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Travel allowances and mileage: 5 rules for paying the managing partner’s business trips
Step Inside Accounting · Practical guide
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1. What they are for
Daily travel allowances (ajudas de custo) cover the extra costs of a business trip, such as meals and accommodation away from the usual workplace. Mileage covers the use of the manager’s own car for company business.
They are not a salary top-up. They pay for the costs of real trips, and that is how the Tax Authority looks at them.
2. Only trips on company business
Meetings with clients and suppliers, trade fairs, training or client visits all count. They have to be away from the usual workplace: more than 20 km for day trips and more than 50 km when there is an overnight stay.
The commute between home and the office does not count, however long it is.
3. The limits for paying no IRS or Social Security
In 2026, for managers, the limits are:
- €72.65 per day in Portugal.
- €167.07 per day abroad.
- €0.40 per km in your own car.
On a day trip with no overnight stay, only part of the daily amount counts: 25% if the trip covers lunchtime and another 25% if it covers dinnertime. With an overnight stay, the full daily amount applies.
Within these limits there is no IRS or Social Security. Anything above them is treated as salary: it pays IRS and Social Security (23.75% paid by the company and 11% by the manager).
Example
A client meeting in Coimbra: leaving Lisbon at 9am, back at 7pm, 400 km round trip in the manager’s car. The company can pay €160 in mileage (400 × €0.40) and €18.16 in allowance for lunch (25% of €72.65), with no IRS or Social Security.
Example
A trip to Madrid with an overnight stay, where the company pays the manager €200 a day. Up to €167.07 there is no tax; the €32.93 a day above the limit is salary and pays IRS and Social Security.
4. No travel log, no proof
Each payment needs a travel log (mapa de deslocações), filled in and signed by the manager. It should include:
- Name, date and place of the trip.
- Purpose (for example, the meeting and who it was with).
- Departure and return times.
- For your own car: registration, owner and kilometres driven.
Without a travel log, the company cannot deduct the cost and the Tax Authority may treat the amount as salary. Even with one, anything not invoiced to clients pays 5% autonomous taxation in IRC. If the trip is invoiced to the client, this tax does not apply.
5. The mistakes the Tax Authority picks up
- The same amount every month, which looks like a disguised salary.
- Mileage between home and the office.
- Mileage paid for the company car: it is only paid for your own car.
- A lunch allowance and, on the same day, the restaurant bill or the meal allowance.
- Trips at weekends or on holiday with no business reason.
- Travel logs all filled in at once at the end of the year.
Team tip
Fill in the travel log on the day of the trip (a note on your phone is enough so you don’t forget) and send it to your accountant with that month’s payroll. Keep the receipts for tolls and parking: they are reimbursed separately and do not count towards these limits.
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This article is for information only and does not replace professional advice. Figures and rules are those in force at the date of publication and may change.
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