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A Guide for Reimbursing Travel Expenses in the Netherlands

Certain employee positions will require business-related travel, and employers will typically pay or reimburse those expenses.  While that is a fair practice, every country has its own rules on how to reimburse, document, and calculate allowable travel expenses. 

The issue is that some expenses could have a mixed personal/business use, and may be a taxable fringe benefit to the employee.  The Netherlands uses several calculations for permitted reimbursement and imposes limits on tax-free travel expenses.

How are transportation expenses reimbursed to employees in the Netherlands?

The following rules are used for transportation expenses, either for business travel or commuting to work.

Private Transport

An employee that uses their own private transportation for business trips can be reimbursed tax-free based on distance traveled, and in Netherlands that equals EUR .19 per kilometer.  They cannot be reimbursed for personal side trips or usage.

Unlike many countries, Netherlands does allow a tax-free fixed allowance to be paid for employees commuting to work, but it is not mandatory for the employer.  The allowance is based on a formula that uses the number of round-trip kilometers between home and work, multiplied by EUR .19, and then multiplied by 214 working days in the year.  If the employer reimburses more than EUR .19 per kilometer (such as for tolls or parking fees), those are amounts are taxable as wages.

The pandemic somewhat complicated this allowance, as many employees began to work from home, but could still claim the commuting allowance in 2020.  However, that will no longer be the case in 2021, as only actual commuting days would be included.

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Company Car

The use of a company car for business or commuting is not taxable to the employee, even for some personal use up to a maximum of 500 kilometers per year.  After that, the private use will be a taxable fringe benefit.

Boat, Train, Taxi, or Bus

Public transport expenses for business travel or commuting can either be reimbursed using the EUR .19 rate, or for actual expenses with documentation.

How are airfare, hotel, and accommodation expenses reimbursed?

Airfare expenses for exclusive business trips can be reimbursed tax-free, as can accommodation costs if the employee happens to pay for them out of pocket.  In reality, these types of business expenses may either be arranged and paid for by the employer ahead of time or paid with a company credit card or travel agency.

Client Case: Is travel insurance reimbursable?

One of our clients with employees in the Netherlands wanted to know if they could reimburse travel insurance to their employee and if it was taxable.  We let them know that the reimbursement of travel insurance would be a taxable allowance to the employee.  To receive the full amount, it would have to be grossed up in payroll to account for the tax.

Do you need more information about the Netherlands?

If you are new to employing in the Netherlands, you might have other questions such as:

Are there statutory limits on the per night cost of reimbursed accommodation?

How are meals and incidentals for business travel reimbursed? 

How are employers expected to document transportation and commuting expenses? 

We assist our clients with meeting the challenges of overseas employment, by offering guidance on immigration, taxation, and employee benefits.  We make international employment simple.

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The information in this article is subject to changes in local legislation.

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