What expenses may not be deducted?
Ordinary living expenses or expenses for the production of tax-exempt income cannot be deducted as expenses for the production of income.
Non-deductible living expenses include, for example:
- family expenses, home rent, and expenses for the care of children and the home
- ordinary clothing expenses
- hobby expenses
- acquisition costs of ordinary household devices (e.g. phones, cameras, televisions), even if they are partly used for the production of income
- newspaper and magazine subscriptions
- medical and healthcare expenses. Check whether you are entitled to an ability-to-pay tax deduction due to large medical expenses
- exercise expenses, even in cases where the job or employer requires exceptional performance.
The main rule is that you may not deduct expenses incurred in the production and maintenance of tax-exempt income
Example: If you occasionally pick wild berries and earn tax-exempt income from this work, you cannot deduct the expenses incurred from berry picking as expenses for the production of wage income.
Please note: However, expenses for the production of dividend income are deductible, even if the dividends are tax-exempt income.