When it comes to paying a travel allowance, it does not matter if your employees travel on foot, by bicycle, private car, or public transport. The distance does not matter either. Nor whether it is a commute or business trip, such as a visit to a customer.
Tax-free travel allowance 2023
In 2023, you may reimburse your employees €0.21 per kilometre tax-free. This amount is not regarded as salary by the Tax and Customs Administration. So, you do not withhold payroll taxes over it. You can also reimburse a higher amount per kilometre. But anything above €0.21 is regarded by the Tax and Customs Administration as salary and cannot be paid out tax-free.
In 2024, the tax-free travel allowance will increase to €0.22 per kilometre.
Reclaim travel expenses up to 5 years later
Employees may reclaim their travel expenses up to 5 years after the travel date (Civil Code 3, article 307, in Dutch). They must then be able to prove their travel expenses and/or kilometres travelled.
Own or public transport
If your employee travels by private transport, you may reimburse a maximum of €0.21 per kilometre tax-free. This is also possible if an employee has to detour. For example, to take children to school. In that case, you may not reimburse the kilometres for the detour tax-free, because these are private travel expenses.
Does your employee travel by public transport? Then you can also reimburse €0.21 per kilometre travelled. Or you can reimburse the actual travel costs tax-free. For example, the cost of the (return) train ticket. This is usually done via a declaration form. Your employee will then hand in the train ticket or a printout of the public transport (OV) chip card listing the costs.
Does your employee travel in a different way than by public or private transport? For example, by boat, airplane, or taxi? Then you reimburse the costs incurred. A receipt proving the costs is required for this. Such as a plane ticket or receipt for the taxi ride.
Carpooling and travel allowance
Do your employees come to work together by car (carpooling)? Then there are 2 options for the travel allowance:
- You organise the carpool
You make an appointment with one employee to drive and pick up other colleagues. You reimburse this employee €0.21 per kilometre, including the kilometres that they have to detour to pick up the others. The passengers do not receive any compensation, because you make this transport possible for them.
- Your employees organise the carpool themselves
They will then all receive €0.21 per kilometre. You do not have to reimburse the kilometres for making a detour to pick up others. These are seen as private travel expenses.
Travel allowance when working from home
Employees who partly work from home can also receive a travel allowance.
You can choose from 2 options:
- You calculate the actual travel costs based on the kilometres travelled on days that your employee travelled for work.
- You agree to a fixed fee with your employee. The law provides for the 128/214-day scheme (in Dutch) for this. This scheme means that an employee who travels to a fixed workplace for at least 128 days in a calendar year may receive an allowance as if they travelled on 214 days. For example, does your employee travel to a fixed workplace for 130 days? Then you may give an additional travel allowance for commuting for 84 days (214 -130 = 84).
Note: A 'fixed workplace' is an address that the employee visits at least 40 times per calendar year.
Does your employee not work full-time?
Then you adjust the 128/214-day scheme to the number of days the employee works (pro rata).
Example 1: For an employee who works 3 days, this involves 77 travel days (3/5 of 128 days) and you reimburse 128.4 days (3/5 of 214 days).
Example 2: For an employee who works 4 days, this involves 102 travel days (4/5 of 128 days) and you reimburse 171.2 days (4/5 of 214 days).
No home office and travel allowance on the same day
Do you also give your employees a working from home allowance? In that case, you are not allowed to give a working from home allowance and a travel allowance for the same work day. Even if an employee works partly from home and partly at the workplace on one day, you can only pay one compensation. So, make clear agreements about this with your employees.
Does your employee work part of the day at home and another part of the day at a customer? Then you can reimburse the business travel expenses with a declaration form.
Travel allowance in case of illness
If an employee reports sick and is expected to be absent for less than 6 weeks, you may continue to pay the travel allowance.
In case of long-term absence, you may only continue to pay the travel costs for the first 2 months. After that, this is allowed again in the first month after return.
Reimbursing more using the work-related costs scheme
The reimbursement of €0.21 per kilometre is the limit for the Tax and Customs Administration. If you reimburse more, your employee pays tax on that extra amount. If you use the discretionary scope (vrije ruimte) of your work-related costs scheme for this higher reimbursement, this amount will also remain untaxed.
Read more about calculating the discretionary scope in chapter 10 of the Payroll Taxes Handbook (pdf, in Dutch).