The Daily Allowance is a travel allowance granted to the members of the board of a company. They can be paid to them from the corporate bank account for free. they are not subject to taxes. They work as any other work allowance for a business trips. For example, if you, as the board member of a design agency, travel to a designers’ conference in San Francisco, United States, for one week, you can claim one week of Daily Allowance for the trip.
To enjoy the Daily Allowance, you need to pay yourself a board member salary first. The Daily Allowance is subject to paying board member taxes for your salary.
Some people ask if they can pay themselves a “salary” made of Daily Allowance if they travel constantly as digital nomads. That’s not the case. You should not see the daily allowance as a tax-free salary. The business trip must have a very clear purpose, and a specific duration. You can visit a customer for a month or go to a summit for one week, but you cannot use it to travel to Chiang Mai and live there for three months. It needs a specific reason.
The law specifies that the maximum you can pay yourself is 50 euros for the first 15 days of the month of travel, and € 32 for the rest of the month:
The tax exempt limit of daily allowances during assignments abroad is 50 euros for the first 15 days of the assignment abroad (15 days per calendar month at most) and 32 euros for each of the following days (Income Tax Act § 13 (3) ( one)).
How do I use the Daily Allowance?
In order to make use of the Daily Allowance, the first thing is to inform us of the trip beforehand. We need the appropriate documentary support for the trip, including if possible flight tickets, accommodation (AirBnB for example), and the justification of the trip (the tickets of the conference, a signed document from the customer certifying your visit, etc).
Then, after the trip, you can transfer that amount of money to your personal bank account. Specify “Daily Allowance” in the transfer concept, and make sure the amount of money is correct. Another option is getting the money from an ATM using your corporate debit card. In that case, you need to let us know so we can match the payment to the Daily Allowance.