Employment contract in Germany, residence in the UK, can I deduct flight costs, etc.?
August 27, 2012 | 25,00 EUR | answered by Wirtschaftsprüfer André Hintz
I live (main residence) in the UK and will be accepting a job offer in Germany. The place of work will be Frankfurt. I will not receive any reimbursement, so I will have to pay for flight costs, etc. myself.
I want to keep my main residence in the UK and therefore be in Frankfurt from Monday to Friday and have my second residence there. I will be in the UK on Saturdays and Sundays.
Therefore, taxation will be in Germany. Can I deduct my weekly flight costs, second residence expenses, etc?
Will there be any other taxes from the UK government side (DBA) that I will have to pay?
Dear inquirer,
I would like to answer your question within the scope of an initial consultation and based on your fee commitment, in accordance with the rules of the online portal. My response is based on the situation you have described.
If your main place of residence remains in the UK and you only come to Germany to work, you are subject to limited tax liability in Germany.
Therefore, the income you earn in Germany is taxable. In general, the tax deduction from your employer already has a final effect.
However, you can apply for an assessment by submitting a tax return to your tax office in Frankfurt. In this tax return, you can claim all advertising costs related to your income, as long as the law does not oppose it in individual cases.
Please note that the double household management is subject to strict conditions. For example, you must demonstrate that your main place of residence remains in the UK and that you have your own household there. The second residence must be located at your place of work in Germany. You can then claim the flight costs as family home trips.
If you earn income outside of Germany, these are taxable in the UK if the UK follows the worldwide income principle like Germany. The double taxation agreement only prevents income from being taxed twice or not at all. However, it may be that the UK subjects the income from Germany to progression clause. In this case, this income is taken into account when determining the tax rate. However, only a tax advisor from the UK can and may provide you with more detailed information on tax law in the UK.
I hope my explanation has been helpful to you and remain
Yours sincerely,
André Hintz
Tax advisor
