Außergewöhnliche Belastungen: Calculating Extraordinary Burdens in Tax Returns

Private expenses do not have any place in a tax return. However, if your expenses are necessarily higher than those of other taxpayers with the same income and family status, then you have an extraordinary burden or ‘Außergewöhnliche Belastung’. Section 33 of the Income Tax Act defines these expenses as unavoidable if they are inevitable for “legal, factual or moral reasons”. They must therefore be necessary and unavoidable.

They are deducted from your total income. You enter them in lines 61 – 68 of the tax return:

Many costs fall under extraordinary burdens. We have listed some examples here.

Medical Expenses

Medical expenses are a classic example of extraordinary expenses. Expenses for glasses, hearing aids, wheelchairs, dentures, or co-payments for prescriptions are just a few typical examples of medical expenses that you can deduct.

It is important that the medical measures are necessary and prescribed by a doctor. Paragraph 64 of the Income Tax Implementation Ordinance prescribes the cases where you have to provide the tax office with which special proof. If costs are partially reimbursed by the health insurance fund, you may only deduct the part that you paid yourself. Preventive measures are not included.

Spa Expenses

You can deduct spa costs from your taxes if you have a medical certificate from the medical service of your health insurance company. Expenses that are not reimbursed to you can be deducted as extraordinary expenses. These can include:

• • Accommodation costs

• • Travel costs for the journey

• • 80% of the additional costs for meals

• • Medical expenses

• • Spa costs

Nursing Costs

You can deduct care costs incurred due to illness. However, you can also deduct extraordinary expenses that have resulted from caring for another person (your own parents, spouse, children). This includes, for example, accommodation in an old people’s home or the expenses for an outpatient carer.

You have to prove that you need care. To do so, use the certificate from the long-term care insurance fund or a private long-term-care insurance company. If a person in need of care is blind or helpless, this is stated on their ID card (Bl or H) and can be used as proof.

For the care of relatives, you can also claim the lump-sum care allowance of 924 Euros (2020). As of 01.01.2021, this amount was raised to 1,800 Euros and, thus, almost doubled. If your real costs are lower than this, it is better to use the lump sum. However, this only applies to helpless persons or relatives with care level III.

Lump sums for disabilities

In the case of a disability, you can either deduct the actual costs incurred as extraordinary expenses or use the disability lump-sum. The lump-sum depends on the degree of disability.

Amount of the disability allowance for the tax return 2018, 2019 and 2020

If you use the lump-sum disability allowance, you are no longer allowed to deduct the actual care costs related to the disability. All expenses incurred by people with disabilities or those in need of care are then covered.

Funeral Expenses

If you have paid for the funeral of a relative, the corresponding expenses are deductible. However, you can only enter those expenses in your tax return that exceed the amount of the estate. If there is death benefit insurance or ‘Sterbegeldversicherung’, this will also be deducted.

The tax office then covers the direct funeral costs: gravesite, coffin, wreaths, flowers, obituaries. Costs such as catering for the mourners at the funeral service do not count as extraordinary burdens and cannot be deducted.

Replacement Costs

In the event that unforeseeable disasters, such as a flood or fire, have destroyed your valuable items and household, the replacement costs are extraordinary burdens. This also includes the costs for clean-up work.

The damage alone does not count as an extraordinary burden. You must have financial expenses. In addition, the amount of the costs must be reasonable and they must not exceed the value of the replaced item. Residual values of objects are offset against the costs of replacement.

Extraordinary burdens and their tax deductibility have one hurdle: The reasonable burden or ‘zumutbare Belastung’. Only the part that exceeds this limit is deducted from your total income.

Each burden limit is individual. The tax office calculates it as a percentage of your total income. Your marital status and the number of your children also play a role: singles have a higher reasonable burden than married people with children.

The reasonable personal burden is calculated step by step.

It is not easy to exceed the reasonable burden limit. Therefore, it is worthwhile to concentrate on expenses that can be planned and are considered extraordinary burdens in one calendar year. If you distribute payments around the turn of the year (in this year or the following year), you can strategically influence your burden limit.

Before the end of the year, check whether you can lower your reasonable burden by one percentage point, for example, if you reduce your total income through income-related expenses.