We love our pets: About 14 million cats and 11 million dogs live in German households. But pet owners know how expensive it can be to own a pet: First the costs for the pet and initial equipment, then ongoing expenses for food, insurance, healthcare, medications, and vet visits – it all adds up.
We have some good news for taxpayers with pets: some of these expenses can be deducted from your taxes. In this article, we’ll explain how.
Can I deduct the cost for my pet from my taxes?
Generally, the money you spend to purchase a pet is a part of your private pleasure expenses and non-deductible, but this is different if your animal is needed for professional or health reasons. You can read more about this in this article under “owning pets for professional reasons.”
Pet care / supervision at home
If you work a lot or want to go on vacation, you probably have to hire someone to help care for your pet during your absence. The expenses for pet care/grooming while you’re away can be deducted as household-related services (haushaltsnahe Dienstleistungen). These include household activities that are typically done by you (or another household member) for which you must hire a company or independent service provider.
You can claim 20% of household-related costs (and up to 4,000 euros per year) on your tax return to directly reduce your tax liability. There are a few things you should keep in mind:
- Your service provider must provide an invoice and operate a registered business
- Labor and travel expenses must be itemized in the invoice (these can be deducted from your taxes, but costs for food and other materials can not)
- The care must take place in your home – accommodation in boarding kennels wouldn’t be tax-deductible
- Although dog walking takes place outside of your home, the Federal Tax Court (Bundesfinanzhof) declared this a household-related service in 2017. Therefore, if your pet sitter walks your dog off of your property, this is still tax deductible – the most important part is that the rest of the care takes place in your home.
What about the groomer?
Just like with pet care, grooming must take place within your home if you wish to deduct it from your taxes. That means if you bring your pet to the groomer, it cannot be deducted, but if a mobile groomer comes to your home and grooms your pet there, you can claim it on your tax return.
Can I claim veterinary expenses on my tax return?
According to a 2012 Nuremberg Tax Court ruling, veterinary services cannot be deducted from your taxes. Even when the vet comes for a house-visit, it isn’t considered a household-related expense.
Is my pet liability insurance (Tierhaftpflichtversicherung) tax-deductible?
Yes, this insurance can be deducted as a special expense (Sonderausgabe). Simply enter the premiums in your tax return as part of your private insurance, they belong to your provisional expenses (Vorsorgeaufwendungen). If you haven't taken out a pet liability policy because your pet is included in your normal liability insurance policy, you can ask your insurance company to confirm the share that contributes to your pet insurance.
There is one restriction: You can only deduct your pet liability insurance if you haven’t already exceeded the maximum deductible amount for your other insurances (1,900 euros/2,800 euros for freelancers).
Can I deduct pet health insurance?
Pet health insurance is not deductible but may still be worthwhile.
Dog tax is also not deductible. It is considered a private expense and is part of your living expenses.
Owning pets for professional reasons
If you’ve bought or adopted a pet for professional reasons, different rules apply: Generally, you can claim all relevant invoices as income-related expenses (Werbungskosten) – this includes food and vet costs for police dogs, guard dogs, or professionally used therapy dogs.
You must distribute the acquisition costs for the animal throughout the time that they are used for professional duties, it is important that you specify all relevant expenses in your tax return. It is also good to note that working dogs are exempt from dog tax (Hundesteuer).
The rules for claiming assistance dogs on your taxes can vary depending on your situation:
Costs for guide dogs are generally covered by health insurance, but to claim this, a certificate from your eye specialist is required prior to purchase.
If your doctor prescribes a pet for therapeutic reasons such as mental illness, the expenses can be deducted as medical expenses, which belong to extraordinary expenses (außergewöhnliche Belastungen).
If you have a disability and need an assistance dog, costs for the dog can be claimed on your tax return via the disability allowance (Behindertenpauschbetrag).
Those who wish to acquire an assistance dog and claim them on their future taxes should obtain a medical certificate that confirms that they need the animal before purchasing.