Include full travel costs for customer visits

Bosses in the skilled trades should not be fobbed off with the lower travel allowance when it comes to trips to customers, advises the Taxpayers' Association.

This article is part of the special topic Tax bonus for tradesmen's invoices: What you should know

Employees can claim travel expenses for the outward and return journey. However, the business owner cannot. For entrepreneurs, tax offices often only want to recognize the flat-rate travel allowance for the one-way trip if they regularly visit a customer. However, a ruling by the Düsseldorf Finance Court is now giving entrepreneurs and the self-employed a boost: The court allowed the full travel expense allowance (case no. 10 K 829/11 E). The tax office has appealed against this taxpayer-friendly ruling to the Federal Finance Court inserted. The Taxpayers' Association supports the appeal proceedings (case number XR 13/13) as a model case.

Do not accept a low approach

Affected entrepreneurs should rely on this procedure and do not accept a lower flat-rate travel allowance for customer visits, advises the Taxpayers' Association. If the Federal Fiscal Court follows the lower court's ruling, the businesses will be entitled to the full travel expense allowance. Businesses who keep their tax assessment open with an objection have the opportunity to reclaim the overpaid taxes. An objection must be filed within one month of notification of the tax assessment.

You might also be interested in:

Operations management

Distance allowance: Now you can also take a detour

Operations management

First responders: Eight double lessons that can save lives

Operations management

Always announce travel costs!

Regular customer visits

The affected person was self-employed in the field of IT organization. In 2008, he only looked after one client, whom he regularly visited in his company car. He claimed the costs for the outward and return journeys as business expensesHowever, the tax authorities assessed the journeys as journeys only between home and business premises and applied the lower travel allowance of 30 cents per kilometre – i.e. only for the one-way journey – as business expenses. The tax court demands equal rights for employees and employers. The self-employed person appealed to the Düsseldorf Finance CourtThe judges followed his opinion and assumed that the a customer’s business establishment is not a permanent establishment of the plaintiffIn its justification, the Finance Court cited the case law of the Federal Fiscal Court regarding employee cases. According to this ruling, a customer's business premises are not a regular place of work for an employee.

The Düsseldorf Finance Court ruled that this assessment must also apply to businesses, allowing the full travel expense allowance. It now remains to be seen whether the Federal Finance Court will follow the Düsseldorf Finance Court's taxpayer-friendly view, according to the Taxpayers' Association.

Source: Taxpayers' Association NRW