New overnight allowance for professional drivers

Since 1 January 2020, a nightly allowance applies for professional drivers who sleep in the cab of their lorry. Prior to this, drivers could only estimate their actual costs and claim them as travel expenses for tax purposes or have them reimbursed by their employer. These often included expenses for:

• the use of sanitary facilities (showers, toilets) at service stations,
• cleaning the sleeping cabin.

Since 1 January 2024, the overnight allowance is 9 Euro per calendar day (§ 9 Abs. 1 Satz 3 Nr. 5b EStG). This allowance is in addition to the meal allowance and can be claimed by professional drivers as business expenses.

Application of the overnight allowance

The overnight allowance can be claimed for:

• the day of arrival or departure,
• each calendar day with an absence of 24 hours during a business trip in Germany or abroad.

The allowance replaces the actual overnight costs. The amount of the actual expenses is irrelevant as long as the driver has incurred costs. Alternatively, higher proven costs can also be claimed. It is important that the choice between the allowance and actual expenses must be made uniformly for the entire calendar year.

Typical deductible additional expenses

Deductible additional expenses covered by the overnight allowance include, among others:

• fees for toilets and showers at service stations,
• parking and storage fees,
• costs for cleaning the sleeping cabin.

New overnight allowance for professional drivers

New meal and accommodation allowances 2024

The Federal Ministry of Finance has published new meal and accommodation allowances for business-related foreign travel for 2024. These affect how employees and employers handle tax deductions and reimbursements.

For business-related foreign travel and double housekeeping abroad, the Federal Ministry of Finance announces country-specific meal and accommodation allowances each year.

• Employees can deduct the meal allowances as business expenses, or employers can reimburse them tax-free. It is not possible to claim the actual costs as business expenses.
• The accommodation allowances cannot be deducted as business expenses, but the employer may reimburse them tax-free. Only the actual and proven accommodation costs are deductible.

The Federal Ministry of Finance has recently announced changed travel expense rates for a number of countries for 2024, i.e., meal and accommodation allowances (BMF letter dated 21.11.2023).

The tax-free payment of the accommodation allowance by the employer is also permitted if you have incurred lower or no accommodation costs, for example, when staying with friends. However, if the actual accommodation costs are higher, you can deduct the difference as business expenses.

New meal and accommodation allowances will apply from 2024 for the following countries:

Equatorial Guinea, Australia, Barbados, Brazil, Hong Kong, Dominican Republic, Djibouti, Fiji, Finland, Georgia, Guinea, Italy, Cameroon, Canada, Cuba, Lebanon, Madagascar, Morocco, Mauritius, Mongolia, Mozambique, New Zealand, Norway, Paraguay, Philippines, Sierra Leone, Spain, Sri Lanka, South Sudan, Trinidad and Tobago, Chad, Tunisia, Vatican City, Central African Republic

New meal and accommodation allowances 2024

What additional travel expenses can I deduct?

In addition to travel expenses, accommodation and meal allowances, you can also deduct other costs incurred in connection with your off-site work. These include, among others:

• Parking fees, tolls, garage rental
• Telephone charges for business calls
• Entrance fees for business events
• Luggage storage fees
• Costs for currency exchange and loss on repurchase
• Compensation for traffic accidents
• Damage to travel luggage
• Theft of items (professionally used items, private items taken for business purposes, necessary personal travel items)

Loss of money or jewellery is not reimbursed.

For many incidental travel expenses, there are no receipts. You can still claim these in your tax return. Create a self-issued receipt with the location, date, type and amount of the expense and submit it.

If you do not know the exact amount of an item, estimate it. Many tax offices accept an estimated amount if it is plausible.

What additional travel expenses can I deduct?

What can I deduct for off-site work?

Deductible Expenses for Off-Site Work

For business-related off-site work, you can claim various expenses as income-related expenses, including:

• Travel expenses
• Meal allowances
• Accommodation costs
• Additional travel expenses

Meal allowances are only considered for the first three months of a long-term off-site work assignment.

1. Travel expenses

Travel expenses can be deducted either at actual cost or, if using your own car, at the business travel allowance rate (30 cents per kilometre driven).

2. Meal allowances

• 14 Euro for an absence of 8 to 24 hours.
• 28 Euro for an absence of 24 hours.

The time you are away from your main residence and primary workplace counts. Travel times are also considered.

3. Accommodation costs

Accommodation costs are fully deductible for the first 48 months. After that, a limit of 1.000 Euro per month applies, but only for overnight stays in Germany. There is no limit abroad.

4. Additional travel expenses

Various additional costs can also be deducted, including:

• Travel at the destination (e.g. taxi, rental car)
• Motorway or ferry fees
• Parking fees
• Tips
• Telephone costs or business correspondence.

Overnight Allowance for Truck Drivers

Truck drivers can claim an allowance of 9 Euro per calendar day (until 2023: 8 Euro) in addition to the meal allowance. This applies to arrival and departure days as well as calendar days with a 24-hour absence during off-site work.

What can I deduct for off-site work?

When is off-site work applicable?

A business trip occurs when you work temporarily outside your home and your "primary place of work" for business purposes.

A business trip is "temporary" if you are expected to return to your primary place of work and continue your duties there.

• An employee can have only one "primary place of work" per employment contract. Any work outside the primary place of work is considered a business trip.
• In certain cases, the employee may not have a primary place of work at all. In this case, the work is entirely a business trip. This applies to professional drivers, taxi drivers, train drivers and train attendants, pilots and flight attendants.
• If you are employed on a vehicle: Each new journey constitutes a new business trip.
• If you interrupt long-term work assignments: If the interruption lasts at least four weeks, a new business trip begins. This is important for the deduction of meal allowances, which are only considered for the first three months. Since 2014, the reason for the interruption no longer matters, so holidays or illness can also lead to a new start. Until 2013, an interruption due to illness or holiday had no impact on the three-month period.

When is off-site work applicable?

What should I know about the new 48-month limit?

What should be considered regarding the 48-month limit for off-site work?

For off-site work, travel, accommodation, and incidental travel expenses, as well as meal allowances, can be deducted as business expenses. Since 2014, the 48-month limit has played a central role.

1. 48-month limit at the first place of work

A "first place of work" is a fixed business location to which the employee is permanently assigned. A permanent assignment is assumed if the employee:

• is assigned indefinitely ("until further notice"),
• for the entire duration of the employment relationship, or
• for a period of more than 48 months

Tip: If the assignment is limited to up to 48 months, there is no first place of work. Therefore, travel costs can be claimed according to business travel allowances, and meal and accommodation costs can be claimed as business expenses or reimbursed tax-free.

2. 48-month limit for work at a customer's premises

Under the new law, the first place of work can also be at a customer's premises, for example, in long-term projects or temporary work. Such an assignment exists if the employee:

• is assigned from the outset for longer than 48 months, or
• for the entire duration of the employment relationship

3. 48-month limit for accommodation costs

Since 2014, accommodation costs for off-site work can only be fully deducted for 48 months. From the 49th month, they are limited to 1.000 Euro per month – but only for domestic work.

Tip: An interruption of the activity for at least six months resets the 48-month period.

Important case law

The Münster Finance Court ruled that repeatedly limited assignments of less than 48 months each do not constitute a first place of work, even if the total deployment lasts longer than four years (Münster Finance Court, 25.3.2019, 1 K 447/16).

Special conditions for temporary agency workers

Temporary agency workers are in an employment relationship with the lender, not the borrower. They can only have a first place of work if they are:

• assigned indefinitely,
• for the duration of the employment relationship, or
• for longer than 48 months

Journeys to the first place of work can only be deducted using the distance allowance. Meal and incidental travel expenses are not applicable. For shorter assignments, however, reimbursement can be made according to travel cost principles.

The Lower Saxony Finance Court ruled that travel costs can only be deducted using the distance allowance, even for fixed-term assignments (ruling of 28.5.2020, 1 K 382/16). However, the Federal Fiscal Court overturned this ruling (Federal Fiscal Court ruling of 12.5.2022, VI R 32/20). The decisive factor is the employment relationship between the temporary agency worker and the lender. Repeated fixed-term assignments do not constitute a permanent assignment.

Changes due to the Temporary Employment Act (AÜG)

Since 1.4.2017, a temporary agency worker may be employed by the same borrower for a maximum of 18 months (§ 1 para. 1b AÜG). The question arises as to whether this regulation has tax implications for the assessment of the first place of work. The Federal Fiscal Court will decide on this in case VI R 22/23.

Those affected should appeal against negative tax assessments and apply for the suspension of the proceedings.

What should I know about the new 48-month limit?

What can be deducted for work on a vehicle?

If you work on a vehicle, you generally do not have a "main place of work", so your work is considered off-site work. This applies to:

• Professional drivers
• Coach drivers
• Bus drivers
• Tram drivers
• Refuse collectors
• Taxi drivers
• Train drivers (except works railway drivers)

You often need to report to a pick-up location to take over the vehicle. Here are the main tax-deductible expenses for such work:

1. Journeys between home and pick-up location

For these journeys, you can only claim the distance allowance:

• 0.30 Euro per kilometre,
• 0.38 Euro from the 21st kilometre.

2. Meal allowances

If you are away from your home and main place of work for more than 8 hours, you can claim meal allowances in addition to the distance allowance:

• 14 Euro for 8 to 24 hours absence,
• 28 Euro for 24 hours absence.

3. Overnight allowance for professional drivers

Professional drivers can claim an overnight allowance of 9 Euro per calendar day (until 2023: 8 Euro). This allowance is in addition to the meal allowance and can be claimed for the following days:

• Arrival and departure days,
• Every calendar day with a 24-hour absence during off-site work in Germany or abroad.

Current decisions

• Works railway drivers have a main place of work at the deployment area, but not a large-scale work area (Federal Fiscal Court (BFH) ruling of 1.10.2020, VI R 36/18).
• Refuse collectors do not have a main place of work at the depot if they only listen to tour announcements and collect vehicle documents there (BFH ruling of 2.9.2021, VI R 25/19).

What can be deducted for work on a vehicle?

What is deductible for multiple places of work?

If your employment contract requires you to work at two or more workplaces, such as the main office and a branch, one must be designated as the "primary workplace". Your employer can do this based on their right to issue instructions. Alternatively, the extent of your working hours may be decisive: A workplace is considered your "primary workplace" if, according to your employment contract, you work there

• typically on a daily basis, or
• two full working days per week, or
• at least one third of your agreed regular working hours.

If several workplaces meet the conditions for a "primary workplace" in terms of duration of work or working hours, the following rule applies:

• The primary workplace is the one designated by the employer. It does not have to be the workplace where you perform the majority or most significant part of your work.
• If the employer does not exercise their right to designate or if the designation is unclear, the primary workplace is the one closest to the employee's home.

What is tax deductible?

• Journeys between your home and the "primary workplace" can only be deducted using the commuting allowance.
• Work at other workplaces is considered business travel, so journeys can be deducted using the business travel allowance (30 cents per km travelled) or the actual costs.
• In addition, meal allowances can be deducted as business expenses or reimbursed tax-free by the employer, provided the absence is at least 8 hours.

What is deductible for multiple places of work?

What applies to business trips abroad?

There are some special tax regulations for off-site work abroad:

(1) Meal allowances: These vary depending on the country. Special rates are set for particularly expensive cities. The allowances are derived from the Federal Travel Expenses Act and are announced by the Federal Ministry of Finance from time to time.

• For each full day of absence, the country-specific meal allowance is 120%, and
• on days with an absence of more than 8 hours as well as on
• arrival and departure days, it is 80% of the highest foreign daily allowances.

(2) In-flight meals: In-flight meals are usually included in the airfare. If the invoice for the flight ticket is issued to the employer and reimbursed by them, the following applies:

The free in-flight meal is considered a "meal provided by the employer". This means that the meal allowance must be reduced by 40% for lunch or dinner and by 20% for breakfast. The meal allowance is not reduced if it is clear from the chosen fare that it is a pure transport service with no free meals provided.

(3) Multiple countries: If you visit several countries during your off-site work, the meal allowance is always based on the country you reach last before 24:00 local time. On the return day, the country in which you were last working is decisive - not Germany. This also applies if you continue your off-site work in Germany, for example, by visiting a customer in Germany.

(4) Overnight allowances: For overnight stays abroad, the country-specific overnight allowances can no longer be deducted as business expenses, but only reimbursed tax-free by the employer. If the off-site work abroad lasts longer than four years, there is no limit on the deductible accommodation costs to 1.000 Euro per month for the 48 months, unlike in Germany.

The Federal Fiscal Court (BFH) has ruled that employees without a fixed first place of work must also reduce the meal allowances if the employer provides them with free meals (judgment of 12.07.2021, VI R 27/19).

The case: A ship's officer received free meals on board from the employer, which were shown as tax-free benefits in the payroll statements. On port days, the officer did not always use the on-board meals and occasionally had to provide for himself. He claimed meal allowances as business expenses for a total of 206 days.

The judgment: The BFH ruled that the officer may only claim the meal allowances for days on which he did not receive meals from the employer, such as on port days. On the other days, when breakfast, lunch, and dinner were provided free of charge, the deduction of the meal allowances is excluded.

The Düsseldorf Fiscal Court ruled that free meals provided to flight personnel on flights of over six hours are not taxable wages (judgment of 13.08.2020, Az: 14 K 2158/16 L).

Background: An airline provided its staff with free meals on longer flights. The tax office considered this to be taxable wages, but the court rejected this. The meals were provided predominantly in the employer's operational interest to ensure smooth flight operations.

Conclusion: The provision of meals primarily serves the employer's legal obligation and not the reward of the staff. Therefore, they are tax-free.

What applies to business trips abroad?

What applies when meals are provided by the employer?

During off-site activities, such as training events, seminars, conferences, sales events, etc., participants are often provided with meals at the employer's expense, either directly by the employer or at their instigation by a third party, e.g. the conference hotel or a catering company.

The beneficiary is taxed on this benefit.

The relevant meal allowance is reduced. The reduction is 20% for breakfast and 40% for lunch or dinner of the full meal allowance. Taxation at the official rate for benefits in kind only occurs if the employee cannot claim meal allowances as business expenses, e.g. for absences of less than 8 hours or for long-term off-site activities after the three-month period. The limit for "standard meals" is 60 Euro.

Currently, the Federal Fiscal Court has ruled that meal allowances must also be reduced for employees without a "primary place of work" if the employer provides them with free meals (BFH ruling of 12.7.2021, VI R 27/19).

The case: A ship's officer receives free meals on board from the employer. In the wage statements, the employer showed these meals as tax-free benefits in kind. On "port days", the officer did not always take advantage of the on-board meals provided. On certain days, the crew had to cater for themselves in ports. The officer claimed meal allowances for 206 days as business expenses.

According to the BFH, the officer is only entitled to meal allowances for the days when the employer did not provide meals on port days. For all other days, the deduction is excluded, as breakfast, lunch, and dinner were provided free of charge on those days.

What applies when meals are provided by the employer?