Employers in France can provide employees with a tax-free allowance for business trips, both within the country and abroad. This allowance is intended to cover expenses such as meals and accommodation during the trip and is exempt from income tax. Per diem expenses in France are calculated using daily-based rates.
Specifics
To qualify for a per diem on long-distance business trips, an employee must be unable to return home daily due to the location of their work assignment. The following conditions must be met for eligibility:
The one-way distance between the employee’s residence and the work location is at least 50 kilometers.
Public transportation does not allow this distance to be traveled in under 1 hour and 30 minutes, one way.
Employees who regularly incur travel expenses are not required to provide detailed proof for every individual cost. However, specific documentation is still needed to verify the number of travel days, accommodation costs, and overall travel activity:
To confirm the total number of travel days in a year, employees must provide a list of regions visited, sufficient hotel invoices, and employer-issued certificates outlining the trip conditions.
To verify accommodation expenses, especially for longer trips - for example, hotel invoices are required.
Domestic trips
Per diem rates for domestic business trips are based on the duration of the trip, calculated by the total time the employee is away from home or their regular workplace.
For example, an employee is traveling from Lyon to Paris in France and has filled in the following trip details:
In the Payhawk template, based on the data entered by the employee, the corresponding columns will be populated in the following way:
Destination. France
Destination code. FRA-Paris
Currency. EUR
Half day. 75,6
First/Last day. 75,6
Full day. 75,6
Breakfast. Lunch. Dinner. 0. 21,1. 21,1.
In this case, the system calculates the rates in the following way:
First/Last day: 151,2 EUR total will be calculated and included in the per diem expense amount for the first and last day of the trip - July 4 and July 6, respectively.
Full day: 75,6 EUR will be calculated and included in the per diem expense amount for the whole period.
Breakfast: 0 EUR will be calculated for the per diem expense amount.
Lunch: 21,1 EUR will be calculated and included in the per diem expense amount.
Dinner: 21,1 EUR will be calculated and included in the per diem expense amount.
Trips abroad
When employees travel internationally, different rates apply. The per diem allowance depends on the specific destination country. The international travel allowance must be reduced in the following cases:
If the employee receives free accommodation, the allowance must be reduced by 65%. For example, it is provided or paid for by the employer.
If one meal is covered, the allowance must be reduced by 17.5%.
If both meals are covered, the allowance must be reduced by 35%.
For example, an employee is traveling from Paris, France to Vienna, Austria and has filled in the following trip details:
In the Payhawk template, based on the data entered by the employee, the corresponding columns will be populated in the following way:
Destination. Austria
Destination code. AUT-Vienna
Currency. EUR
Half day. 175
First/Last day. 175
Full day. 175
Breakfast. Lunch. Dinner. 0. 61,25. 61,25.
In this case, the system calculates the rates in the following way:
First/Last day: 350 EUR total will be calculated and included in the per diem expense amount for the first and last day of the trip - July 14 and July 16, respectively.
Full day: 175 EUR will be calculated and included in the per diem expense amount.
Breakfast: 0 EUR will be calculated for the per diem expense amount.
Lunch: 61,25 EUR will be calculated and included in the per diem expense amount.
Dinner: 61,25 EUR will be calculated and included in the per diem expense amount.