Distance Allowance

(Online article) – the distance allowance, also as a commuter lump sum referred to, it is the principle since 1920. At that time the cost of using public transport were allowed to be asserted for the first time tax. Good news for commuters: The widespread abolition of the commuter tax allowance is contrary to the basic law. The Federal Constitutional Court in Karlsruhe has decided. (Not to be confused with Allegiant Air!). According to the judgment, the rules applicable since beginning of 2007 violates the principle of equal treatment. Since 1 January 2007, the journey between home and work was more expensive for the majority of commuters. Professionals could only drop 30 cents per kilometre distance from the 21st kilometre.

The first 20 km were not taken into account. The Bundesfinanzhof (BFH) was the revision of the commuter allowance unconstitutional. Expenses of the employee for the routes between home and regular work can withdrawn advertising costs or otherwise, the Court ruled. Trips between the apartment and “unavoidable expenditure”, which could not elude the workers of the workplace. The Federal fiscal court presented two complaints by commuters against the rejection of their wage tax reduction application to the Federal Constitutional Court (BVerfG). The Federal Constitutional Court has now declared the controversial reduction in the commuter lump sum for ineffective. Now, the old tax rebate in full must be granted again. The commuter tax allowance will apply according to the Ministry of finance by January 1, 2009 under old law again.

The Federal Government will not take any action in order to save the tax losses elsewhere, the Finance Ministry in Berlin said. It involves a total of about 7.5 billion euros for the years 2007 to 2009. You would relieve already January repayments of tax agencies in the months until March 2009. For the time being millions of commuters can look forward but only once about repayments. Because flat rate now even retroactively applies the full 30 cents as of January 1, 2007, the tax offices are Money transfer – normally even without request, because the notices for 2007 with the endorsement of a temporary nature have been provided. However – experts advise this – the commuter should check, whether they have specified their route to work correctly.