Meal and lodging expenses for professional drivers: taxable or exempt?

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Meal and lodging expenses for professional drivers (e.g., parcel service drivers) are refunded by the employer and are exempt from tax and social security contributions for up to €12. Legislation also provides that the employer may pay the employee a further amount of up to €12.

This additional provision for the employee is also exempt from social security contributions. It is tax exempt only if the employer subjects this additional expenditure to the flat-rate taxation of 25%.

The employer is entitled to pass on the payment of the flat-rate income tax to the employee. This gives employers considerable leeway in designing the net wage of an employee without generating unnecessary ancillary wage costs.
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