Moving to Germany for Work? How to Deduct Relocation Costs in Your German Tax Return (2025–2026 Guide) 

Moving to Germany for a job can easily cost €5,000–€10,000 or more once you include flights, temporary housing, and moving services. Many expats are surprised to learn that a large part of these costs may be tax deductible in Germany, especially when moving from abroad. 

If your move was related to starting a job in Germany, German tax law may allow you to deduct: 

This guide explains exactly what expats can deduct in their first German tax return and how to avoid the most common mistakes. Our first-hand experience can help you significantly reduce the financial burden that your relocation to Germany may entail.  

This article is based on the following legal sources:  

Can I Deduct Moving Costs to Germany From Abroad? 

Yes, relocation costs can be tax-deductible if the move was required for employment. 

Germany treats job-related relocation expenses as income-related expenses (“Werbungskosten”). Typical qualifying situations include: 

In many cases, even expenses incurred before arriving in Germany can be included in your first German tax return. 

Example 

An engineer moves from the U.S. to Munich to start a new job. Deductible expenses may include: 

These costs can reduce taxable income significantly in the first year. 

How Much Is the Relocation Lump Sum in Germany (2025 / 2026)? 

Germany allows a flat-rate relocation allowance for miscellaneous moving expenses. For relocations beginning from March 2024 onward (including 2025 and currently 2026): 

Household	Lump Sum
Single person	€964
Each additional household member	€643

This lump sum can be claimed without providing receipts. Typical expenses covered by the lump sum include: 

Prinz.tax practical insight: With proper reference to the legal basis (BMF letter dated 28 December 2023 (IV C 5 – S 2353/20/10004 :005), these costs can be claimed in your income tax declaration even if you no longer have the receipts or other documentation. 

Which Moving Expenses Are Tax Deductible in Germany? 

If your move is considered job-related, the following costs are usually deductible: 

Travel and relocation costs 

Apartment and housing costs 

Administrative expenses 

Other relocation costs 

For larger expenses, the tax office usually requires receipts or invoices. 

Is Temporary Accommodation Tax Deductible in Germany? 

Yes, temporary housing during relocation is often tax deductible. Temporary housing costs may include: 

These costs are typically deductible while searching for a permanent apartment after moving for work.  

In our experience, it is very common for expats because finding housing in major German cities can take several weeks or months and often involves significant costs. 

Deducting Double Rent During a Job Relocation 

If you must temporarily pay two rents, the overlapping costs may be deductible. However, some restrictions apply. This situation often occurs when: 

The following example illustrates the situation where an expat is moving from Boston to Berlin: 

The two months of overlapping rent may be deductible as relocation expenses. 

Are Real Estate Agent Fees Tax Deductible? 

Yes, agent fees for finding a rental apartment can be tax deductible if the move is job-related. 

This can be significant because agent commissions in Germany can equal two months’ rent plus VAT. Many expats overlook this deduction. 

Common Mistakes Expats Make With Relocation Expenses 

Many expats accidentally miss deductions worth thousands of euros. Typical mistakes include: 

• not claiming expenses incurred before arrival in Germany 

• forgetting temporary housing deductions 

• missing agent fee deductions 

• failing to document double rent 

• assuming international relocation expenses are not deductible 

In our experience there are potential pitfalls, because cross-border relocations involve two tax systems, the rules can quickly become complex. Please note that a deduction for a specific expense cannot be claimed in two countries. Also, employer reimbursements disqualify a deduction. 

Comprehensive Tax Deduction Checklist for Expats Moving to Germany 

1. Travel Costs 

• Flight tickets for all family members relocating 

• Train, bus, or other transportation tickets to Germany 

• Shipping costs for household goods (sea, air, or land freight) 

• Fuel, tolls, or mileage reimbursement for a personal vehicle used for relocation 

• Parking or storage fees related to transportation of goods 

2. Moving & Logistics Costs 

• Moving company invoices (domestic and international) 

• Packing materials (boxes, tape, protective material) 

• Temporary storage of household goods 

• Insurance for shipped goods 

• Dismantling/reassembly of furniture 

• Pet transportation fees (if moving pets for work) 

3. Housing Costs 

• Rental contracts for new apartment(s) 

• Temporary accommodation invoices (hotels, serviced apartments, Airbnb) 

• Real estate agent/broker fees (Maklerprovision) for job-related relocation 

• Utilities setup fees (electricity, water, internet) if paid during move 

• Security deposits (sometimes considered relocation costs if required by employer) 

• Cleaning costs for previous residence (if required by lease) 

• Overlapping/double rent payments during transition 

4. Professional & Legal Services 

• Legal fees for work permits, visas, or residence permits 

• Lawyer fees for immigration advice or work permits 

• Fees paid to relocation agencies for job-related relocation support 

• Tax advisory fees for cross-border tax planning related to relocation 

• Translation or notarization of documents required for employment or registration 

5. Administrative & Registration Costs 

• Registration fees at the local Bürgeramt (Anmeldung) 

• Address change notifications 

• Vehicle registration and licensing fees 

• School registration fees for children if moving for work 

• Immigration or residency registration fees (Ausländerbehörde) 

6. Employment Documentation 

• Employment contract 

• Proof of job start date (offer letter, onboarding documents) 

• Evidence of employer reimbursement for any relocation costs 

7. Miscellaneous Expenses 

• Internet/phone setup costs for work-related needs 

• Language courses if required for employment (sometimes deductible if job-mandated) 

• Short-term furniture or appliance rental in temporary accommodation 

• Tips for movers or helpers 

• Small incidental items for moving (lamps, curtains, minor installations) 

Need Help With Your First German Tax Return as an Expat? 

We hope that this article brought some clarity in tax implications for moving costs. If you recently moved to Germany, your first tax return can be complicated. Many expats request our assistance because they need help with: 

• claiming international relocation expenses 

• coordinating U.S. and German tax obligations 

• understanding which costs are deductible 

• optimizing first-year tax benefits 

At Prinz.tax, we specialize in tax services for expats living in Germany, including first-year tax returns after relocation. If you would like professional assistance, we will be happy to assist you.