Brexit and the craftsman bonus

Brexit also has consequences for the tax deductibility of tradesmen’s services.

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

If the United Kingdom leaves the European Union, however and whenever that may be, household-related services and tradesmen's services provided there will no longer be tax deductible. 

Background: In the 2008 Annual Tax Act, effective from 2007, the German legislature decreed that all households in the EU and the European Economic Area (EEA) could deduct their household-related services and tradesmen's services from their taxes – provided the holiday home owners remained taxable in Germany. This abolished the previous restriction to German households.

So far: Anyone subject to tax in Germany who renovates their home in the UK or has a gardener maintain the garden of their British holiday home can declare the costs in their German income tax return, according to the Vereinigte Lohnsteuerhilfe (VLH). Specifically, up to 20 percent of the invoices for tradesmen's services, or a maximum of €1.200 per year, can be deducted from their taxes.

After Brexit: If the UK leaves the EU, these tax advantages will disappear completely.

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By the way: According to the 2011 Federal Statistical Office microcensus, approximately 8.000 workers commute between Germany and Great Britain. For them, the UK's exit from the EU will not change anything in terms of commuter allowances or dual household management.

Source: United Income Tax Assistance