How do I rent out my employees

Domestic study Rent for the home office

If an employee uses a room in his apartment as a study, the unrestricted allowance for income-related expenses for the expenses attributable to this room can only be considered if this room is the focus of the employee's entire professional activity. If this is not the case, but no other workstation is available for the activity, the expenses can be deducted up to 1,250 euros per year. In addition, it is generally not possible to deduct the room costs for the study (see Section 4 (5) sentence 1 no. 6b of the Income Tax Act).

However, if the employer pays a rent for the use of the study as a home office, a full allowance for income-related expenses can be achieved. So far, this has even been the case, even if in the long term no surplus of income over advertising costs, but only losses from the provision of the study were to be expected. In this respect, the intention to generate income was simply assumed. Recently, however, the Federal Fiscal Court no longer adhered to this view. As a result, the tax authorities only allow losses from letting to the employer, for which no sustainable surplus is expected, for deduction if the lease was concluded before January 01, 2019. In addition, the tax authorities take the following view:

The home office "rented" to the employer only leads to income from renting and leasing if this use is in the overriding interest of the employer. This is indicated by the fact that the company does not have a suitable workplace for the employee, that attempts by the employer to rent such rooms from third parties have been unsuccessful or that comparable rooms have been rented for other employees from third parties. In addition, there should be a written agreement on the terms and conditions of the employee's premises being given to the employer. In these cases, the employer's payments result in rental income; the expenses incurred on the apartment are deductible as income-related expenses for the employee without restriction, if long-term surpluses can be generated through the rental.

However, if a workplace is available for the employee in the employer's company, this is an indication that the use of a home office as a home office is predominantly in the interests of the employee. If the employer pays a fee for using the home office in this case, this is part of the tax and social security wages. The expenses incurred for the home office can then only be deducted as income-related expenses in accordance with § 4 Paragraph 5 Clause 1 No. 6b EStG if the room is the focus of the entire professional activity.

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