In the case of double household management, rent and trips home can be claimed in the tax return, among other things.
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Berlin Whether it’s an attractive place to study or an interesting job offer – the place of training or work is not always close enough to your home town to commute every day. For many, the question arises as to whether a complete move or a second home suits their needs better.
In the case of young people, for example, the close connection to their parents’ house and circle of friends often provides important arguments for a second place of residence. If the decision is made accordingly, there will at least be relief in income tax.
If the necessary requirements are met for two residences, the tax office recognizes double household management. Rent, furnishings and meals for the second home as well as trips home can be stated as income-related expenses in the tax return, which reduces the tax burden.
It should be noted, however, that a taxpayer makes a sufficient financial contribution to the costs of the main residence. This also applies if it is in the parents’ house and no rent has to be paid for it. A young man on whose case the Federal Fiscal Court has currently decided (Az. VI R 39/19) experienced how high these requirements can be.
In addition to a rented apartment near his place of work, he and his brother lived rent-free in an apartment on the upper floor of his parents’ house that was not structurally separated from the other rooms. As a share of the costs incurred, he paid his father a one-time payment of 1,200 euros in December for additional costs and telecommunications, as well as 550 euros as a contribution to new windows. He also bought groceries and drinks worth 1,400 euros for his brother and himself.
Requirements for the amount of the cost sharing at the main residence
For 2015, the young man finally applied to his tax office for expenses for keeping two households to be taken into account and claimed costs for the second home and family trips home. However, the authorities refused this because they lacked proof of sufficient financial participation in the household run with the parents and brother.
>> Read here: This is how the Treasury helps with setting up the second home
The clerk pointed out that the food purchases only affected the taxpayer’s own needs. In addition, it did not recognize the retrospective one-off payment at the end of the year as sufficient cost participation.
The young man appealed to the tax office of Lower Saxony against the opinion of the tax office. There, the judges were more generous in their assessment and recognized the type and amount of the contribution to the financial expenses of the multi-generational household as sufficient.
The Federal Fiscal Court subsequently shared this opinion and rejected the appeal by the tax office. The judges pointed out that no fixed financial limit has to be exceeded for cost sharing. A one-off payment at the end of the year is also permitted.
Contribution should be more than ten percent
Above all, it is crucial that the taxpayer contributes to the costs of living space and household management. This includes, for example, expenses for rent and ancillary costs or the municipal real estate taxes and renovation costs for your own home.
This also includes expenses for electricity, newspapers, groceries, internet and telephone. It is important that the share is actually paid as a cash payment. On the other hand, working through household chores is not accepted as participation.
Whether the amount of the costs assumed is to be regarded as sufficient is always determined on a case-by-case basis. The amount paid must be viewed in relation to the expenses actually incurred for the year as a whole.
>> Read here: The second home is empty during parental leave – so it can still be deducted
In any case, the contribution to costs must exceed the so-called de minimis limit of ten percent. The costs incurred must be presented to the tax office and proven on request. Invoices serve as receipts for housing costs and regular household expenses. Expenditures of different amounts such as for groceries and household necessities can be estimated.
Practical tip: A joint household account makes it easier to provide proof
If you want to claim costs in connection with running two households, you should consider the verifiability of the expenses you have paid from the outset. This applies all the more when grown-up children keep their main residence in the parents’ house free of charge. It is always advisable to set up a joint account into which all residents of the house or apartment pay a fixed share.
Are you interested in this tax tip? You can find more articles at our cooperation partner Haufe.de.
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