Germany Mileage

As an employer, you can pay an employee for using a personal vehicle for business trips. Business trips are trips to carry out business outside the place of work. You can pay your employee an approved amount of tax-exempt mileage allowance. This is regulated in Section 9, paragraph 4 a of the German Income Tax Act (EStG) and Section 5 of the Federal Travel Expenses Act (BRKG).

The approved amount of tax-exempt mileage allowance for business journeys:

You are allowed to pay an employee a higher amount but everything above the approved mileage allowance will be considered taxable income.

People who work in Germany can claim their work-related commutes as income-related expenses on their tax return. This is regulated in Section 9, paragraph 4 of the German Income Tax Act (EStG).

In 2026, the commuter allowance increased to 0,38 euro per kilometre and will apply from the first kilometre travelled. The allowance previously only applied after the 20th kilometre travelled.

Additional notes on the approved mileage rates for commute:

• The commuter allowance is only applicable for days the employee commuted to the place of work;
• The maximum is 4500 euros per calendar year, provided that no own or rented car is used.