Enterprise journey allowances within the Netherlands

Whereas the reimbursement of journey bills is just not 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 employees’ commute prices in sure instances. 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 lately up to date its authorized mileage charges. From January 1st, 2023, the advised tax-free fastened allowance within the Netherlands elevated to €0.21 for every kilometer traveled between an worker’s residence and their place of job 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 sometimes enhance on an annual foundation. However to assist struggle the continued rise in residing prices and automobile gas costs, there are plans for this allowance to rise once more within the 2024 tax 12 months to €0.22 per kilometer. 

Whereas this may increasingly seem easy at first look, totally 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 price varies barely between several types of transport. 

Staff driving their private automobile

Staff driving their personal automobile between residence and the workplace can obtain an allowance of €0.21 per kilometer. To be tax-free, this enterprise bills allowance can’t 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 automobile  

Many organizations enable workers 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’ personal use of the automobile or van exceeds 500 kilometers in a 12 months, then the private utilization is taken into account ‘wage of sort’ and is taxable. 

Electrical Autos 

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

Taxi, boat, or airplane  

Employees 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 probably be thought of wage and taxed accordingly. 

Touring by public transport 

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

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

Public transport bills are utterly tax-free. So on high of the €0.21 allowance, employers can also determine to pay employees 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 record they will generate by way of their public transport card (OV-chipkaart) or present receipts of any month-to-month subscription prices. 

Whereas public transport receives larger tax exemption, as we’ll quickly see, the quantity that may be deducted is determined by the space and frequency of journey.

What further tax implications are there? 

Extra reimbursements 

Any bills a company 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 price. This consists of any cash acquired 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 personal transport, workers can use the next method;

• (variety of kilometers traveled a technique 2) €0.21 * 214 working journey days / 12 months = your tax-free journey allowance per 30 days.

This calculation already considers trip days, nationwide holidays, and statutory sick days. Nonetheless, within the case of longer-term sickness, additional guidelines should be taken under consideration. As well as, if employees are employed part-time, they need 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 price, the extra quantity will nonetheless be taxed as typical. 

Firm autos

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

Parking bills

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

When workers declare the parking bills for his or her private car, they’re taxable and have to be included in any payroll. Because of this, the €0.21 allowance additionally covers any parking bills for employees driving their very own automobile to the workplace.  

Public transport customers 

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

• 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 authorized 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