Entertainment Expenses in a GmbH 2026: Deducting Business Meals in Germany

If you run a GmbH in Germany, taking clients, suppliers or partners out for meals is part of doing business. These costs are deductible as business expenses — but only under specific conditions that the tax office enforces strictly.

What Are Entertainment Expenses (Bewirtungskosten)?

Entertainment expenses are costs for hosting people for a business purpose: restaurant meals with clients, customer receptions, or catered networking events. The key is a clear business occasion — private dinners, even with business contacts, do not qualify.

• Not the same as: staff events (Betriebsveranstaltungen) — separate rules apply, €110 per-person exemption
• Not the same as: travel meal allowances (Verpflegungsmehraufwand) — flat-rate daily amounts on business trips

The 70% Rule: How Much Is Deductible

Entertainment expenses are only 70% deductible as a business expense under § 4 para. 5 no. 2 EStG. The remaining 30% is non-deductible — regardless of how clear the business purpose is.

Example: a client lunch costs €200. Your GmbH can deduct €140 (70%). The remaining €60 (30%) is not deductible — neither for corporate income tax nor trade tax.

For a full list of what your GmbH can deduct, see GmbH business expenses in Germany 2026.

Input VAT Deduction on Business Meals

For VAT purposes, you can claim the full input VAT from the invoice — not just 70% of it (§ 15 UStG). This makes the VAT treatment more favorable than the income tax treatment. You need a proper invoice with VAT shown separately.

More in our guide to input VAT deduction in Germany.

Documentation Requirements: What Must Be on the Receipt

The tax office only accepts entertainment expenses with a complete Bewirtungsbeleg (entertainment record). Required fields:

• Location and date of the meal
• Specific business occasion — e.g. "Discussion of proposal for Project XY with Mustermann GmbH", not just "client meeting"
• Names and roles of all attendees (including the host)
• Total amount broken down (food, drinks, tip)
• Host's signature

A till receipt alone is not enough. You need a restaurant invoice showing VAT plus the completed entertainment record. Restaurants are legally required to issue a proper invoice on request.

Common Mistakes and How to Avoid Them

• Vague occasion: "Client meeting" won't satisfy the tax office — be specific about what was discussed.
• Only a till receipt: Insist on a proper invoice — restaurants cannot refuse.
• Tips without documentation: Deductible but need a receipt or handwritten voucher.
• Home office meals: Tax offices scrutinize these — use a restaurant and document thoroughly.

Track Entertainment Receipts Digitally with Norman

With Norman's AI bookkeeping, you photograph receipts on your phone and the AI reads out amounts, dates and locations automatically — categorizing expenses correctly and archiving them in a GoBD-compliant way. See also digital receipt management in Germany.

Conclusion

Business meal deductions are a frequent topic in GmbH tax audits. Know the 70% rule, keep complete records, and document every business occasion specifically. For more on GmbH tax filing in Germany, visit our product page.