Deduct political donations and election aid from tax

Frankfurt The general election is over. Joy or disappointment have spread – especially among those who have previously been involved in monetary or voluntary work. After all, the tax authorities will put a smile on the face of all supporters. Because regardless of whether the effort was worth it, those who are politically active can state the expenses in their tax return and thus save a lot of taxes.

In election years, the Germans are traditionally particularly generous towards the parties. Until shortly before the polling stations opened, the parties represented in the Bundestag had raised around 11.5 million euros from donations of more than 50,000 euros. This is shown by the figures published by the German Bundestag.

For comparison: In the whole of last year it was only 2.2 million euros that companies, business associations and individuals donated. Classically, such large donations increase significantly in election years, and this should also apply to smaller donations.
In contrast, most parties have been struggling with falling membership numbers for years. Only the Greens and the AFD could look forward to growth in recent years.

While party donors can decide for themselves how much they want to support a party, the parties set their membership fees in advance. They usually fluctuate between one and four percent of net income and increase as earnings increase.

Top jobs of the day

Find the best jobs now and
be notified by email.

Deduction limit for amounts of money

“Membership fees and donations to political parties are tax-deductible for singles up to a total of 3300 euros, for married couples and registered partners up to 6600 euros,” explains the United Wage Tax Aid eV (VLH).

The financial contributions are therefore recorded as a single item in the tax return. However, the crediting takes place in two steps:

First of all, half of all contributions and donations up to an amount of 1650 euros for singles (married: 3300 euros) are deducted directly from the tax liability, i.e. a maximum of 825 euros (1650 euros).

Every euro that exceeds the annual amount of 1650 euros (married: 3300 euros) can then be deducted as “special expenses” – at least up to a further 1650 euros (married: 3300 euros).

Example: Ms. Müller is single and pays a total of 2500 euros to a political party in one year, made up of her membership fee and a monetary donation. She claims 1650 euros as a tax reduction and pays 825 euros – half – less in taxes in the year in which the membership fee or donation is paid.

She also claims the remaining 850 euros as special expenses (2500 euros – 1650 euros = 850 euros). This is the amount of your taxable income and, as a result, your tax burden.

But don’t worry, the tax office will take care of the bill. All taxpayers who give money to a party only need to enter the total expenses once in the “Special expenses” annex. “The tax office takes care of everything else,” the VLH experts know.

Simplified proof

For donations and membership fees up to a limit of 300 euros, a “simplified proof”, for example a bank statement, is sufficient to indicate the amount in the tax return. By 2020, the limit was 200 euros. “The amount applies to each individual donation, not to the total amount of donations made in the year,” explains the VLH.

An official donation receipt – also known as a “donation receipt” – is only required for larger amounts. In general, the evidence only needs to be presented if the tax office asks the taxpayer to do so.

Anyone who volunteered to post election posters, distributed flyers or helped with election campaign appointments can also deduct the working hours they have worked for. The keyword is “remuneration donation”.

For this, the helper must have agreed an appropriate remuneration with the party in writing, but waives the payment after the activity. Instead, he or she receives a donation receipt.

The volunteers can in turn enter this amount as special expenses in their tax return, where it reduces the taxable income and consequently also the tax burden.

Tax-free refreshments

Many lend a hand on election day. They set up voting booths, identify voters, supervise ballot boxes and count the votes in the evening. The insight into the heart of democracy is only available on a voluntary basis. However, in recognition of their commitment, all election workers receive what is known as “refreshment money”. In Baden-Württemberg it is called “Zehrgeld”.

In the case of Bundestag and European elections, the amount is up to 25 euros per election worker and 35 euros for an electoral board. In state and local elections, the sums differ slightly and are different within the federal states and municipalities.

Regardless of the amount of the refreshment allowance, it is always an expense allowance for a privileged voluntary activity. And this is basically tax-free. “Election workers do not have to state the refreshment allowance in their tax return,” says the VLH.

More: Our 45-page PDF dossier tax return guide 2020: How to get the most out of the tax authorities

.
source site