The tax-free travel allowance will increase from € 1 to € 2023 per kilometer from 0,19 January 0,21. And from 1 January 2024 to € 0,22. As a self-employed person, you may deduct this amount per kilometer from your profit if you are also an entrepreneur for income tax purposes.
As an employer, you can also choose to increase the travel allowance as an employment condition further than the untaxed part. That increase is then seen as salary. You can designate the increase as a final levy wage via the work-related costs scheme, so that the extra increase remains untaxed.
A travel allowance is an allowance given to someone for the costs he or she incurs for travel in the context of his or her work. This may apply, for example, to commuting, but also to travel expenses to another location of the company or to a meeting or exhibition.
Travel allowances can consist of reimbursements for the costs of public transport or the use of a private car, but can also include other costs, such as costs for overnight accommodation or transport of luggage. Travel allowances are often given in addition to an employee's salary and serve to compensate for the extra costs incurred in performing work at a different location.
Due to the higher prices for driving and public transport (public transport), employees have more travel costs. Employers can reimburse their employees tax-free travel expenses. The tax-free allowance will therefore increase. When traveling by public transport, the employer can also reimburse the full travel costs tax-free. Employers do not have to increase the travel allowance. If an employer reimburses a higher travel allowance, the part above € 0,21 (€ 1 from 2024 January 0,22) per kilometer counts as wage. The employer must withhold wage taxes on this.