One professional group that has repeatedly found itself in court in recent years is that of influencers – be it due to unmarked product placements or even covert advertising, disputes over so-called influencer contracts, or media-effective conflicts with colleagues also working as influencers.
This time, the tax office was in dispute with a fashion blogger who wanted to claim her expenses for clothing and accessories as business expenses (income from commercial operations) in her tax return.
The plaintiff operated her blog on various social media channels and her own website, regularly creating photos and stories within this framework.
In addition to various goods that the influencer received from different companies to promote, she purchased clothing and accessories with her own money and also presented them as part of her activities on the platforms she used.
She wanted to claim the corresponding expenses as business expenses in accordance with § 4 para. 4 of the Income Tax Act (EStG).
Claiming clothing and accessories as business expenses sounds too good to be true? According to the ruling of the Fiscal Court of Lower Saxony of November 13, 2023 (3 K 11195/21), it is:
The 3rd Senate of the Fiscal Court of Lower Saxony essentially followed the argumentation of the defendant tax office.
The problem in the present case lies in the provision of § 12 No. 1 EStG. According to this regulation, amounts spent on the taxpayer’s household and living expenses that are associated with the taxpayer’s economic and social standing may not be deducted from their income. This explicitly applies even if the expenses are incurred to promote the taxpayer’s profession or activity.
Precisely such a constellation existed in the legal dispute to be decided by the Fiscal Court. According to the Senate, a separation between business and private spheres is not possible for “ordinary civilian clothing and fashion accessories“. Regardless of the actual use, the obvious possibility of private use of these garments means that tax consideration is excluded.
Typical work clothing, for which a business expense deduction is possible, is only to be assumed if it is almost exclusively intended and suitable for professional use due to its objective nature and is necessary due to the nature of the profession, or if its professional purpose is already evident from its nature, either through its distinguishing function or its protective function.
In other words: construction workers or chimney sweeps will hardly wear their work clothes in everyday life solely due to their nature and intended purpose – it is simply very typical work clothing. In such cases, a business expense deduction is certainly possible. For an influencer who presents and promotes everyday clothing, it cannot be ruled out that this clothing is also used privately by her.
Are you an influencer, content creator, or active in a similar role and have questions about tax law, criminal law, or tax criminal law? Then you have come to the right place. We specialize in these topics and offer you comprehensive advice – be it preventively or for representation in ongoing proceedings. Rely on our expertise and experience as your reliable and specialized partner. Please feel free to contact us – we are happy to assist you.