Business travel allowances in the Netherlands

Whereas the reimbursement of journey bills just isn’t legally required within the Netherlands, most Dutch organizations will make the most of tax-free mileage allowances to reimburse their workers’ journey prices. 

Companies would possibly even absolutely refund their staff’ commute prices in sure circumstances. No matter is agreed upon, the allowances and necessities for refunding journey prices will all the time be outlined in firm insurance policies, employment contracts, or any collective labour agreements. 

What are the mileage allowance charges within the Netherlands for 2023?

The Dutch Tax Authority has not too long ago up to date its permitted mileage charges. From January 1st, 2023, the instructed tax-free fastened allowance within the Netherlands elevated to €0.21 for every kilometer traveled between an worker’s residence and their workplace and vice versa.

This 12 months is the primary time the Dutch authorities has elevated tax exemptions on enterprise miles since 2016. These figures don’t usually enhance on an annual foundation. However to assist struggle the continuing rise in residing prices and automotive gasoline costs, there are plans for this allowance to rise once more within the 2024 tax 12 months to €0.22 per kilometer. 

Whereas this will seem easy at first look, completely different disclaimers apply relying in your worker’s technique of transportation. These guidelines will have an effect on the quantity they obtain and have implications for tax returns. 

How does mileage allowance work?

As we alluded to above, the enterprise mileage fee varies barely between various kinds of transport. 

Staff driving their private automotive

Employees driving their non-public automotive between residence and the workplace can obtain an allowance of €0.21 per kilometer. To be tax-free, this enterprise bills allowance can not exceed the speed set by the Tax Authority (€0.21) and can’t be claimed for greater than 214 working days per calendar 12 months. 

Staff driving an organization van or automotive  

Many organizations permit employees to make use of an organization car for enterprise and personal functions. Whether or not touring on household journeys or to and from the grocery retailer, if workers’ non-public use of the automotive or van exceeds 500 kilometers in a 12 months, then the non-public utilization is taken into account ‘wage of sort’ and is taxable. 

Electrical Autos 

Whereas reimbursing workers’ electrical energy prices for recharging autos just isn’t permitted, staff driving electrical vehicles are entitled to a mileage allowance. The workplace could have the services to cost electrical autos eradicating the fee to the worker, however as this can’t be assured, the automotive allowance is in place to cowl the prices of charging at residence. 

Taxi, boat, or airplane  

Workers touring by taxis, boats, or airplanes may obtain mileage allowance aid. Nonetheless, it must be famous that any bills paid over the €0.21 allowance will likely be thought of wage and taxed accordingly. 

Touring by public transport 

Employees who come to the workplace by bus, ferry, or metro are additionally entitled to tax-free mileage allowances, however to be eligible, they have to meet the next standards. 

• Staff should journey greater than 10 kilometers every solution to attain their workplace from residence. 
• Workers should commute to the identical office not less than 1 day per week and for not less than 40 days every year. Every journey should be accomplished inside 24 hours to depend in direction of their whole. 

Public transport bills are fully tax-free. So on high of the €0.21 allowance, employers might also determine to pay staff full journey bills once they commute to work by these means.   

Staff should present proof of their public transport prices to have these bills reimbursed. They might want to submit copies of their tickets or the digital journey checklist they’ll generate by means of their public transport card (OV-chipkaart) or present receipts of any month-to-month subscription prices. 

Whereas public transport receives higher tax exemption, as we are going to quickly see, the quantity that may be deducted depends upon the gap and frequency of journey.

What further tax implications are there? 

Extra reimbursements 

Any bills a corporation pays workers above the €0.21 enterprise journey and commuting allowance are deemed a part of an worker’s wage and topic to their revenue tax fee. This consists of any cash obtained for tolls, depreciation for put on and tear, or private car injury.  

Staff driving their very own autos 

To calculate the tax-free reimbursement for his or her enterprise journeys and commuting bills with non-public transport, workers can use the next system;

• (variety of kilometers traveled a technique 2) €0.21 * 214 working journey days / 12 months = your tax-free journey allowance per thirty days.

This calculation already considers trip days, nationwide holidays, and statutory sick days. Nonetheless, within the case of longer-term sickness, additional guidelines must be taken under consideration. As well as, if staff are employed part-time, they have to pro-rata this equation accordingly. 

Journey allowances may be paid for as much as six weeks of absence, however all reimbursement should stop afterward. As talked about above, if the group reimburses enterprise journeys over the advisory €0.21 fee, the extra quantity will nonetheless be taxed as traditional. 

Firm autos

Whereas companies can get tax aid on bills like MOTs and the VAT on firm autos, they have to account for any non-public use of firm vehicles. Automobile mileage racked up for enterprise functions can nonetheless profit from the tax-free allowance however should be recorded and evidenced precisely. 

Parking bills

The prices of parking an organization automotive may be labeled middleman and might subsequently be reimbursed tax-free. Nonetheless, this isn’t the case for workers utilizing their very own autos to drive to work. 

When employees declare the parking bills for his or her private car, they’re taxable and should be included in any payroll. For that reason, the €0.21 allowance additionally covers any parking bills for staff driving their very own automotive to the workplace.  

Public transport customers 

The tax deductions for enterprise use mileage for workers who use public transport rely upon two elements. 

• The gap traveled between the worker’s residence and their work location. 
• The variety of days the worker travels into the workplace. 

The desk under can be utilized to assist decide the permitted mileage allowance fee on this occasion:   

* Over 90 kilometers, the journey allowance will increase to €0.26 per kilometer as much as a most of €2,354 whatever the variety of days traveled.

Supply: belastingdienst.nl