November 10, 2023
What travel expenses are deductible for self-employed?
As a freelancer, you often incur travel expenses, which can add up significantly. Fortunately, some travel expenses are deductible. In this article, we will explain the rules regarding the deductibility of travel expenses so that you can make optimal use of this.
Business travel expenses
Naturally, the rule applies here as well that travel expenses are only deductible if the trip is business-related. This is where many entrepreneurs go wrong when deducting travel expenses. Many entrepreneurs consider their travel costs to go to their workplace/office as business expenses, but the Tax Authority does not view public transportation costs for commuting as business expenses. According to the Tax Authority, these costs are similar to those incurred by employees commuting from home to work. Examples of travel expenses that are considered business-related include those for representation and business contacts.
Are business travel expenses fully deductible?
In some cases, business travel expenses are fully deductible, while in others, they are limited. The distinction lies in the destination of your trip.
Business travel expenses related to representation, conferences, seminars, and study trips
These travel expenses are 80% deductible. In addition to transportation costs such as public transportation, a taxi, or a plane, the accommodation costs, for example, a hotel, are also 80% deductible in this case. There is a limit of a maximum of 1500 euros for deducting travel and accommodation expenses related to representation, conferences, seminars, and study trips. In general, freelancers do not exceed the 1500 euros limit. There are also exceptions to this limit in some cases.
Other business travel expenses
Other business travel expenses for public transportation, taxi, and plane that are not related to the four aforementioned categories are 100% deductible. Examples of these other business travel expenses include costs for meetings with clients, business partners, accountants, and business advisors.
Travel expenses for the business use of a private means of transportation, such as a private car
For most entrepreneurs, travel expenses do not only consist of public transportation, taxi, and plane costs. Many freelancers also make business use of their private car, motorcycle, or bicycle. In the case of the business use of a private means of transportation, you can deduct 21 cents per kilometer from your profit in 2023. In 2024, you can deduct 23 cents per kilometer from your profit, and for the year 2022, you can deduct 19 cents per kilometer. Note that this reimbursement of 21 cents per kilometer (for 2023) also applies to commuting kilometers. In the case of traveling with a private means of transportation, commuting expenses are considered business-related. Additionally, you can also deduct a portion of the VAT on your private car expenses such as fuel costs. In this article of ours, you can find detailed information on this.
Fortunately, travel expenses are fully or almost fully deductible in many cases. However, it's essential to remember that public transportation costs for commuting are not deductible because the Tax Authorities consider these costs as personal expenses. Also, you must always have proof of travel expenses, such as an invoice or a train ticket, to be eligible to deduct the costs.
