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German Court Rules Company-Provided 'Breakfast' Not Taxable

by Ulrika Lomas, Tax-News.com, Brussels

06 October 2017


A court in Germany has ruled that food supplied by a company to its employees in the morning does not constitute a taxable benefit because it cannot be defined as a "breakfast."

The case centered on a software company that provided free coffee and bread rolls to its workers and guests in addition to free hot drinks throughout the day. However, the tax authorities considered this a free meal for the company's employees, and therefore taxable.

The tax authorities issued the company with a demand for payment of back taxes equal to EUR1.50 (USD1.76) to EUR1.57 per employee for the period from December 2008 to December 2011.

On appeal, a court in the city of Munster rejected the tax assessment, arguing that the provision of just rolls and coffee did not constitute the provision of a full breakfast.

According to the court, for this to have been considered a taxable meal, the company would have also had to provide typical breakfast food such as spreads, cold meats, and cheeses.

The court also found that the actual cost to the company of supplying the bread rolls and hot beverages, at EUR12 per employee per month, was well below the EUR44 threshold at which the supply of food would become taxable.

TAGS: court | tax | employees | food | Germany

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