About mileage allowance in the travel expense report and AI?
Be careful when using ChatGPT. And which mileage allowance applies now?
What you need to know about the mileage allowance in Germany
The kilometre allowance, also known as the mileage allowance or commuter allowance, is an allowance that employees in Germany can receive for work-related journeys. In this blog article, we will take a closer look at the mileage allowance in Germany, what conditions must be met, how much the allowance is and what impact it has on your tax return.
What is the mileage allowance? The mileage allowance is a lump sum that employees receive to cover their travelling expenses for business trips. It serves as compensation for the actual costs incurred, such as fuel, maintenance, insurance and depreciation of the vehicle.
Conditions for the kilometre allowance: To be able to claim the kilometre allowance in Germany, certain conditions must be met. The journey must be for business purposes, for example for travelling to work, business trips or business trips. In addition, the journey must be made in your own vehicle and there must be no possibility of using public transport.
Amount of the kilometre allowance: The amount of the kilometre allowance is determined annually and can vary. For 2023, the kilometre allowance in Germany is 0.35 euros per kilometre driven. This means that you can claim 0.35 euros as a lump sum for every kilometre you drive for work.
Tax implications: The mileage allowance is tax-free and therefore does not have to be declared in the tax return. It is a lump sum that is automatically deducted from the tax. However, the mileage allowance is offset against the actual costs of the journeys. So if you have higher costs than the flat rate covers, you can alternatively declare the actual costs in your tax return.
Conclusion: The mileage allowance is an allowance granted to employees in Germany for business journeys. It serves as a lump sum to cover the costs of travelling to work, business trips or business travel. You can claim your travel expenses with the kilometre allowance of 0.35 euros per kilometre. However, please note the conditions and the possibility of declaring higher costs in your tax return. The kilometre allowance is a good way to financially cushion work-related journeys and at the same time benefit from tax advantages.
CAUTION CORRECTION
We have already written a number of blog articles on mileage allowances in the travel expense report and would like to expressly refer to the following once again:
how high is the mileage allowance for business trips
So why are we writing another blog about it here? There are two reasons. Firstly, our blog on mileage allowance is one of the most visited and read by you. This makes us very happy and shows how important the topic is and how much confusion there is.
The second reason is our promise to shed light on the topic of AI from time to time.
Have you noticed? The first section is not written by me, but by ChatGPT. Not bad at first glance. At second glance, it's noticeable that it's a bit generalised in places. But what is really fatal is that the content is wrong! ChatGPT has made the same mistake that many travellers make, even when they search the Internet. The mileage allowance for business travel, or rather the business use of a private car, has been mixed up with the mileage allowance for travelling from home to work.
So let's be very clear once again: Your employer CAN (but does not have to) pay €0.30 per kilometre if you have used your private car for a business trip. (ChatGPT is wrong with €0.35.)
When I write "CAN", this means that it is a voluntary benefit. The employer can also pay any other amount. For example, nothing at all or only €0.15 or even €0.45 or more. Depending on what you receive, this has an impact on your tax situation. Up to €0.30 per kilometre is tax-free for you in any case.
What do we learn from this?
In our first article on AI
artificial-intelligence-opportunities/risks
we made a clear commitment to its use. We actually see a lot of advantages and more and more will be added in the future. At the same time, however, there are also dangers or "traps". We have uncovered one of them here. Microsoft has linked the latest version of ChatGPT to its BING search engine.
So in future, stay vigilant with blog articles, marketing materials and even your own internet searches.
I actually ran the article (at the top) three times and it actually got better, but unfortunately not error free. This example shows how important it is not to blindly rely on software. Look for experts.
We see ourselves as a guide for our customers on the way to the summit of 100% digitalisation of processes and receipts in travel expense accounting. For this reason, we are now also offering free 1-hour consultations. In these 45 - 60 minutes, we will work with you to find out where you stand and what your specific path to digitalisation could look like.
If this is of interest to you, please book an appointment directly here.
In any case, as always, we look forward to your feedback.
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