Tax-exempt allowances in 2017 for business travel

Date of issue
11/30/2016
Validity
1/1/2017−

Decision of the Tax Administration on tax-exempt allowances for travel expenses in 2017

— English translation —

Under § 73 and § 75.2 of Income Tax Act (TVL) of 30 Dec 1992 (1535/1992), including the amendments by Act no 504/2010 and by Act no 1246/2013, the Finnish Tax Administration has set out the following:

§ 1

The criteria for and amounts of allowances for travel expenses, to be considered exempt from tax in the 2017 taxation, shall be as prescribed in this decision below.

§ 2

Travel expenses are the costs arising from a taxpayer's business travel in the territory of Finland or other countries.

§ 3

Business trips mean any short-term trips by an employee in performing his duties to a place where he temporarily performs working tasks or conducts business, distinct from his regular place of work. If, because of the nature of his work, the employee has no regular place of work, any short trip by employee from home to a temporary place of employment is a business trip.

Furthermore, trips under the following circumstances are also regarded as business trips:

  1. Location of the workplace is elsewhere than inside the facilities or establishments that belong to the employer or to a closely related corporate entity within the employer’s sphere of interest;
  2. Work falls into the definition of temporary work under § 72a, Income Tax Act (TVL)
  3. Location is at a distance exceeding 100 kilometres from the taxpayer’s home;
  4. Taxpayer has stayed overnight, due to the trip to the workplace, in temporary quarters, which are necessary because of the distant location of the workplace.

Nevertheless, travelling or commuting between home and regular place of work is not considered a 'business trip' or 'travelling in business'. This also concerns weekend travel or other similar travel between home and a temporary place of employment, during a longer work assignment spanning several work weeks.

If it is typical for the line of work that the location of employment changes frequently because of the short-term nature of work in the particular sector, daily travel from home to a temporary 2 location will only make the employee eligible to receive allowances for 'travel expenses proper' referred to in §7, §8 and §9 below, if the employee has no main or regular place of work. The employee shall, however, also be entitled to meal money (§14) if he has no opportunity to benefit from meal services arranged by his employer on the temporary location or in its immediate vicinity.

§ 4

Travel made otherwise than as referred to in section 3, paragraphs 1 and 2, by an employee to his secondary workplace, only makes the employee eligible to receive allowance for 'travel expenses proper' (see §7, §8 and §9), and to receive allowance for accommodation (see §16). Secondary workplace means such ordinary establishment of the employer, or another corporation within the same sphere of interests with the employer, which is situated in another area, or another state, than the employee’s primary, main or regular place of work.

Travelling to and from an employee’s separate accommodation and his secondary workplace does not entitle the employee to receive allowance for 'travel expenses proper' when the separate accommodation is necessary because of the location of the secondary workplace.

§ 5

The main or regular place of work is the employee’s permanent place of employment. If, owing to the itinerant nature of his work, the employee has no permanent place of employment, the main or regular place of work is considered the place where he receives his assignments and keeps the clothes, tools or materials that he uses in his work, or any other location with a similar function in respect of the performance of his duties.

§ 6

A day of travel means a period of no more than 24 hours beginning from the time that the employee sets out on a business trip from his workplace or home. A day of travel ends when the employee returns from a business trip to his workplace or home.

§ 7

Allowance for travel expenses proper to be paid for business travel means reimbursement for tickets for travel, seats or sleeping car berths and other comparable expenses directly related to travel.

Allowance for travel expenses proper also includes costs for the transport of tools and other such equipment that the employee must take with him.

§ 8

The maximum allowance for travel expenses, payable for the business travel of the employee usingtransport other than a motor vehicle owned or held by him is the amount spent on travel expenses proper, demonstrated with tickets provided by the transport company or other reliable proof.

§ 9

The maximum allowance for an employee’s business travel using a means of transport owned or held by him shall be:

Vehicle (means of transport) Maximum allowance amounts per Km
Passenger car

41 cents, raised by:

  • 7 cents for towing a trailer.
  • 11 cents, if performance of the duties-at-hand requires towing a caravan attached to the car.
  • 21 cents, if performance of duties requires towing a mobile canteen or other comparable heavy load attached to the car.
  • 3 cents for transporting machinery or other items in the car; weighing over 80 kilograms, or of large size.
  • 3 cents, if performance of duties requires the employee to transport a dog in the car
  • 9 cents for actual kilometers driven on forest roads or road construction sites closed to other traffic if performance of duties so requires.
Motorboat, up to 50 hp 73 cents
Motorboat, more than 50 hp 106 cents
Snowmobile 101 cents
All-terrain quadbike 95 cents
Motorcycle 32 cents
Moped 17 cents
Other means of transport 10 cents.

If other persons, for whose transport the employer is responsible, travel in a vehicle owned or held by the employee, the maximum allowance referred to in paragraph 1 is raised by 3 cents per Km and passenger.

If an employee, enjoying the company car benefit known as the limited benefit (käyttöetu; förmån att använda bil), referred to in the official decision of the Tax Administration on benefits-in-kind, uses the company car for business travel and pays the fuel he is entitled to a kilometer allowance of no more than 10 cents per Km.

§ 10

Per diem, i.e. daily allowance means coverage for a reasonable increase in meal expenses and other living expenses incurred by the employee during business travel. Thus, per diem does not include allowance for travel expenses proper or accommodation expenses.

§ 11

Per diem is payable only for such a day when the temporary place of employment is located more than 15 Kms away from either the employee’s main or regular workplace or his home, depending on where the travel begins. Moreover, the temporary place of employment should be more than 5 Kms away both from the main or regular workplace and from home.

§ 12

Depending on the duration of a business trip, the maximum per diem amounts are the following

Duration of trip Maximum per diem
More than 6 hours (partial amount) €19.00
More than 10 hours (full amount) €41.00
and, if travel time exceeds the last full day of travel:  
- by at least 2 hours €19.00
- by more than 6 hours €41.00

For any day of travel, when the employee receives free meals, or meals included with the travel ticket, the maximum per diem is half the amount specified in paragraph 1. Free meals comprise two free meals in the case of full per diem, and one free meal in the case of partial per diem.

§ 13

The maximum per diems payable for business travel outside Finland are as follows:

Country or region

Maximun per diem €

Afghanistan

57.00

Albania

54.00

Algeria

67.00

Andorra

57.00

Angola

95.00

Antiqua and Barbuda

74.00

Argentina

47.00

Armenia

51.00

Aruba

53.00

Australia

70.00

Austria

62.00

Azerbaidzhan

53.00

Azores

59.00

Bahamas

74.00

Bahrain

73.00

Bangladesh

57.00

Barbados

64.00

Belarus

42.00

Belgium

62.00

Belize

47.00

Benin

42.00

Bermuda

75.00

Bhutan

41.00

Bolivia

39.00

Bosnia and Hercegovina

48.00

Botswana

41.00

Brazil

65.00

Brunei

41.00

Bulgaria

51.00

Burkina Faso

39.00

Burundi

46.00

Cambodia

54.00

Cameroon

49.00

Canada

66.00

Canary Islands

60.00

Cape Verde

42.00

Central African Republic

66.00

Chad

52.00

Chile

55.00

China

66.00

-Hong Kong

72.00

Colombia

59.00

Comoros

41.00

Congo (Congo-Brazzaville)

51.00

Congo, Democratic Republic of
(Congo-Kinshasa)

67.00

Cook Islands

71.00

Costa Rica

54.00

Côte d’Ivoire, Ivory Coast

71.00

Croatia

61.00

Cuba

61.00

Curaçao

48.00

Cyprus

60.00

Czech Republic

56.00

Denmark

68.00

Djibouti

64.00

Dominica

54.00

Dominican Republic

60.00

East Timor

48.00

Ecuador

58.00

Egypt

53.00

El Salvador

49.00

Eritrea

57.00

Estonia

51.00

Ethiopia

47.00

Faroe Islands

53.00

Fiji

50.00

France

66.00

Gabon

73.00

Gambia

39.00

Georgia

46.00

Germany

61.00

Ghana

49.00

Greece

58.00

Greenland

55.00

Grenada

64.00

Guadeloupe

50.00

Guatemala

58.00

Guinea

53.00

Guinea-Bissau

36.00

Guyana

42.00

Haiti

48.00

Honduras

44.00

Hungary

55.00

Iceland

72.00

India

49.00

Indonesia

51.00

Iran

53.00

Iraq

63.00

Ireland

66.00

Israel

77.00

Italy

64.00

Ivory Coast, Côte d’Ivoire

71.00

Jamaica

52.00

Japan

78.00

Jordania

74.00

Kazakhstan

49.00

Kenya

64.00

Korea, Democratic People's
Republic (North Korea)

66.00

Korea,
Republic of (South Korea)

85.00

Kosovo

45.00

Kuwait

70.00

Kyrgystan

46.00

Laos

51.00

Latvia

50.00

Lebanon

69.00

Lesotho

36.00

Liberia

59.00

Libya

69.00

Liechtenstein

71.00

Lithuania

48.00

Luxembourg

64.00

Macedonia

51.00

Madagascar

39.00

Madeira

58.00

Malawi

46.00

Malaysia

51.00

Maldives

62.00

Mali

39.00

Malta

62.00

Marshall Islands

59.00

Martinique

52.00

Mauritania

41.00

Mauritius

52.00

Mexico

48.00

Micronesia

55.00

Moldova

44.00

Monaco

69.00

Mongolia

40.00

Montenegro

51.00

Morocco

68.00

Mozambique

44.00

Myanmar (formerly Burma)

59.00

Namibia

36.00

Nepal

43.00

Netherlands

65.00

New Zealand

69.00

Nicaragua

44.00

Niger

45.00

Nigeria

67.00

Norway

71.00

Oman

67.00

Pakistan

40.00

Palau

64.00

Palestinian territory

70.00

Panama

56.00

Papua New Guinea

57.00

Paraguay

36.00

Peru

57.00

Philippines

58.00

Poland

55.00

Portugal

60.00

Puerto Rico

56.00

Qatar

72.00

Romania

53.00

Russian Federation

53.00

-Moscow

66.00

-St. Petersburg

61.00

Rwanda

42.00

Saint Kitts and Nevis

63.00

Saint Lucia

73.00

Saint Vincent and the Grenadines

70.00

Samoa

53.00

San Marino

57.00

Sao Tome and Principe

64.00

Saudi Arabia

71.00

Senegal

48.00

Serbia

54.00

Seychelles

67.00

Sierra Leone

50.00

Singapore

70.00

Slovakia

56.00

Slovenia

57.00

Solomon Islands

54.00

Somalia

60.00

South Africa

48.00

South Sudan

54.00

Spain

62.00

Sri Lanka

47.00

Sudan

72.00

Suriname

42.00

Swaziland

38.00

Sweden

63.00

Switzerland

77.00

Syria

81.00

Tadzhikistan

40.00

Taiwan

64.00

Tanzania

45.00

Thailand

59.00

Togo

49.00

Tonga

44.00

Trinidad and Tobago

70.00

Tunisia

53.00

Turkey

58.00

-Istanbul

60.00

Turkmenistan

64.00

Uganda

40.00

Ukraine

47.00

United Arab Emirates

72.00

United Kingdom

65.00

-London and Edinburgh

69.00

United States

68.00

-New York, Los Angeles, Washington

74.00

Uruguay

56.00

Uzbekistan

49.00

Vanuatu

59.00

Venezuela

90.00

Viet Nam

56.00

Virgin Islands (USA)

50.00

Yemen

62.00

Zimbabwe

50.00

Zambia

59.00

Any other country, not specified above

46.00

 

The per diem allowance concerns one day of travel i.e. 24 hours from the beginning of a business trip or 24 hours from the end of the preceding day of travel.

The maximum amount of per diem is defined on the basis of the country or region where the day of foreign travel ends. If the day of travel ends on a ship or airplane, the amount should be based on the country from where the ship or airplane last departed or, if leaving Finland, where it will first arrive.

Upon returning to Finland, the employee is entitled to half of the per diem for foreign travel paid for the last completed day of travel if the length of the business trip exceeds, by more than two hours, the last full day of travel that ended in foreign territory or in a ship or airplane departing from such territory.

If the length of a business trip exceeds, by more than ten hours, the last full day of travel, which ended in foreign territory or in a ship or airplane departing from such a territory, the employee is entitled to a per diem for foreign travel for the last full day of travel. The maximum amount payable for a day of travel or part thereof beginning after the employee returns to Finland must be determined as prescribed above in § 12.

For any business trip in foreign countries lasting a minimum of 10 hours, the employee is entitled to the confirmed amount for the relevant country. If the total duration of the trip is shorter than 10 hours the amount should be paid in accordance with the provisions and amounts applicable to domestic travel.

If the employee receives free meals or meals included in the price of a ticket or a hotel room the per diem must be reduced by 50 percent. For the purposes of calculation of per diems for foreign travel, two free meals constitute ‘free meals’.

If a business trip outside Finnish territory is made, the work being done under exceptional circumstances at the request of an employer located in Finland, and if the employee returns to Finnish territory for the night, and no per diem is being paid under § 12 above, the maximum allowance for business travel, by derogation from subparagraph 1 above is €18.00.

§ 14

Meal money can only be paid if no per diem is being paid, and the work assignment prevents the employee from having a meal at his normal eating-place during his meal break. The maximum amount is confirmed as €10.25.

If the employee has to have two meals at a place other than his normal eating-place during a business trip and no per diem is being paid the maximum meal money equals €20.50.

§ 15

The maximum allowance for accommodation payable over and above the per diem is the amount shown on a receipt or other reliable written proof provided by the accommodation establishment.

§ 16

The maximum allowance for accommodation payable, over and above the allowance for travel to the secondary workplace, is the amount shown on a receipt provided by the accommodation establishment, or a reasonable amount shown on other reliable written proof.

§ 17

An allowance for night travel is payable only if at least 4 hours (during a day of travel for which the employee is entitled to a per diem) are between the hours of 09:00 PM and 07:00 AM and if the employer does not arrange any free accommodation for the employee or pay him allowance for accommodation or for a sleeping car berth. The maximum allowance for night travel is €12.00.

§ 18

Seafarers: The foregoing provisions on allowances for travel expenses are applicable to the tax-exempt allowances under the law, payable to taxpayers earning seafarer’s income.

§ 19

This decision comes into force on January 1, 2017 and is applicable to business travel or part thereof taking place in 2017. 
 

Further explanation of the list of foreign territories where per diem allowances are paid (pdf)