Deducting Phone Costs as a Freelancer in Germany 2026
Diana
Updated on:
A €35 mobile plan, plus a landline, plus the occasional international call — phone bills usually add up to €500–€800 a year for self-employed people in Germany. You can deduct the business share as an operating expense and, if you charge VAT, recover the input VAT every month. Here's how much you can realistically claim, why the well-known €20 lump sum doesn't apply to you, and where freelancers leave money on the table.
What counts as "phone costs"?
For tax purposes, phone costs are all running expenses for voice communication — landline and mobile. Specifically:
Base fees for mobile and landline contracts
Connection charges for domestic and international calls
SMS bundles and per-message fees
Roaming and EU/world add-ons
Calls to hotlines, premium or service numbers
Voicemail, call forwarding, call management
Prepaid top-ups with a proper invoice
Cloud telephony (Sipgate, Easybell, Placetel) and VoIP flat rates
What does not belong here: the smartphone itself (a device over €800 net is handled through phone depreciation), the desk phone as hardware, and the pure internet line (see deducting your internet). Mobile data plans on the same SIM are a grey area — if your mobile contract bundles voice and data, treat the whole plan as telecom expense and split it by business use.
Phone bills, VAT, tax return — automatic
Norman pulls your Telekom, Vodafone, or O2 invoice straight from your bank account, files it as „Phone/Mobile", and calculates VAT and business share for you. Set the share once and forget it.
How much can you deduct?
Phone costs are an ongoing expense — you book them every month, in full or pro rata. So the real question isn't "how much?" but "what share is business use?" Three setups matter in practice.
1. Pure business contract (100 %)
If you have a separate mobile or landline contract used only for work, you deduct 100 % of the cost as a Betriebsausgabe and recover 100 % of the VAT. The cleanest option is a second contract in the company name (UG/GmbH) or a business SIM whose number you only use professionally. Bonus: in a tax audit, you don't need to defend a business-use share.
2. Mixed use (private + business)
The default for solo self-employed: one phone, one landline, both for everything. You estimate the business share and deduct only that. Generally accepted shares are between 50 % and 70 %, depending on what you do:
Sales-driven self-employed (consultant, coach, broker, sales): 60–80 %
Full-time home-office freelancer (developer, designer, writer): 50–70 %
Self-employed with on-site work (tradesperson, photographer, trainer): 50–60 %
Side business alongside an employed job: 20–40 %
Document the share in writing. A two-line note in your bookkeeping is enough: "Mobile contract used 70 % for business: client calls, scheduling, suppliers, hotlines. 30 % private." If a tax audit asks, you need a plausible reason — not a per-call log.
3. Variable use (itemized proof)
If you want to maximize your input VAT recovery, you can document every call for three representative months (your provider can issue a Verbindungsnachweis), calculate the business share from that, and apply it to the rest of the year. Worth the effort only if you're a heavy phone user, full-time self-employed, and suspect your real share is above 70 %.
Heads up: the €20 lump sum is not for you
Many guides mention a "phone and internet flat rate" of 20 % of the bill, capped at €20 per month (€240 per year). That's the Werbungskosten simplification for employees under the wage tax guidelines (R 9.1 LStR). It does not apply to the self-employed. You estimate the actual business share — and for solo freelancers, that's almost always more than €20.
Anchoring to the €20 cap costs real money. On a €50 plan with 60 % business use, the deduction is €30 a month, not €20 — over a decade, that's a few thousand euros of tax relief left on the table.
Recovering input VAT
If you charge VAT (i.e. you are not registered as a Kleinunternehmer under § 19 UStG), you also recover the VAT shown on the bill. On a €35 gross monthly plan that's €5.59 of VAT — at a 60 % business share, you get €3.35 back per month.
Conditions for input VAT deduction:
You have a proper invoice with VAT shown separately (the PDF from your customer portal works)
The name and address on the invoice match your or your company's details
For invoices over €250 gross: the provider's tax number or VAT ID and your address as recipient
You claim the input VAT in the Umsatzsteuervoranmeldung (advance VAT return) for the month you received the invoice. Tools like Norman, Lexoffice, or Sevdesk calculate it automatically and submit straight to Elster.
Prepaid: VAT is tricky
Prepaid SIMs usually don't come with an invoice that shows VAT separately — only a top-up receipt. That rules out the input VAT deduction. You can still claim the business share as an operating expense, but you can't recover the VAT on top. If you charge VAT and use the phone heavily for work, a contract plan is almost always the better tax move.
Special case: mobile contract with a subsidized phone
Many plans bundle a "free" or discounted smartphone with a higher monthly fee. The tax office treats this as two transactions:
The smartphone: valued at its market price and depreciated under phone deduction rules — instant write-off if under €800 net, otherwise three to five years.
The running plan cost: the phone costs covered in this article, deducted by business share.
In practice, providers rarely separate device price from monthly fee cleanly. You can either book the whole contract as telecom expense (clean share, less depreciation upside) or do an approximate split — market value of the device ÷ contract length as a monthly depreciation slice, with the rest as phone costs. Below €1,000 a year of total spend, the split rarely pays for the extra effort.
Managing director of a UG/GmbH
If you run a GmbH or UG, two clean options:
Company phone on the GmbH: the contract is in the company's name, the GmbH deducts 100 % of the cost and the full VAT. Even private use of a company phone has been free of payroll tax and social security contributions since 2017 under § 3 Nr. 45 EStG — one of the few remaining tax-free benefits in kind.
Private contract, expense reimbursement: you document the business share (e.g. a three-month itemized bill), and the GmbH refunds the proportional amount. Tax-neutral but documentation-heavy.
Option 1 is almost always simpler and tax-friendlier — exactly because private use stays tax-free.
Worked example
You're a freelance consultant with a mobile contract bundling data and voice for €39.99 gross per month, plus a landline (voice portion €14.99 gross). Estimated business share: 65 %. You charge VAT.
Mobile annual gross: €39.99 × 12 = €479.88
Landline annual gross: €14.99 × 12 = €179.88
Total gross: €659.76
VAT inside (19 %): €659.76 ÷ 1.19 × 0.19 = €105.32
Total net: €554.44
Business share 65 %: €360.39 operating expense
Input VAT recovered (65 %): €68.46 (across 12 UStVA filings)
Income tax saved at 35 % marginal rate: €360.39 × 35 % = €126.14
Total annual relief: €194.60
So on roughly €660 of yearly phone spend, the tax office gives back almost 30 % — more if your share or marginal rate is higher.
Receipts and bookkeeping
Keep every monthly invoice from your provider — the PDF from the customer portal plus the bank statement showing the debit. Retention period: ten years under § 147 AO. For prepaid top-ups, keep the receipt with date and amount — it doesn't unlock VAT recovery, but it proves the operating expense.
On your tax return, the annual amount goes into the EÜR (Anlage EÜR), typically line 47 "Telefon- und Internetkosten". Bookkeeping software fills it in automatically once your phone bills are categorized correctly.
Common mistakes
Anchoring to €20: the lump sum is for employees. As a self-employed person you can usually claim 50–70 % — that's €24 instead of €8 on a €40 plan.
No documented share: without a brief note in your bookkeeping, the share is easy to challenge in an audit. Two lines are enough.
VAT in the annual return: input VAT belongs in the monthly or quarterly UStVA, not the annual VAT return — otherwise you sit on the cash needlessly.
Ignoring the device subsidy: for plans with a bundled phone, separate hardware and tariff. Treating both correctly can be worth a few hundred euros.
Prepaid without a receipt: no invoice with VAT shown means no input VAT — and no receipt at all means no operating expense either.
Double-counting: phone costs and phone depreciation are two separate items. If you depreciate the smartphone separately, you can't also split it inside the tariff.
Bottom line
Phone costs are one of the simplest operating expenses for the self-employed in Germany — and one of the most under-claimed. A 50–70 % business share is usually realistic for solo freelancers and accepted by the tax office, as long as you can briefly justify it. Charging VAT? You easily recover €100+ a year without buying anything new. Ignore the €20 employee anchor — it doesn't belong on your EÜR.