There are many different travel expenses that qualify for tax deductions on the condition that they relate to your work. You can already now claim deductions for any commuting and travel expenses in 2023. Submit the expenses for tax card.
You can claim the deductions, or make corrections to the expenses you have already reported on paper: Forms 1A, 1B, 1C or 1D are available. If you submit something on paper, do not report the same details again in MyTax.
Commuting between home and work
You are normally allowed to claim expenses by the ticket prices of public transportation. If you drive to work, your car expenses are not deductible unless specific conditions apply.
A business trip is temporary travel because of your duties of work. So: it is not a business trip for tax purposes when you commute every day between your home and work.
Travelling within special sectors of work
For tax purposes, “special sectors” include the construction sector, the earthmoving sector and the lines of work that are related to forestry. If you receive no coverage from your employer for your trips (i.e. your work trips to any “special place of work”), you are entitled to claim them as expenses and receive deductions.
Going home for the weekend
Do you work and stay overnight away from home during the week? The allowed deductions depend on whether the location where you work is your “permanent place of work” or just a location where you work on a temporary basis.
Travelling to a secondary place of work
Trips between your accommodation and the business locations are treated differently from trips from your permanent home to the same locations.
Threshold of 750 euros in 2023 and 2022
There is an amount defined as the individual taxpayer's own liability i.e. the threshold when the deduction starts to take effect. The own-liability threshold for commuting and travel expenses is €750 in 2023 (and 2022). The maximum deduction to be granted is €8,400 for tax year 2022 (and 2023). This means that you get the maximum deduction when you have paid €9,150 for travel or commuting in the course of the year (€8,400 is the maximum cost in 2022). You must report the entire expenses: in other words, the €750 that you must consider your own liability must be included in the expenses you claim. Do not subtract it.
If you have had a period of unemployment in the course of the year, the threshold is adjusted downward. If you are unemployed, the threshold is lower: each full month when you have received unemployment allowance (= 21.5 days) reduces it by 70 euros. However, the lowest possible threshold is €140. The Tax Administration calculates the deductions given to the unemployed: this means that also in this case, you must not subtract that amount from the expenses.
You cannot get the entire sum of travel and commuting expenses to yourself
Commuting expenses (travel expenses) reduce your taxable earned income for the year. This way, they do not reduce your taxes. Instead, they reduce your income.
For example, if your total expenses amount to €4,400, it does not mean that you would get €4,400 as a tax refund. It only means that your taxable income is reduced by the accepted deduction. You can estimate how much it is reduced by multiplying the deduction by your withholding rate.
Example: Markku makes €40,000 a year. If he didn't have any other deductions than those granted automatically by the Tax Administration to all taxpayers who earn income, his tax rate would be 25% and he'd pay 25% × €40,000 = €10,000 every year in income tax.
However, his commuting expenses amount to €4,400 adjusted by €750 of own liability, and resulting in €3,650 as deductible commuting expenses. His net taxable earned income equals €36,350 (€40,000 minus €3,650). Now his tax rate is 21% and he pays 21% × €40,000 = €8,400 in income tax.
This way, Markku's €4,400-commuting expense reduced his income tax by €1,600 (€10,000 minus €8,400). If he had wanted to get an estimate in advance, he could have multiplied the deductible expenses by the percentage printed on the tax card as the additional withholding rate (lisäprosentti; tilläggsprocent), which is 42% on his tax card (42% × €3,650 = €1,533).