GWG 2026: Threshold of €800, mixed lots up to €1,000

What is a low-value asset?

A low-value asset (GWG for short) is a depreciable, movable fixed asset that can be used independently and whose cost does not exceed a certain limit. The threshold is €800, calculated per individual asset and excluding VAT, provided you can deduct this as input tax (Section 6(2), Sentence 1 of the Income Tax Act [EStG]). If you cannot deduct it, compare the amount to €800 gross. The full cost of the item is decisive, even if you use it partly for personal purposes. As of October 2026, the legislature has not changed the amounts of 250, 800, and 1,000 €.

The advantage: Normally, the value of an item is spread out over its useful life as depreciation (AfA, § 7(1) EStG). With the GWG, the costs are recognized immediately in the year of acquisition.

What applies to amounts up to €800 net: immediate deduction or aggregate item?

For amounts up to €800 net, you may deduct the costs in full as business expenses in the year of purchase (Section 6(2), first sentence, of the Income Tax Act (EStG)). For amounts up to €250 net, this can be done without any additional effort. For items costing more than €250, the law requires a special, continuously updated inventory listing the date of purchase and cost. This is not required if this information is already included in your accounting records (Section 6(2), sentences 4 and 5, of the German Income Tax Act (EStG)). This is not the case with a cash basis accounting method: Anyone who calculates their profit this way and immediately deducts items costing between €250 and €800 must maintain the register. If it is missing, the immediate deduction may be disallowed during an audit.

For amounts ranging from €250.01 to €1,000 net, there is an alternative: the aggregate item (Section 6(2a) of the Income Tax Act). The table shows which option is appropriate.

How does the lump-sum entry for amounts between €250.01 and €1,000 work?

This aggregate item includes all assets acquired during a given year with a net cost of more than €250 but not more than €1,000. It is written off in the year it is created and in each of the following four years, with one-fifth of the amount reducing taxable income each year (Section 6(2a), sentences 1 and 2, of the Income Tax Act (EStG)).

Two distinctive features set it apart. First, it continues to apply regardless of the individual item: If the camera breaks or is sold after a year, the entry remains unchanged (sentence 3). Second, the election applies uniformly to all goods acquired during a fiscal year (sentence 5). Anyone who chooses the aggregate item thus groups all goods within this price range under it. Goods costing up to €250 are not affected by this choice: they are immediately deductible under both methods. The choice may be different the following year.

Both options are also available to small business owners and anyone who calculates their profit using the income-surplus method.

Computers and Software: Why is the warranty period one year?

For computer hardware, operating systems, and application software, a standard useful life of one year may be applied in accordance with the BMF letters dated February 26, 2021, and February 22, 2022 (Ref. No. IV C 3 - S 2190/21/10002), a standard useful life of one year may be assumed. This rule applies for the first time to fiscal years ending after December 31, 2020; for devices in your personal assets that you use to generate income, it applies starting in 2021. For equipment purchased earlier that is still being depreciated over a longer useful life, you may retroactively apply the one-year useful life.

This is not an immediate depreciation in the legal sense, nor is it a new depreciation method or an option under accounting law: The assets continue to be depreciated in accordance with § 7(1) of the Income Tax Act (EStG), only over the course of one year. Depreciation begins upon acquisition or production, not at the start of the year; however, full depreciation in the year of acquisition is not objected to. The equipment must be included in the inventory. The one-year useful life is a suggestion, not a requirement: You may deviate from it, and other depreciation methods remain an option. The rule explicitly applies to income-related expenses as well, meaning it applies to employees and landlords.

The implication in this example: The laptop, with a net price of €1,007.56, exceeds the low-value asset threshold of €800 and the aggregate item threshold of €1,000. Under the computer rule, however, it can still be fully depreciated in the year of purchase.

What does “usable on its own” mean?

The law excludes items that cannot be used independently. For this, two criteria must be met: The item, based on its intended business purpose, can only be used in conjunction with other fixed assets, and the assets in this context of use are technically compatible with one another. This also applies if the item can be separated and integrated into a different context of use (Section 6(2), sentences 2 and 3, of the Income Tax Act [EStG]). The question, therefore, is: Does the item function on its own?

An office chair works on its own. An assembly that runs only in a specific machine and is designed specifically for that machine does not work on its own. It is not a GWG, no matter how little it costs.

At a desk, the difference is evident between two devices. A monitor can only be used in conjunction with a computer and therefore cannot be immediately deducted as a low-value asset, even if it costs only €400. A printer, on the other hand, is considered to be usable on its own because it works even without the same computer.

What Applies to Employees: Are Work Tools Considered Income-Related Expenses?

Employees may claim work-related equipment as income-related expenses (Section 9(1), sentence 3, No. 6 of the Income Tax Act (EStG)). With regard to depreciation, Section 9(1), sentence 3, no. 7 of the German Income Tax Act (EStG) refers to Section 6(2), sentences 1 through 3 of the EStG. This means that the €800 limit and the rule regarding personal use apply accordingly. The lump-sum deduction and the requirement to maintain a list for amounts over €250 do not apply to employees, as § 6(2a) EStG and the provisions regarding the list are not included in the reference. As an employee, you therefore do not have a choice between two methods: up to €800 is deducted immediately, and above that amount, the standard depreciation applies.

Employees cannot deduct input tax. Therefore, they calculate the €800 on a gross basis. If you also use a work-related item for personal purposes, you still calculate the limit based on the full cost; the business-use percentage only determines which portion is deductible. The one-year rule for computers and software also applies to income-related expenses.