Deducting Business Expenses: What Self-Employed Can Deduct from Taxes

As a self-employed person, you can deduct many expenses from taxes and thus reduce your profit - and with it your tax burden. Here you'll learn what's all deductible and what you need to pay attention to.

What are business expenses?

Business expenses are all expenditures that are caused by your business (§ 4 Abs. 4 EStG). They reduce your profit and thus your income tax.

Basic rule: An expense is deductible if it's business-related and you can prove it (receipt).

The most important business expenses

1. Work equipment and office furniture

• Computer, laptop, tablet
• Software and licenses
• Printer, scanner, monitor
• Desk, office chair
• Telephone, smartphone
• Office supplies

Depreciation: Purchases over 800 € net are depreciated over several years. Under 800 € you can deduct immediately (GWG).

2. Rooms and rent

• Commercial rent (100% deductible)
• Home office (under certain conditions)
• Utilities, electricity, heating
• Cleaning

Home office: Only deductible if it forms the center of your activity or no other workplace is available.

3. Vehicle and mobility

• Vehicle costs (proportional or logbook)
• Mileage allowance: 0.30 € per km (from km 21: 0.38 €)
• Public transportation
• Bicycle (also e-bike)
• Parking fees, tolls

Logbook vs. 1% rule: With predominantly business use, the logbook is often worthwhile.

4. Travel expenses

• Travel costs (see above)
• Accommodation costs (actual costs)
• Meal allowance (flat rates)
• Travel incidentals (luggage, tips)

Meal allowance 2025:

• From 8 hours absence: 14 €
• From 24 hours: 28 €
• Overnight stay: 28 € (arrival/departure day: 14 €)

5. Communication

• Telephone and mobile (proportional private/business)
• Internet
• Fax, postage
• Domain, hosting

Estimation allowed: For mixed use, you can estimate the business share (e.g., 50%).

6. Insurance

• Professional liability
• Business liability
• Legal protection (business share)
• Disability insurance (as special expenses)

7. Continuing education

• Specialist literature
• Courses, seminars, workshops
• Conferences, trade fairs
• Online courses, webinars
• Coaching

Prerequisite: Professional relevance must be given.

8. Marketing and advertising

• Website, hosting
• Advertising materials (flyers, business cards)
• Online advertising (Google Ads, social media)
• Trade fair appearances
• Gifts to customers (max. 50 € per person/year)

9. Consulting and services

• Tax consultant
• Lawyer
• Accountant
• Freelancers, subcontractors
• Virtual assistance

10. Account management and finance

• Account management fees (business account)
• Interest on business loans
• Factoring fees
• Payment processing (PayPal, Stripe)

Non-deductible expenses

• Private living expenses
• Private clothing (even if worn at work)
• Fines and penalties
• Private taxes (income tax)
• Private insurance (health, pension)

Tips for practice

1. Collect receipts

No receipt, no deduction. Collect all receipts and invoices systematically.

2. Separate business and private

The cleaner the separation, the fewer discussions with the tax office. Own business account is mandatory.

3. Use depreciation

Larger purchases are depreciated. This spreads the tax savings over several years.

4. Plan investments

Invest before year-end? This can reduce profit in the current year.

5. Ask tax consultant

For complex cases, professional advice is worthwhile. The costs are also deductible by the way.

Conclusion

As a self-employed person, you have many opportunities to reduce your tax burden. The most important thing: Collect receipts, document properly, and ask the tax consultant when in doubt.

With Clever Invoice, you keep track of your expenses: Capture all receipts digitally, categorize automatically, and export for the tax return.