buy the office chair for your home office on your own account, you can claim it as a business expense. This is also possible if you don't have your own office, i.e. just a work corner or something similar.
An office chair is considered a low-value asset (LVA). The purchase price for a LVA is 800 euros net. This means that the office chair can be fully deducted in the year of purchase if the purchase price is up to 800 euros net.
What you absolutely have to pay attention to: If the office furniture is more expensive than 800 euros net, you have to spread the costs over the expected period of use. This is usually 13 years. This is the officially set lifespan for office furniture. And even if you use the office chair for private use for more than 10 percent of the total period of use, you can only deduct the costs proportionately from the tax office.
Of course, other costs such as rent, electricity and heating for a home office can still be claimed as tax deductions. Work equipment can also always be declared and deducted in the tax return.
It is important that when purchasing your office chair, you make sure that it costs less than 800 euros - like the Aeris Swopper here, for example - so that you can deduct the costs from your taxes in one go.
4. Declaration as extraordinary expenses in the tax return
Another way you can claim the cost of an ergonomic office chair on your tax return is the so-called "extraordinary burden". This applies when there are medical reasons for a healthy, ergonomic active office chair. This is the case, for example, if you have had an operation or an accident, or as a measure after a slipped disc or something similar. However, the reasonableness limit according to Section 33 of the Income Tax Act must be exceeded. For singles without children with an income of up to 15,340 euros, it is five percent of total income. In this case, expenses of more than 767 euros per year are tax deductible.
Documentation is important – collect evidence
As with all tax matters, it is advisable to carefully keep all receipts for purchases when working from home. You should also document the workplace situation on different days and at different times with photos. A certificate from your employer for the home office requirement during the Corona period (if possible with the date and number of hours) can also be very helpful.
Home office tax tips for freelancers and self-employed
Even before the Corona year, freelancers and self-employed people had a regulation in place that allowed them to deduct purchases such as office chairs and tables. Since 2018, new office equipment with a net purchase price of up to 800 euros can be fully deducted from taxes in the year of purchase. However, if the purchase price exceeds 800 euros, the purchase no longer falls under the limit for low-value assets (GWG) and must be depreciated as office furniture over 13 years according to the Federal Ministry of Finance's Afa table.
Home office tax tips for companies
The following also applies to companies: If the purchase costs for an office chair amount to up to 800 euros, an immediate business expense deduction can be made within the framework of the regulation for low-value assets according to Section 6 Paragraph 2 of the Income Tax Act.
Another tax advantage arises when the expenses for a large number of office furniture items with acquisition costs between 250 and 1,000 euros are combined. In this case, a so-called pooling solution is possible: entrepreneurs can bundle the assets mentioned above into a collective item and write them off over five years. In concrete terms, this means that a company that now buys 20 high-quality office chairs worth 800 euros each can deduct 16,000 euros from tax for this year - or 3,200 euros each for five years.
Good to know: Despite the Corona crisis, this is how you can kill two birds with one stone. Business owners invest in the health and performance of their employees with office chairs that strengthen their backs and promote movement, while at the same time reducing their tax burden.
Home office costs: More financial support from employers and the state desired
In addition to the tax deductibility of a home office, the question of subsidies from employers and the state for home offices also arises again and again.
According to an Aeris home office study from 2020 with 2,000 people surveyed, more than a third of employees expect both their employer and the state to contribute more to the costs of a home office workplace. But why is more government support necessary? Two thirds of those surveyed already complain about health problems when working from home and have therefore already invested in an ergonomic office chair or a height-adjustable desk, for example, at their own expense.
More than 35 percent of respondents would like more financial support from the state and employers when it comes to home office equipment
When working from home, many employees still have to improvise. For example, many convert the kitchen or dining room table into a desk and the kitchen chair into an office chair. This could be improved by a government subsidy for the purchase of ergonomically correct office equipment. According to the Aeris study, 54 percent of those surveyed said that the office furniture in their home office was significantly worse than in the office. The result: health problems such as back pain, tension in the neck and shoulder area, or headaches.
Only 18 percent of those surveyed had their employer fully equip their home office space, and 27 percent had part of the costs reimbursed by the employer. However, 20 percent bear the costs for furniture and technology in their home office themselves. 37 percent of study participants expect more financial support from their company for the equipment. And 35 percent of those surveyed also believe that the federal government has a duty to contribute to the costs of the corona-related home office, for example through additional tax benefits.
State funding “go-digital” for SMEs
However, the government is not completely inactive when it comes to supporting home offices. With the "go digital" funding program, for example, the federal government supports small and medium-sized companies and craft businesses in setting up digital structures for home office workplaces. Up to 50 percent of the costs can be covered.
The Federal Office for Economic Affairs and Export Control (BAFA) is also currently offering a funding program: BAFA Corona Consulting. A business consultant funded by BAFA supports companies in digitally adapting to the new world of working from home and in further business planning. Companies that have run into difficulties due to Corona are entitled to BAFA funding for setting up home office jobs. The advice is funded up to a maximum amount of 2,700 euros.
Disclaimer: Please note that we are not permitted to provide tax or legal advice and this information does not constitute tax or legal advice. It is merely general information about the products we offer, which must be adapted to the respective facts of the individual case and assessed from a tax and legal perspective. Please seek advice from your tax or legal advisor tailored to your circumstances before making any decisions on issues arising in connection with our products. No liability is accepted.
