Replacement care allowance
May 17, 2021 | 40,00 EUR | answered by Steuerberater Bernd Thomas
Hello everyone,
In the years 2019 and 2020, I was involved in taking care of my friend's grandmother to a small extent.
In mid-2019, she applied for a so-called replacement care allowance (annual €2418). It was paid out to her in July 2019. At the beginning of 2020, she then paid me the amount for 2019 retrospectively as well as in advance for 2020 in cash.
In the context of the 2020 income tax return, I now have the following questions:
1) Is the replacement care allowance taxable at all? According to my research, this should not be the case according to §3 no. 36 EStG. There should be a moral obligation, as my friend's grandmother is the only person I care for. However, I am not directly related to her.
2) Do I have to declare it in the 2020 tax return? If so, how do I deal with the fact that I received both the amount for 2019 and for 2020 in 2020? Do I need to correct the 2019 return (which I did not declare it in)? Will this cause any issues for me? If I were to declare both the 2019 and 2020 amounts together in 2020, I would exceed the maximum amount stipulated in §3 no. 36 EStG and would become liable for tax, even though it should be tax-free.
Thank you very much for your help and best regards.
Dear inquirer,
I am happy to answer your inquiry based on the information provided in the context of an initial consultation on frag-einen.com. The response is based on the facts you have provided. Missing or incorrect information may affect the legal outcome.
1)
A tax exemption (§ 3 No. 36 EStG) only applies if you take on the care out of a moral obligation. A moral duty is assumed only if not only you would consider it improper to act otherwise, but also your fellow citizens (these somewhat formalized formulations originate from the BFH case law). Usually, reference is made to a close family relationship, and this may also apply to partners in a marriage-like relationship or engaged couples.
In my opinion, being the girlfriend of the grandson will not be sufficient.
A tax exemption under § 3 No. 26 EStG is also, in my opinion, not applicable as the care is not carried out on behalf of an institution listed in the law (see Merker in Fuhrmann/Kraeusel/Schiffers, eKomm Ab VZ 2018, § 3 No. 36 EStG Rz. 2 (updated on 28.12.2018)).
2)
You report the income in the year of receipt, regardless of when you actually received the money (and regardless of the application of an exemption provision).
Due to the sustainability (two years), a declaration as income from other services is ruled out, so this would be declared as income from a business operation or possibly, if you become subject to instructions, as income from employment, from which no tax deduction has been made.
You could try to treat it as tax-free under § 3 No. 36 EStG, but then, to avoid tax evasion, you must inform the tax office in the "Supplementary information for the tax return" section of the main form and explain.
Sincerely,
Bernd Thomas
Tax consultant
Information according to DL-InfoV: Tax consultant Dipl.-Kaufmann (FH) Bernd Thomas, Tax consultant, Neustadtswall 85, 28199 Bremen, member of the Hanseatic Chamber of Tax Consultants Bremen, registration number 111705, professional liability insurance with R+V Allgemeine Versicherung AG, Mittlerer Pfad 24, 70499 Stuttgart, insurance sum: 250,000 euros for each individual case of damage; annual maximum benefit: 1,000,000 euros (for all damages in one insurance year); the professional regulations of §§ 3, 3a, 32, 43 Steuerberatungsgesetz apply (regulations can be viewed at: http://www.gesetze-im-internet.de/stberg)
