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MIL OSI Translation. Region: Germany / Deutschland –

Source: Federal Ministry of Finance

In order to strengthen the voluntary commitment of citizens, the Bundestag has initiated a series of tax improvements. These include increasing the excercise supervisor’s allowance and the voluntary fee, reducing unnecessary bureaucracy for non-profit organizations and expanding non-profit purposes.

On December 16, 2020, the German Bundestag passed the Annual Tax Act 2020, which included a number of tax improvements for citizens engaged in voluntary work: Higher lump sums On January 1, 2021, the instructor’s allowance will increase from 2,400 euros to 3,000 euros per year and the honorary work allowance from 720 to 840 euros annually. Up to this amount, the lump-sum reimbursement for financial expenses of volunteers remains tax-free. For example, trainers who work part-time in a sports club benefit from the exercise instructor allowance. The compensation for trainers, e.g. B. at the volunteer fire brigade or the DLRG are benefited from this. Those who do not fall under the exemption allowance but are nonetheless involved in voluntary work benefit from the higher volunteer fee. This applies, for example, to secretaries of non-profit associations. Reduction of unnecessary bureaucracy Smaller non-profit associations and other tax-privileged organizations are given more time to use their funds: For corporations with annual income of less than 45,000 euros, the strict standards of timely use of funds no longer apply. You can use the funds received for your statutory purposes beyond the two-year limit that continues to apply to larger organizations. This gives them more leeway and relieves them. In the future, non-profit corporations will also be able to work together on a division of labor basis and thus work together better and more efficiently for their tax-privileged purposes. So far, such collaborations have failed due to the principle of so-called immediacy, according to which the organization has to realize its purposes itself. In the future, for example, a tax-privileged corporation operating a hospital can outsource a special-purpose laundry to a subsidiary without risking non-profit status. In practice, however, this was prone to disputes. The now unified regulation on the transfer of funds now ensures that legal certainty is created with a single central regulation: The exemption limit for economic business operations is increased from 35,000 euros to 45,000 euros annually. This relieves smaller associations in particular of tax obligations, as the business operations are not subject to corporation and trade tax with income up to this amount. Charitable purposes expanded With the Annual Tax Act 2020, the number of charitable purposes is increased in the tax code. This means that associations and other corporations are now also charitable in the tax sense if, among other things, they Pursue the following purposes: Promotion of climate protection Promotion of public radio promotion of aid for people who are discriminated on the basis of their gender identity or gender orientation Promotion of the maintenance and care of cemeteries Promotion of local beautification In addition, the catalog of so-called special-purpose enterprises that are tax-privileged is being expanded. In the future, this will also include: Facilities for refugee aid Facilities for the care of people with mental and emotional illnesses or disabilities Digitization started – transparency created The central grant recipient register at the Federal Central Tax Office finally creates transparency in the public benefit. This makes information publicly available about who is working where and for what purposes. This enables both citizens and companies to obtain targeted, structured and reliable information before they donate. At the same time, the central register is a core element for digitizing the donation receipt.


EDITOR’S NOTE: This article is a translation. Apologies should the grammar and / or sentence structure not be perfect.

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