What Is the Daily Allowance for My Company?

What is the Daily Allowance?

The Daily Allowance is a travel allowance granted to board members, shareholders, or company employees for business trips. It is paid from the corporate bank account and is tax-free.

How does the Daily Allowance work?

The Daily Allowance functions as any other work allowance for business trips. For instance, if you are a board member or employee of a design agency, and you travel to a designers' conference in San Francisco, United States, for a week, you can claim one week's worth of Daily Allowance for the trip.

To qualify for Daily Allowance, the business trip must involve travel between two different countries. Local trips within the same country are not included. All company members, including shareholders and board members, as well as employees, are eligible for Daily Allowance. However, contractors, while they can participate in business trips, are not eligible to receive this benefit.

Daily allowance is intended to cover minor expenses, so while we recommend that travelers collect some receipts to support the Daily Allowance, submitting these receipts is not mandatory. However, for larger travel expenses such as accommodation, airfare, and other significant costs, invoices (to the business) are generally required and must be uploaded in the Purchases section of Companio's dashboard.

Who is eligible for the Daily Allowance?

To be eligible for the Daily Allowance, you must be a member of the company's board, a shareholder, or an employee (using Companio Work). Contractors cannot benefit from the Daily Allowance.

Can I use the Daily Allowance as a tax-free salary for constant travel?

No, the Daily Allowance should not be regarded as a tax-free salary for digital nomads. The business trip must have a clear purpose and a specific duration.

While you can visit a customer for a month or attend a summit for a week, you cannot use it for extended stays in a location such as living in Chiang Mai for three months. There needs to be a specific reason for the trip.

What are the maximum amounts for the Daily Allowance?

According to the law, the maximum amounts for the Daily Allowance are €50 for the first 15 days of the month of travel and €32 for each following day (from January 1, 2025, daily allowance amounts will be increased to €75 for the first 15 days and €40 remaining).

How do I use the Daily Allowance?

To use the Daily Allowance, you must inform us about the trip in advance and provide appropriate documentary support, including flight tickets, accommodation details (e.g., Airbnb receipts), and justification for the trip (e.g., conference tickets, signed customer document).

After the trip, you can transfer the corresponding amount to your bank account, specifying "Daily Allowance" in the transfer concept.

Is it true that I can get a tax-free salary of €1230 every month?

No, that is not true. The amount you may be referring to is the Daily Allowance, which allows you to withdraw a tax-free amount from your business account for business trips. It is intended to cover your expenses during work-related travel.

However, you must declare the trip in advance, provide supporting documentation, and justify the purpose and duration of the trip. The Daily Allowance cannot be claimed as a tax-free salary for extended stays without a clear business purpose.

Updated on: 09/12/2024