Looking to hire in Germany

In Germany, employees must submit expense claims promptly to remain eligible for reimbursement. Current-year expenses must be submitted within 60 days of the expense date or within 30 days after returning from a business trip, whichever is later. Prior-year expenses must be submitted no later than February 1 of the following year.

Different documentation rules apply above and below 250 EUR. Where a tax invoice is required, it must be issued to the employer and show the employer’s name and address; for expenses incurred in the European Union, it should also include the vendor’s VAT ID. Employees can confirm the correct employer entity name in their employment agreement. Screenshots are not accepted as valid supporting documentation for any expense.

Phone, internet, and coworking costs can be reimbursed, but tax treatment depends on usage, amount, and whether call logs are provided. Documentation requirements also vary by amount, and incomplete support can lead to reclassification as a taxable allowance.

Work tools such as laptops, office equipment and supplies, software, and postal charges are generally reimbursed tax-free when properly documented. Documentation requirements tighten as the amount increases, with higher-value items typically requiring a tax invoice and, in many cases, employer details and VAT information.

Most business travel costs are reimbursed on a non-taxable basis when supported by appropriate tickets, receipts, or tax invoices. Documentation requirements vary by amount and type of travel, and some items must show the employee’s name. Mileage is reimbursed at a fixed non-taxable rate per kilometer.

Meal and entertainment costs are typically reimbursed tax-free when linked to business travel or business purposes and supported by the right level of documentation. For regular meals, tax treatment depends on whether they are incurred during business travel and correctly indicated in the claim.

Professional development and event-related costs can be reimbursed on a non-taxable basis when they relate to the employee’s work and are properly documented.

Employers may pay a per diem to cover meals during business trips. When a per diem is used, employees cannot also claim personal meal or grocery expenses for the same travel period.

Under EU Directive 90/270/EEC, employers must reimburse necessary protective eyewear and eye exams for employees who work with screens, provided the need is medically certified. These reimbursements are non-taxable, subject to an annual limit for eyewear.

In Germany, bonuses such as contractual or discretionary payments, incentives, and commissions are treated as regular income. They are subject to income tax and social security contributions, with taxes withheld at source under progressive tax rates, which can lead to higher withholding in pay periods that include bonuses.