When can single people claim dual household maintenance?
Single individuals can also claim the costs of maintaining a second household as business expenses. One of the requirements is that they maintain their own household.
An own household is a furnished apartment,
- which represents the centre of your life interests,
- which you use by your own right or derived right,
- in which you "maintain" or co-maintain a household, i.e. determine or significantly co-determine the household management,
- and financially contribute to the household costs (new from 2014).
Of particular importance is the question of whether you use the apartment free of charge or for a fee and whether you financially contribute to the household management. An "own household" in the case of a second household is only recognised if the single employee financially contributes to the household costs (§ 9 Abs. 1 Nr. 5 EStG 2014).
It is not sufficient if the employee, for example, only occupies one or more rooms in their parents' household or if the employee is given a flat in their parents' house for free use. It is required that the financial contribution to the household management costs is not merely trivial amounts (BMF letter dated 24.10.2014, BStBl. 2014 I p. 1412, para. 100).
- If the cash payments exceed 10% of the regularly incurred monthly running costs of the household management (e.g. rent, ancillary rental costs, costs for food and other daily necessities), a financial contribution above the trivial limit is assumed.
- If the cash payments are less than 10% of the running household costs, the employee can demonstrate sufficient financial participation in other ways, e.g. financing joint holidays, car costs or major purchases.
- How should a single person demonstrate their financial contribution to the household management in the tax return? As there is no query line for this in the tax form, they should simply wait for a possible inquiry from the tax office.
The Lower Saxony Finance Court ruled in 2019 that an employee's financial contribution to the main household is sufficient to recognise a second household for tax purposes (judgment of 18.9.2019, 9 K 209/18). A financial contribution can be made directly (e.g., cash payments to parents) or indirectly (e.g., costs for household items or renovations). The contribution does not have to be regular, and one-off payments are acceptable.
Recently, the Federal Finance Court confirmed the judgment of the Lower Saxony Finance Court and rejected the excessive requirements of the tax authorities (BFH judgment of 12.1.2023, VI R 39/19).
A case was described: The claimant had rented a flat at the place of work and lived in a non-self-contained flat in his parents' house together with his brother. A missing rental contract was not considered a problem. The claimant stated that he had contributed a total of 3,160.47 Euro to the household costs in 2015. The tax office rejected the deduction because the claimant did not prove that regular monthly costs had been incurred. The claimant's action was successful.
The law requires a financial contribution to the costs of the main household, including the costs of living space and living expenses. One-off payments and irregular costs are sufficient. A financial contribution should be reasonable compared to the actual household costs. However, the amount cannot be determined as a flat rate and depends on the circumstances of the individual case.
It is recommended to lodge an objection if the tax office rejects the claim and to set up monthly payments to avoid disputes. It is advisable to take into account the ten percent limit of the tax authorities by covering more than ten percent of the monthly regular household management costs.
Note that the Federal Finance Court's ruling cannot be applied to cases where younger children go home at weekends and only use their youth room (BFH judgment of 12.1.2023, VI R 39/19 and Lower Saxony Finance Court, judgment of 18.9.2019, 9 K 209/18).
