The flat-rate energy price allowance was intended to provide relief for millions of employees due to high energy prices. But now things are getting uncomfortable, the tax office is allowed to demand the 300 euros back under certain circumstances.
It feels like a lifetime ago, but the so-called energy price flat rate (EPP) of 300 euros should provide relief for millions of employees in 2022 in view of the sharp rise in energy prices. But things can now get uncomfortable for some recipients: the tax office is allowed to reclaim the flat rate under certain circumstances. A current one Judgment of the Münster Finance Court brings clarity.
The EPP was automatically paid out through the employer for most recipients in September 2022. However, only people who were subject to unlimited income tax, i.e. who had their place of residence or habitual abode in Germany, were eligible.
In practice, employers do not examine this requirement in detail. They followed the legal requirements and paid out the flat rate if there was an active employment relationship and a wage tax class was applicable. That led to problems.
The tax office demands 300 euros back
As part of income tax audits, tax offices later sometimes demanded the 300 euros back from employers, for example if it turned out that employees did not have a place of residence in Germany and were therefore actually not entitled to the EPP.
The Münster Finance Court has now made an important decision that relieves employers of responsibility. It was determined:
- Employers do not have to comprehensively check the eligibility requirements.
- You can rely on the formal criteria specified by the law.
- If they have paid out correctly, they do not have to pay anything back, even if the employee was not entitled.
Who now has to pay back 300 euros
The ruling is good news for employers. But the bad news hits employees instead. Anyone who has wrongly received the energy price allowance must now expect a direct repayment from the tax office. This particularly affects people who worked in Germany in 2022 but did not have a place of residence or habitual residence in Germany.
Anyone affected by this can check in advance whether there was unlimited tax liability in Germany in 2022. If a refund notice comes from the tax office, you should not take it lightly. Normally you have bad cards and have to pay back the lump sum.
The current ruling makes it clear: It is not employers, but rather employees who are liable if the requirements for the EPP were not met.
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