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Germany MOF Releases Court Decision Clarifying Expense Deductions for Off-Duty Use of Employer-Provided Vehicles

Oct. 4, 2022, 5:00 AM

The German Ministry of Finance Sept. 29 released Tax Court Decision No. VI R 35/20, clarifying the deductibility of expenses for off-duty use of employer-provided vehicles. An employee maintained a second home for professional reasons and used an employer-provided car for weekly, off-duty family trips home. The employee paid the employer an additional, monthly flat-rate fee for off-duty usage of the vehicle. The employee deducted expenses for these family trips home as income-related expenses. The tax office denied the deduction. The lower court upheld the denial. Upon appeal, the tax court held that: 1) the income tax law bans income-related ...