Aid for Ukraine: Federal Ministry of Finance extends tax relief until the end of 2027

In a let­ter dated 1 Octo­ber 2026, the Fede­ral Minis­try of Finan­ce has once again exten­ded the spe­cial tax arran­ge­ments for indi­vi­du­als and orga­ni­sa­ti­ons sup­port­ing tho­se affec­ted by the war in Ukrai­ne. The mea­su­res now app­ly until 31 Decem­ber 2027. They are aimed equal­ly at pri­va­te indi­vi­du­als, busi­nesses and cha­ri­ta­ble organisations.

Simplified donation receipt

Anyo­ne who has dona­ted money to Ukrai­ni­an war vic­tims does not need to pro­vi­de a for­mal dona­ti­on receipt. A simp­le bank state­ment, a direct debit slip or a prin­tout from online ban­king is suf­fi­ci­ent as pro­of. The con­di­ti­on is that the pay­ment was made into a spe­cial account set up spe­ci­fi­cal­ly for this pur­po­se by a reco­g­nis­ed cha­ri­ta­ble orga­ni­sa­ti­on, a public aut­ho­ri­ty or a wel­fa­re orga­ni­sa­ti­on. Pay­ments made via a third party’s escrow account may also be eli­gi­ble for reco­gni­ti­on under cer­tain conditions.

Charities can provide flexible support

Cha­ri­ta­ble orga­ni­sa­ti­ons, such as asso­cia­ti­ons or foun­da­ti­ons, may, in prin­ci­ple, only use their funds for the pur­po­se set out in their artic­les of asso­cia­ti­on. In the con­text of aid for Ukrai­ne, this rest­ric­tion is being rela­xed on an excep­tio­nal basis: Orga­ni­sa­ti­ons may use available funds, staff and pre­mi­ses direct­ly to sup­port refu­gees and vic­tims of war wit­hout this jeo­par­di­sing their cha­ri­ta­ble sta­tus. The requi­re­ment to pro­vi­de evi­dence that the peo­p­le recei­ving sup­port are in need of assis­tance, which would other­wi­se be neces­sa­ry, may be wai­ved in this context.

Corporate donations as business expenses

Com­pa­nies that incur expen­dit­u­re to sup­port tho­se affec­ted by the situa­ti­on in Ukrai­ne and, in doing so, simul­ta­neous­ly enhan­ce their public image – for exam­p­le, through rele­vant press releases or media covera­ge – may, under cer­tain con­di­ti­ons, cla­im the­se cos­ts as busi­ness expen­ses. The rele­vant gui­dance is the Fede­ral Minis­try of Finan­ce (BMF) cir­cu­lar of 18 Febru­ary 1998 on sponsorship.

Tax-free support for employees

Employ­ers can help staff affec­ted by the war by pro­vi­ding tax-free allo­wan­ces and sup­port pay­ments. The­re is also the opti­on of what is known as a ‘wage dona­ti­on’: employees can for­go part of their sala­ry or their working time account so that the employ­er can pass this amount direct­ly on to a cha­ri­ty or to col­le­agues affec­ted by the con­flict. This por­ti­on of the sala­ry that is fore­go­ne remains exempt from inco­me tax. Important: Anyo­ne making use of this sche­me must not also cla­im the amount as a spe­cial allo­wan­ce on their inco­me tax return.

Relief on VAT and gift tax

Sim­pli­fied VAT rules app­ly to cha­ri­ta­ble orga­ni­sa­ti­ons that make mate­ri­al resour­ces, pre­mi­ses or staff available free of char­ge to sup­port Ukrai­ne. This rela­tes, among­st other things, to the clas­si­fi­ca­ti­on as a spe­cial-pur­po­se ope­ra­ti­on and issues con­cer­ning input tax deduc­tion in the event of a chan­ge of use. In the area of gift tax, dona­ti­ons to cha­ri­ta­ble orga­ni­sa­ti­ons or for eccle­si­a­sti­cal and cha­ri­ta­ble pur­po­ses may be tax-exempt, pro­vi­ded that their use for the inten­ded pur­po­se is guaranteed.

What does this mean for clients?

The exten­si­on of the regu­la­ti­ons until the end of 2027 con­ti­nues to pro­vi­de indi­vi­du­als, busi­nesses and orga­ni­sa­ti­ons with plan­ning cer­tain­ty regar­ding the tax tre­at­ment of their cha­ri­ta­ble con­tri­bu­ti­ons. Anyo­ne who is unsu­re whe­ther their spe­ci­fic cha­ri­ta­ble con­tri­bu­ti­on is cover­ed by the reli­ef mea­su­res should seek tax advice. The rele­vant let­ters from the Fede­ral Minis­try of Finan­ce (BMF) are available under refe­rence num­bers IV C 4 and IV D 5, most recent­ly the let­ter dated 1 Octo­ber 2026 under refe­rence num­ber IV D 5 – S 2223/00044/032/047.