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In focus: travel reimbursements

On September 11, 2013 by Dutch Umbrella Company

This month, WePayPeople expat desk are having a “transport month” and will be keeping you up to date with everything you need to know about getting around The Netherlands. If you want us to write a blog for you, please contact us below.

The work cost regulations (werkkostenregeling) contain all rules relating to travel reimbursements and can be read in more detail on the belastingdienst website.

When are tax free reimbursements allowed?

  • When an employee has travelled for any business purpose in any mode of transport (e.g. in own car or by bicycle)
  • When an employee has incurred costs for travelling for business purposes (e.g. by train)

What constitutes “business purposes”?

  • Commuting between accommodation and work or vice-versa
  • Travel during the course of the day for work or between business locations
  • Work-accommodation travel during the day including travelling home for lunch

When are tax free reimbursements not allowed?

  • Any trip which is for personal use (e.g. taking your child to nursery)
  • Any portion of a trip for personal use must be deducted from the tax free calculation
  • When an employer has already paid for the transportation (e.g. by supplying a work bus)

What is the tax free allowance?

  • Employers may reimburse up to 19 eurocents per kilometre for business travel
  • Employers can however chose to reimburse entire actual cost of business travel where:
    • The business aspect can be proven
    • The travel costs are financially quantifiable
    • A record of above is retained

Employers may not reimburse using both of the above methods. Reimbursements above this level must be treated as taxable income. Additional rules concerning the employer’s “free room” calculations apply (not covered in this blog post)

What administration is involved?

  • Employees must supply their employer with evidence of business travel
  • Employers must keep a record of all business travel made and reimbursed to employees
  • This may be done by a combination of reference to reimbursements on employees’ payslips and internal record keeping

What forms of transport are covered?

  • All forms of transport are covered including bicycle travel, airline, boat, taxi, personal car use etc.

What’s in focus?

  • Employers may reimburse employees for business travel at a rate of 19 eurocents per kilometre tax free
  • Employers may alternatively reimburse entire business travel costs where applicable (air/ taxi travel etc.)
  • Employees may not be reimbursed for private travel
  • Employers must keep supporting evidence of business travel reimbursements, and such information must be kept up to date

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