If you want to be successful in your career in the long run, you need to keep learning. In today’s professional world, a variety of continuing education and professional development programs allow you to keep learning new things even after you’ve completed your initial training. Whether you’re an employee or self-employed, broadening your horizons is of great importance. However, the costs of such educational seminars can quickly put a dent in your wallet. But don’t worry—various costs associated with continuing education are tax-deductible. Our tax advisors at our offices in Düsseldorf and Oberhausen have summarized how this works and what you need to keep in mind.
Continuing Education Costs and Taxes?
Continuing education expenses are costs incurred to stay up to date in one’s profession. Qualifications for re-entering the workforce also count as continuing education for the IRS. Employees can deduct the costs of continuing education and professional development as income-related expenses on their tax returns. A flat rate of €1,000 is already provided for in the Income Tax Act. If this flat rate is exceeded, the expenses should be reported on the tax return. Self-employed individuals, on the other hand, have the option to include their continuing education costs as business expenses. Costs for workshops or seminars are then reported on the profit and loss statement.
What requirements must be met?
Of course, certain requirements must be met for the tax office to accept the training costs as such. First, there must be a professional reason. It is your responsibility to prove that the reason is indeed professional and not personal. The tax authorities may request credible evidence.
It is also important that the event is specifically tailored to your professional group. If the content is general in nature, a tax deduction is often not possible. If you want to play it safe, you should have your employer and the event organizer issue a certificate. In case of doubt, this proves your professional specialization.
Which training costs are tax-deductible?
The costs of continuing education and training often go beyond just the participation fee. Our tax advisors have summarized below which expenses can be claimed for tax purposes:
- Fees
Participation in a training course is, of course, not free. The following can be deducted from taxes:
- Participation fees for courses and seminars
- Exam fees
- Work materials
Depending on the training program, you may need various work materials. So if you’ve purchased specific items specifically for your continuing education, these can be deducted. These include, for example:
- Professional literature
- Work clothing
- Stationery
- Laptop or similar
- Travel expenses
Many continuing education courses do not take place directly in your area. Therefore, travel expenses are incurred. These can be claimed using a travel expense allowance of 30 cents per kilometer. Both the outbound and return trips are taken into account. Alternatively, you can keep a logbook. However, this is very time-consuming, as you must maintain it throughout the year. With a logbook, the actual car expenses can then be deducted for tax purposes.
- Incidental travel expenses
Travel incidental expenses also add up quickly. Fortunately, these can also be claimed on your tax return. Common incidental expenses include, for example:
- Parking fees
- Luggage storage fees
- Interest on a loan to finance continuing education
- Accommodation costs
Training courses often involve stays of several days. Accommodation costs are sometimes covered by the employer. If this is not the case, hotel costs can also be claimed as income-related expenses. Ideally, you should have proof of the accommodation costs. If not, a flat rate of €20 per night may be claimed. If the training takes place abroad, different flat rates apply. If the accommodation price already includes meals, these costs must be deducted and may not be claimed as accommodation expenses.
- Meal Allowances
Unfortunately, meal costs cannot be deducted in full. Instead, there is a meal allowance. The following amounts can be deducted:
- €12 each for the arrival and departure days
- Full training days (24 hours): €24 each
As with lodging, different flat rates apply for training abroad.
Correctly reporting training costs on your tax return
As you already know, all costs for training and continuing education are reported as income-related expenses. Do you still have questions or need help with your tax return? As tax advisors in Düsseldorf and Oberhausen, we’re happy to assist you. Our team is highly knowledgeable about the various costs associated with training (not least due to our ongoing professional development) and is happy to answer any questions you may have. Contact us and schedule a consultation today.
