Tradespeople in the house? 20 % of labor costs off your taxes

Tradesperson invoices hurt, but part comes back through taxes. For work in your household you can deduct 20 % of the labor costs directly from your tax liability. The correct invoice and payment matter.

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Your chances of getting your money back

For tradesperson services in your own household (renovation, repair, maintenance, modernization) you can deduct 20 % of the labor, travel and machine costs from your taxes, up to 1,200 euros a year (§ 35a EStG). This is a direct deduction from the tax liability, not just from the assessment base.

Only the labor costs are deductible, not the material. You also need an invoice and must pay non-cash (bank transfer); the tax office does not recognize cash payment.

What you should do now

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1. Have labor costs itemized
Make sure the invoice itemizes labor and material costs separately.
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2. Pay non-cash
Transfer the amount; cash payments are not recognized for tax purposes.
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3. State it in the tax return
Enter the labor costs in the tax return (household-related tradesperson services).
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4. Keep the receipts
Keep the invoice and proof of payment; the tax office can request them.

Frequently asked questions

What can I deduct for tradesperson services?

20 % of the labor, travel and machine costs of tradesperson services in your household, at most 1,200 euros per year (§ 35a EStG). This amount is deducted directly from your tax liability. Material costs do not count. The prerequisites are a proper invoice and a non-cash payment.

Why must I transfer the tradesperson invoice by bank?

Because the tax office only recognizes non-cash payments. A cash payment, even against a receipt, means the tax benefit is lost. So always transfer by bank and keep the invoice and account proof so you can document the expenses.

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General information for self-help, not legal advice (RDG). In case of a high loss or uncertainty: contact a consumer advice center or a lawyer.