REIMBURSEMENT OF TRAVEL EXPENSES UPDATE

In practice though, only self-employed individuals tend to claim this allowance via their German tax return as accommodation is usually fully paid by the employer for travelling employees.Ĭonditions for eligibility of per diem allowances When employees are traveling on business within Germany the costs of subsistence (drinks and meals) is typically reimbursed according to the applicable per diem rates which currently are:įor the first and last day of travel, the applicable per diem rate is always 14 EUR.įurthermore, there is also an overnight allowance of 20 EUR for accommodation. These types of expenses should be in fact be claimed as part of a separate expenses claim request (a template is provided towards the bottom of this article) for actual travel expenses incurred. Breakfast, lunch and/or dinner whilst meeting clients.Transport to and from the airport and/or meetings.Now that we have a per diem definition and a law clarifying what per diem allowances are meant to cover in Germany, let us briefly look at what type of travel expenses, per diems are not meant to cover:

REIMBURSEMENT OF TRAVEL EXPENSES UPDATE

– update per diem rates each year in line the rising cost of living (the German Finance Ministry takes care of it) What is not covered by Germany per diem rates On the other hand, there is less of an administrative burden for both companies and their employees when sticking with per diem rates as there is no need to: Tax repercussions are likely (although as we will discuss in this article, not for all expenses categories) if employers choose to reimburse employees for actual expenses above the permitted per diem’s allowance instead. Moreover, an employment contract (or any other company issued policy) or collective bargaining agreement may also stipulate that per diems are to be used to reimburse employees. More specifically, the law in Germany talks about a lump sum for meals being paid to an individual as compensation for the expenses incurred in working outside their home and main workplace. FAQ on Germany per diem rates and travel expenses reimbursements What are per diem rates?Īccording to per diems (in German “ Tagespauschalen”), from the Latin for “ by the day”, refers to daily allowances paid to employees to cover costs incurred while on a business trip.

Reimbursement of travel expenses