Kilometre Allowance, Per Diem and Meal Allowance in Finland 2026

What are tax-free travel allowances?

Under section 71 of the Income Tax Act (tuloverolaki), travel cost reimbursements, per diem allowances, meal allowances and accommodation reimbursements received from an employer for a business trip are not taxable income. The list is exhaustive: anything else is salary. Each year the Tax Administration (Verohallinto) sets the maximum amounts that can be paid tax-free. The 2026 decision (VH/6575/00.01.00/2025) applies to business trips, or parts of them, made in 2026.

The maximums are ceilings, not obligations. What the employer actually pays depends on the collective agreement and the employment contract. If the employer pays more than the decision allows, the excess is taxable salary for the employee.

When is a trip a business trip for tax purposes?

A business trip (työmatka) is a temporary trip made for work to a special place of work outside the employee’s regular workplace – a client site, a trade fair, a training course or a meeting. Tax-free allowances can only be paid to an employee, so there must be an employment relationship between payer and recipient (exceptions, such as a company owner, are covered below).

• Commuting between home and the regular workplace is not a business trip. Reimbursing it is salary.
• Leisure travel and private errands are not business trips. If days off are added to a work trip, no tax-free per diem can be paid for them.
• Working at the same place of work counts as temporary for at most three years. After that the site becomes the regular workplace, and trips there no longer qualify for tax-free per diems, kilometre allowances, meal allowances or accommodation reimbursements.

Kilometre allowance 2026

When an employee makes a business trip in their own car, or a car at their disposal (for example a family member’s), the tax-free kilometre allowance for 2026 is at most 55 cents per kilometre. In 2025 it was 59 cents, so the rate has gone down. The base rate can be increased by:

• 4 cents/km for each passenger whose transport is the employer’s business
• 9 cents/km when a trailer is attached to the car
• 15 cents/km when the work requires towing a caravan
• 28 cents/km when the work requires towing a site hut or a similar heavy load
• 4 cents/km for carrying machinery or items heavier than 80 kg or of large size
• 4 cents/km when the employee carries a dog because of their work
• 12 cents/km for the kilometres driven on forest roads or road construction sites closed to other traffic.

Each increase applies only once per kilometre; only the passenger increase grows with the number of people. The maximum for a motorcycle is 42 cents/km and for a bicycle or e-bike 13 cents/km. An employee with a full car benefit (vapaa autoetu) from the employer cannot be paid a tax-free kilometre allowance for driving that car. A driver with a limited car benefit (käyttöetu) who pays for the fuel can be reimbursed at most 11 cents/km.

Example: an employee drives their own car to a client and back, 300 km in total, with a colleague as a passenger. The tax-free kilometre allowance is 300 × (0.55 + 0.04) = €177.

Domestic per diem 2026

A per diem (päiväraha) covers the extra cost of meals and other living expenses caused by a business trip. It does not include travel or accommodation. The 2026 maximums are:

• partial per diem (osapäiväraha) €25 for a trip lasting more than 6 hours
• full per diem (kokopäiväraha) €54 for a trip lasting more than 10 hours
• on longer trips a per diem is paid for each 24-hour travel day (matkavuorokausi); for the final incomplete period €25 if it exceeds the last full day by at least 2 hours, and €54 if by more than 6 hours.

A distance condition must also be met: the place of work must be more than 15 km from where the trip starts (home or the regular workplace) and, in every case, more than 5 km from both the home and the regular workplace. The distance is measured along the shortest available route. Crossing a municipal border is not required.

Free meals reduce the per diem. A partial per diem is halved by just one free meal, a full per diem by two. A free meal means a meal arranged or paid for by the employer, for example in connection with a client meeting, negotiations or training, as well as a meal included in the price of a course package or a ticket. Breakfast included in the hotel room rate does not halve the per diem.

Example: a trip starts on Monday at 8:00 and ends on Thursday at 9:00. It lasts 73 hours – three full travel days – and the one extra hour does not qualify for another per diem. The employer can pay 3 × €54 = €162 tax-free.

Foreign per diem

For trips abroad the Tax Administration sets country-specific per diems. They work on the same principle as the domestic per diem, with a few special rules:

• The foreign per diem applies if the trip as a whole lasts at least 10 hours. A shorter trip is paid at the domestic rates.
• The amount depends on the country where each travel day ends. If it ends on a ship or aircraft, the country it last departed from – or, when leaving Finland, the country where it first arrives – decides.
• On returning to Finland, time beyond the last full travel day abroad earns half of the last foreign per diem if it exceeds 2 hours, and the full amount if it exceeds 10 hours.
• Two free meals in a travel day halve the foreign per diem.

The country amounts are in section 13 of the Tax Administration’s decision. For example, the 2026 per diem for Estonia is €82, for Sweden €70, and for countries not listed separately €52. Always check the rate for the destination in the decision before preparing the travel claim.

Meal allowance

If no per diem is paid for a trip – for example because the time or distance condition is not met – the employer can pay a tax-free meal allowance. The condition is that, because of the work, the employee cannot eat at their usual eating place during the meal break. For 2026 the meal allowance is at most €13.50. If the employee has to eat twice outside their usual eating place, the maximum is €27.00; in practice this requires a working day of more than 11 hours including breaks. A per diem and a meal allowance cannot both be paid for the same trip.

Night travel allowance and accommodation

The employer can reimburse accommodation tax-free against a hotel invoice or other reliable evidence. If the employee arranges their own overnight stay at no cost to the employer – with relatives or in their own caravan, for instance – a night travel allowance (yömatkaraha) of up to €16 in 2026 can be paid on top of the per diem. At least 4 hours of a travel day that qualifies for a per diem must fall between 21:00 and 7:00, and the employer must not have paid for accommodation, a cabin or a sleeper berth. Night work does not qualify for a tax-free night travel allowance.

Travel expense claim: what keeps the allowances tax-free

The allowances are tax-free only if they are paid on the basis of a travel expense claim (matkalasku) prepared by the employee. The claim can be electronic as long as it contains the required information.

What must a travel expense claim contain?

• the purpose and destination of the trip (address)
• the route, where needed
• the means of transport
• the start and end of the trip, with dates and times
• for trips abroad, the country or area where each travel day ended
• for kilometre allowances, also the kilometres driven and the rate used.

Hotel invoices, tickets and other receipts are attached. For costs with no receipt (some parking fees, for example) the employee confirms the amount by signing the claim; an electronic signature is fine. The employee must report free meals, such as a lunch offered by a client, on the claim themselves.

Employee, company owner and sole trader

Employee

The employer pays the allowances on the basis of the travel claim, either on top of salary or within a total-pay arrangement if the employment contract specifies how the total pay is made up. No tax is withheld from tax-free allowances and no employer’s health insurance contribution is due on them, but they are reported to the Incomes Register.

Owner of a limited company or partnership

A shareholder of an osakeyhtiö or a partner in a partnership (avoin yhtiö or kommandiittiyhtiö) can receive tax-free travel allowances from the company for business trips made on its behalf, even without drawing a salary. The conditions are the same as for employees, and a travel claim must be prepared for the company’s bookkeeping. The allowances are reported to the Incomes Register with the same income types as employees’.

Sole trader (toiminimi)

A sole trader cannot pay themselves a tax-free kilometre allowance or per diem, because they are not their own employee. The equivalent benefit comes as an additional deduction (lisävähennys) in their taxation:

• Car: if business drives make up 50% or less of the year’s kilometres, the car belongs to private assets and business drives earn a deduction of up to the employee’s tax-free kilometre allowance (€0.55/km in 2026). Car costs already deducted in the books reduce it. If the car was acquired for the business and business drives exceed 50% of its kilometres, it is a business asset: actual costs are deducted and the private share is calculated from the kilometres in the driving log.
• Per diem: a temporary business trip outside the business’s usual area of operation earns a deduction of up to the employee’s tax-free per diem (in 2026 up to €54 or €25 a day in Finland; abroad, up to the destination country’s foreign per diem). Travel days are itemised by duration in the tax return. As of October 2026 the Tax Administration’s page on sole traders’ deductions still shows the 2025 amounts (€53 and €24); the 2026 maximums equal the employee’s tax-free per diems.
• If actual costs entered in the books exceed the maximum deduction, only the actual costs are deducted.

The deduction requires a driving log or other reliable record showing, day by day, the destinations, distances and duration of the trips. For a trip by bus or train, the tickets attached to the books can serve as the record. Trips between home and your own business premises are private driving, not business drives.

A sole trader’s driving log: what goes into it?

According to the Tax Administration’s guidance for the self-employed, business and private driving are separated with a driving log (ajopäiväkirja) or other reliable record. The log must show the car’s total kilometres for the tax year, and each business drive should record:

• the start and end time
• the start and end point and, where needed, the route
• the distance
• the purpose of the drive
• the odometer reading at the start and end
• the driver.

Monthly totals alone are not enough. In an example in the Tax Administration’s guidance, an entrepreneur’s log lacked the length and times of individual drives, so most of the additional deduction was refused and a tax increase (veronkorotus) was imposed.

Reporting to the Incomes Register

The employer reports tax-free allowances on the earnings payment report under their own income types:

• Meal allowance (303)
• Kilometre allowance (tax-exempt) (311)
• Daily allowance (331) – including foreign per diems
• Deadline: by the 5th day of the month following the payment month. A month’s allowances can be reported in one report, with the month’s last payment date as the payment date.
• Not reported: accommodation reimbursements, ticket reimbursements based on a carrier’s receipt, and night travel allowances within the maximum. The part of a night travel allowance above the maximum is reported as Other compensation (216).
• Taxable travel reimbursements – commuting, or the part above the maximum – are salary: income type Other compensation (216), or for an own car Kilometre allowance (taxable) (209). They are reported within five days of the payment date.

Common mistakes

• Using last year’s rate. The 2025 rate of €0.59/km is no longer tax-free: for 2026 driving the maximum is €0.55/km, and anything above it is salary.
• Reimbursing commuting. It is not a business trip, so the payment is always taxable salary.
• An incomplete travel claim or log. Without times, destinations and kilometres the tax exemption cannot be shown. If the conditions are not met, the allowances are salary: taxes and statutory employer contributions are paid afterwards, and penalties may follow.
• Forgetting free meals. A lunch paid by a client halves the partial per diem; two free meals halve the full per diem.
• A meal allowance on top of a lunch benefit. If the employer’s lunch voucher or card can also be used on the trip, the meal allowance is not tax-free.
• A sole trader paying themselves per diems. The entrepreneur’s own travel costs go through the additional deduction in the tax return, not through tax-free payments.
• The same site for more than three years. Once the three-year limit is passed, the site becomes the regular workplace and tax-free allowances for trips there end.

Help with travel allowances and payroll

We handle bookkeeping and payroll for businesses: we check travel claims against the 2026 maximums, report the allowances to the Incomes Register under the right income types, and calculate a sole trader’s additional deductions for the tax return. An electronic driving log can also be enabled in the firm’s Vaavo app. We work in Finnish and Russian – get in touch and we will look at your company’s situation.

Official sources

• Vero: decision on tax-exempt allowances for business travel in 2026
• Vero: kilometre and per diem allowances
• Vero: detailed guidance on travel expense reimbursements (in Finnish)
• Vero: vehicle expenses and the driving log for the self-employed
• Vero: temporary work trips and the additional deduction (sole traders)
• Incomes Register: reporting reimbursements of expenses
• Finlex: Income Tax Act (1535/1992), section 71 (in Finnish)