The Federal Council approved the Tax Amendment Act on 19.12.2025, meaning that, among other things, the increase in the commuting allowance will apply from 1.1.2026. Measures of a purely technical nature will also be implemented. The following explanations provide an overview of the most important changes to income tax.
Changes to income tax:
1. commuting allowance, § 9 EStG
The commuting allowance will be increased to € 0.38 for all taxpayers from 1.1.2026 from the first kilometer of travel. This also applies to taxpayers who live in a double household for professional reasons.
2. lump sum for trainers and volunteers, § 3 No. 26, 26a EStG
The lump-sum allowance for trainers will be raised from €3,000 to €3,300 from 2026 and the lump-sum allowance for volunteers from €840 to €960.
It is also clarified that the requirement to promote charitable, benevolent or ecclesiastical purposes (Sections 52 to 54 AO) applies both to legal entities under public law and to corporations that fall under Section 5 (1) No. 9 KStG (applies in all open cases after the promulgation).
3. tax exemption of bonuses for Olympic and Paralympic Games, § 3 No. 73 EStG
Premium payments from the German Sports Aid Foundation, which are granted for placements at Olympic or Paralympic Games, will be exempt from income tax from 2026.
4. double housekeeping abroad, § 9 para. 1 sentence 3 no. 5 sentence 4 EStG
The actual expenses for the use of the accommodation are to be recognized as accommodation costs for double housekeeping. From 2026, a maximum amount of € 2,000 per month (= twice the amount in Germany) applies for the use of a home abroad. The maximum amount for the home abroad does not apply if an official or company home must be used for a specific purpose or if its costs have been recognized as necessary for the purposes of the rent allowance in accordance with Section 54 of the Federal Salaries Act.
5. trade union dues as income-related expenses (§ 9a sentence 3 EStG)
Contributions to trade unions are contributions to professional bodies and other professional associations whose purpose is not directed towards a commercial business. From 2026, these can be taken into account as income-related expenses in addition to the employee lump sum, if and to the extent that the actual expenses do not exceed the lump sum for income-related expenses of € 1,230.
6. party donations, §§ 10b para. 2 sentence 1, 34g sentence 2 EStG
The maximum amount for the deduction of donations/contributions to political parties will be increased from € 1,650 to € 3,300 (€ 6,600 for joint assessment) from 2026. Insofar as a deduction for special expenses is possible, the current maximum amount of € 825 will be increased to € 1,650 (to € 3,300 in the case of joint assessment).
7. loss deduction for the tariff reduction for income from agriculture and forestry, Section 32c (5) sentence 1 no. 1 EStG
§ Section 32c (5) EStG contains circumstances that exclude the rate reduction. One reason for exclusion is the carry-back of losses from an assessment period of the second assessment period to an assessment period of the first assessment period. The previous version does not take into account the situation in which a loss from the first tax year of the second assessment period is carried back to the penultimate tax year of the first assessment period. This will now be adjusted. (Applies from FY 2026)
8. clarification on the flat-rate option for company events, Section 40 (2) sentence 1 no. 2 EStG
Contrary to its previous case law, the BFH has ruled that a company event within the meaning of Section 40 para. 2 sentence 1 no. 2 EStG also exists if it is not open to all members of a company or part of a company. The BFH justifies this by stating that the definition of „company event“ in Section 40 para. 2 sentence 1 no. 2 EStG corresponds to the legal definition in Section 19 para. 1 sentence 1 no. 1a sentence 1 EStG. Terms that are used in different provisions of the same law should generally be interpreted uniformly.
The law therefore now expressly clarifies that the flat-rate option for wages paid on the occasion of company events only exists if participation in the company event is open to all members of the company or part of the company. (Applies from VZ 2026)
9. time limit on the mobility bonus lifted (Section 101 sentence 1 EStG)
The time limit on the mobility premium, which applies to taxpayers with lower incomes, will continue to apply after 2026.