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Tax write-offs in your country compared to mine
Thread poster: sylvie malich

sylvie malich
Germany
Local time: 02:47
German to English
Jun 30, 2004

Alex Eames has just publicised a new newsletter and a part of it has me wondering. Is he for real or would I be wasting my tax advisor's time just asking about it?

What are your experiences with the tax authorities and these write-offs in your country. I know for example it would be close to impossible in Germany to get most of these things he states below written off. For example my tax consultant says I can't claim even the expense of a magazine or newspaper subscription in my native language. And holidays to your native country? Where is the fine line between business trip and holiday?

Cable TV? The theatre? Don't make me laugh.

Is my country more strict than yours? I am also interested in hearing from other German residents about your experience in claiming the items below. Am I being lead astray by a particularly officious Berlin tax advisor?

sylvie


What Might I Be Able to Claim For?
---------------------------------
...
(remember check with your accountant before claiming these)...

* Foreign Travel
A certain number of trips abroad, to countries where your
source or target languages are spoken, should and could be
claimed for. At very least a proportion of the trips if they
are combined business and pleasure. Even if it's a holiday,
I don't see why exposing yourself to your source or target
language, when it's not your language of habitual use,
should not be claimable. You need to refresh your skills.
You need to stay current. It's essential.

* Satellite or Cable TV
If you pay for subscription services which have channels in
your source or target languages, you should be able to claim
some or all of the cost of that. Why not? Or if you're not
comfortable justifying that, why not a proportion of it? Of
course, I don't know what you watch on TV. You must be able
to justify this to the authorities if you get audited. If
you can't, you shouldn't claim for it. If you watch French
channels 30% of the time and you translate from or into
French, why should you not claim for it?

* Books/Magazines
Books in your source or target language. Any kind of books
on any subject. I wrote a tranfree article a while back
about developing specialist subjects. Virtually all books
and magazines contain language - OK there are a few that
don't - but we're not talking about those. Anything that
could be used to develop your language skills is potentially
claimable. Even hobby or chat magazines that you might read
for entertainment.
* Cinema, theatre, culture
Anything cultural like this. Helping you to understand the
culture of your source or target language and country. A
good translation covers not only the words, but the cultural
inferences as well. So why not claim some of these things,
or part of them?
...

...For example, if you're driving somewhere 20 miles (32km) away,
and you're basically going there to look at the shops. What's to
stop you going to a stationery shop and buying something small
and work related (pencils, paper etc). Then you can claim for the
travel and parking as a business expense. It's not for the tax
authorities to tell you that you've got to run your business
efficiently and that you shouldn't drive 20 miles to buy a
pencil.

Bottom line? If you feel you can defend it, claim it. - Alex Eames


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Catherine Bolton  Identity Verified
Local time: 02:47
Member (2002)
Italian to English
+ ...
here in Italy Jun 30, 2004

Hi,
Interesting post!!
Here in Italy the authorities tend to be quite strict. For example, the only "partial" claim you can make is 50%, i.e. it's either 100% or 50%, regardless of whether you use an item 70% for business. Thus, I can only deduct 50% of the bill for my cell phone, as it is assumed I also use it for personal calls. I'd have to buy another phone strictly for business.
That said, I write off my subscription to TIME magazine and, when I still had a subscription to Scientific American, I wrote that off too. I also write off books I purchase through Amazon if I use them to research a book (this has already happened twice this year).
I also wrote off a trip to the US because I also contacted potential customers while I was there. My accountant (who is quite strict, BTW) initially had a hard time understanding that any translator needs contact with his/her native country and language in order to keep his/her skills up to date. I explained that since I am surrounded by Italian, unless I read / listen to / speak English on a regular basis there is a risk that I will lose touch with the language. I've seen it happen to expats time and again.
The travel bit might get hazy if you happen to go at Christmas time, but the 50% rule could apply if you also handle business while you're there.
So talk to your accountant. And get a second opinion if necessary.
Catherine


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Domenica Grangiotti  Identity Verified
Local time: 02:47
English to Italian
+ ...
Italy Jun 30, 2004

Hallo.

I live in Italy and - off the list you quote - the only thing I feel comfortable about is books (provided that they are invoiced under my name, no VAT but claimed as an expense).
No cable TV, no cinema/ theatre ... no holidays.
You could of course present course or foreign schools expenses and in that case also travel expenses... but not for holidays

Naturally, I include stationary expenses but not the travel expenses to get it.
My accountant would have a fit

Have a great day
Domenica


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Pee Eff
Germany
Local time: 02:47
English to German
+ ...
Cable TV Jun 30, 2004

Hi Sylvie,

Recently I had thought about this too.

It's because my cable TV provider has just digitalized our TV cable and I've subscribed to the Spanish language package which gives me 3 channels in Spanish and one in Portuguese on top of that.

Now I was wondering if I couldn't write this off. After all it's a way of keeping in touch with one of the languages I work in. It's not a big deal either, the fee for the language package ist just €3.90 per month.

I think I'll give it a try. What do others think? Any experiences with writing off TV costs?

Patrick


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Catherine Bolton  Identity Verified
Local time: 02:47
Member (2002)
Italian to English
+ ...
Back to Italy Jun 30, 2004

Domenica Grangiotti wrote:

Naturally, I include stationary expenses but not the travel expenses to get it.


Why not? I write off half of my petrol and car expenses. I wouldn't NEED to go to the stationery store if I weren't running my own business. So the cost of a ream of paper is a business expense, but so is actually getting it from the shop to your house. It's bad enough that the time it takes for us to do this is time away from the computer (no work, no income), but if you can't even write off the out-of-pocket expenses involved....
My accountant is quite the nitpicker and very strict about what can and cannot be written off, but petrol? Absolutely.
You might want to get a second opinion here! Or change accountant .
Also, how are you supposed to keep up with things like neologisms if you have no contact with the languages in which you work? Every time I go back to the States I discover that the expressions that were "in" the year before are now "out", and that new ones have entered the language. Try keeping up with THAT on a linguistic desert island.

[Edited at 2004-06-30 08:46]


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sylvie malich
Germany
Local time: 02:47
German to English
TOPIC STARTER
Neologisms Jun 30, 2004

cbolton wrote:

Every time I go back to the States I discover that the expressions that were "in" the year before are now "out", and that new ones have entered the language. Try keeping up with THAT on a linguistic desert island.


You know what I was told? "You have the Internet, don't you? That should take care of it"

grrrrrr.


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Andrzej Lejman  Identity Verified
Local time: 02:47
German to Polish
+ ...
So it's clear for me, Jun 30, 2004

why BMW is going to build its next factory in Poland...news of today. Compare our CIT of 19% with some over 40% in Germany...
With some diligence you can write-off in Poland virtually everything - car expences, cable TV, books, magazines, holidays, meals, office devices, even sauna and solarium.
The poor Germans should stop producing anything - it's simply too expensive. With all the respect to the Germans.
Best regards
Andrzej


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RobinB  Identity Verified
Germany
Local time: 02:47
German to English
Situation in Germany Jun 30, 2004

Hi Silvie,

At least the situation about tax-allowability of expenses is pretty clear here in Germany, despite the horrendous complexity of German tax law.

Books, etc.: Of course you can claim magazine purchases or subscriptions if they're relevant in any way to your professional work. All the more so for foreign language literature, of course. And if you're a non-German native speaker living in Germany, you can claim for more or less anything in your native language as long as it isn't trivial (e.g. comics). The tax authorities have accepted for some time now that translators have to keep abreast with developments in their own language. But you wouldn't want to exaggerate, otherwise you might attract a tax audit. For a freelance, it will always be a question of balancing the theoretical allowability of claims with not attracting the attention of the tax authorities.

"Cable TV? The theatre? Don't make me laugh."

No, that would be taking it a bit far. I can't imagine the tax authorities in any EU or other G7 country accepting that one, unless you were translating for the movie industry, drama, etc.

Foreign travel: the rules on the tax-deductibility of business travel (whether foreign or not) are well established in German tax law, and have been defined in some detail by court rulings.

Tax laws vary so much from country to country it's more or less impossible to provide any sort of blanket guidance on what is allowable as a business expense, and what is not. And as I said above, the last thing you want to do is expose yourself as a target for a tax audit. To be perfectly honest, I think this is an area best left to the experts.

Robin


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xxxncfialho  Identity Verified
Local time: 01:47
German to Portuguese
+ ...
Portugal Jun 30, 2004

I am not a expert in that field but I can deduce the costs of my broadband connection and I guess I could deduce the costs of cable TV.
But I am not sure about cable.
Have a nice day,
Natália


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xxxBrandis
Local time: 02:47
English to German
+ ...
Tax-Issue Jun 30, 2004

sylvie malich wrote:

Alex Eames has just publicised a new newsletter and a part of it has me wondering. Is he for real or would I be wasting my tax advisor's time just asking about it?

What are your experiences with the tax authorities and these write-offs in your country. I know for example it would be close to impossible in Germany to get most of these things he states below written off. For example my tax consultant says I can't claim even the expense of a magazine or newspaper subscription in my native language. And holidays to your native country? Where is the fine line between business trip and holiday?

Cable TV? The theatre? Don't make me laugh.

Is my country more strict than yours? I am also interested in hearing from other German residents about your experience in claiming the items below. Am I being lead astray by a particularly officious Berlin tax advisor?

sylvie


What Might I Be Able to Claim For?
---------------------------------
...
(remember check with your accountant before claiming these)...

* Foreign Travel
A certain number of trips abroad, to countries where your
source or target languages are spoken, should and could be
claimed for. At very least a proportion of the trips if they
are combined business and pleasure. Even if it's a holiday,
I don't see why exposing yourself to your source or target
language, when it's not your language of habitual use,
should not be claimable. You need to refresh your skills.
You need to stay current. It's essential.

* Satellite or Cable TV
If you pay for subscription services which have channels in
your source or target languages, you should be able to claim
some or all of the cost of that. Why not? Or if you're not
comfortable justifying that, why not a proportion of it? Of
course, I don't know what you watch on TV. You must be able
to justify this to the authorities if you get audited. If
you can't, you shouldn't claim for it. If you watch French
channels 30% of the time and you translate from or into
French, why should you not claim for it?

* Books/Magazines
Books in your source or target language. Any kind of books
on any subject. I wrote a tranfree article a while back
about developing specialist subjects. Virtually all books
and magazines contain language - OK there are a few that
don't - but we're not talking about those. Anything that
could be used to develop your language skills is potentially
claimable. Even hobby or chat magazines that you might read
for entertainment.
* Cinema, theatre, culture
Anything cultural like this. Helping you to understand the
culture of your source or target language and country. A
good translation covers not only the words, but the cultural
inferences as well. So why not claim some of these things,
or part of them?
...

...For example, if you're driving somewhere 20 miles (32km) away,
and you're basically going there to look at the shops. What's to
stop you going to a stationery shop and buying something small
and work related (pencils, paper etc). Then you can claim for the
travel and parking as a business expense. It's not for the tax
authorities to tell you that you've got to run your business
efficiently and that you shouldn't drive 20 miles to buy a
pencil.

Bottom line? If you feel you can defend it, claim it. - Alex Eames
Hi! Malich, Taking an advice of your tax-consultant shouldn´t be costing, whereas the realisation aspect should. Generally in Germany, you get 10% of all back, incl. DSL, CABLE - provable, magazines limited to time, Dictionaries have a special status, premises, Gas also against proof, etc., flight costs, or a driver, additionally 16% VAT comes into picture, as long as you pay this, you can get into investment (Betriebseinrichtung) area, which has a limited top ceiling (differs slightly from area to area and from activity to activity). I think your Tax-consultant would find a suitable answer for you.
Brandis


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Edward Potter  Identity Verified
Spain
Local time: 02:47
Member (2003)
Spanish to English
+ ...
Comments Jun 30, 2004

I believe Alex Eames mentioned in his newsletter that tax writeoff laws may be stricter in Germany and other countries.

Everything he mentioned about possible tax write offs in the U.K. sounded very familiar to me. Things are similar in the U.S.

The person who made the comment about companies relocating to Poland because you can write off so many things makes a good point. Why would anyone want to set up a business in a country that taxes the heck out of you? You better have a lot of other great reasons to have your business there.


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Vicky Shelton  Identity Verified
Local time: 02:47
Italian to English
+ ...
cable TV/satellite Jun 30, 2004

I asked my accountant about writing off a satellite system so I could watch TV in English to "keep up" with my English and he said it was fine. I haven't tried the travel write off ...wish I had thought about it for my last trip to France.
Vicky


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Sherey Gould  Identity Verified
Local time: 18:47
German to English
your OWN meals... AT HOME!! Jun 30, 2004

I was already claiming most of the things Alex talked about in his newsletter - including most of a trip I took back to Germany over last Christmas (but I DID meet with clients and scrupuously kept track/gathered receipts). But I learned something very interesting when coming back and having my taxes done here in the US a month or so later. As my tax lady was going through all my restaurant receipts, claiming for "client entertainment," she also told me that on business trips, I was entitled to a normal "stipend" on days when it was only myself I fed (we decided that would be $15 as breakfast was already included in my hotel room and I don't usually eat lunch). I then mumbled something about that being unfair when I was home - have to eat here, too, right? She actually informed me that on those days when I had too much work, no time to cook and thus went out to eat (which does happen every now and then for those exact reasons), I COULD claim that restaurant check. I NEVER heard that before. May very well submit some restaurant claims based on that with next year's taxes, but probably no more than 4 or 5. But, as others have said, I think the US may be far more accommodating of such items. (Luckily for me now, after 12+ years in Germany!)

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Williamson  Identity Verified
United Kingdom
Local time: 01:47
Flemish to English
+ ...
First think, then pick a country and then start a business Jun 30, 2004

Edward Potter wrote:

I believe Alex Eames mentioned in his newsletter that tax writeoff laws may be stricter in Germany and other countries.

Everything he mentioned about possible tax write offs in the U.K. sounded very familiar to me. Things are similar in the U.S.

The person who made the comment about companies relocating to Poland because you can write off so many things makes a good point. Why would anyone want to set up a business in a country that taxes the heck out of you? You better have a lot of other great reasons to have your business there.



Don't you have to add everything up, I mean: tax-level,tax-deductibility and social security contributions when you set up shop.
So, no business in Belgium,Holland, France, Germany,Spain, don't know about Greece, but in the New EU-Member-States, the UK and Ireland or in some areas of the EU with a favourable tax-system.
In some countries even toilet paper is tax-deductible if your customers come inside the office and need to use the toilet. The toilet itself is tax deductible too.


[Edited at 2004-06-30 15:26]


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Andrzej Lejman  Identity Verified
Local time: 02:47
German to Polish
+ ...
But be carefull! Jun 30, 2004

Williamson wrote:

In some countries even toilet paper is tax-deductible if your customers come inside the office and need to use the toilet. The toilet itself is tax deductible too.

[Edited at 2004-06-30 15:26]


There may be countries too, where you might have to keep the evidence

Andrzej


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