Higher Education in Germany

Court allows students to offset uni costs from future income taxes

Court allows students to offset uni costs from future income taxes
Photo: DPA
Students in Germany should start collecting receipts – a court has ruled their university costs can be offset against income taxes once they start working.

The Federal Fiscal Court ruled just this week that tax offices should no longer refuse to recognise outlays incurred during study time as legitimate work-related expenses and thus tax-deductible costs.

The court came to the same conclusion in two different cases where professionals whose attempts to write off student expenses had been refused.

The Süddeutsche Zeitung reported on Thursday that a pilot claimed costs of nearly €28,000 against his income for 2004, resulting in a loss. His argument was that the training and associated costs should be seen as work-related for his future job as an employed pilot. The second case was that of a medicine student who had made a similar argument.

The tax offices and later also lower courts, rejected these arguments as the costs had not been incurred during actual employment.

Costs covering rent while at college, possible university tuition fees, computers and books for a period of study or training can quickly reach five figures, the paper reported.

Even those students who work during their study, often remain within the tax-free allowance, it suggested. The new ruling could deprive government coffers of considerable amounts of students’ future income.

However, the Finance Ministry could still issue a ‘decree of non-use’ to instruct tax offices to not follow the court’s ruling, according to Der Spiegel.

German universities are expecting a flood of students this year as military conscription ends, resulting in an expected 60,000 increase in the number of new higher education enrolments.

The Local/hc

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