Travel deductions are one of the most overlooked deductions. Epinion has found that almost 1 million Danes miss out on this deduction every year. This is the equivalent of up to 11 billion DKK per year in travel deductions that are not reported to Skat.
The same study has found that 42% of Danes travel for work every year. Even if you only travel for the duration of a single day, you may be eligible to receive a deduction of up to 728 DKK per day (2019). Even if the meals and accommodation are covered by the employer, you may still be able to get some money reimbursed. We will revisit this point further down in the article.
In this article, we will cover:
What a travel deduction is
Instances where your employer is already covering your expenses
Other conditions you will need to be aware of
Whether you are eligible to receive any deductions
What is a travel deduction?
A travel deduction is a deduction you may be eligible for if you have been out traveling for work. It is intended to cover the extra expenses you may have in connection with your travels.
It can cover everything, ranging from you having paid for your accommodation or for your meals yourself, or if you paid for your own train tickets, flight or even a water bottle.
What if I get an 'allowance' or a 'diet' by my employer?
Some work places choose to pay for so-called "tax-free travel allowances" or "diets". That means that your employer pay a sum of money directly to your bank account based on an estimate of your expenses.
In such cases, it is crucial to check whether you have been properly compensated for your expenses by your employer. If they are paying less than the rates presented by Skat, you are still eligible for a deduction.
There may also be instances in which the employer has only compensated for you for your meals and hotel (accommodation), but not for so-called "small necessities". Thus, you will still be eligible for a deduction for these.
If you have been so organized as to save your receipts, you may also be eligible for a deduction if you ended up having more expenses than your employer expected you to.
See how you can check whether you have money to be made towards the bottom of the article.
What if my employer reimburses me for my expenses? Or if I have a company card?
Some work places choose to reimburse your expenses. If that is the case for you, there are still things worth checking up on. Even if your employer has paid for all of your expenses, you can still be eligible for a deduction for "small necessities". These are calculated for each day of your travels, and it can quickly become a substantial amount in the span of a year. In addition thereto, you may also be eligible for a deduction if there are some meals or other travel expenses that have not been reimbursed by your employer as long as you still have the receipts.
If you have a company card instead, the same deduction can be applied in the case of "small necessities". So even if your employer has paid for everything with the company card, you may still be eligible to receive a deduction for each day you have been out traveling.
What else do you need to be aware of?
The travel deduction has several other conditions, wherein some of the most important ones are:
You travels must be of at least 24 hours
You are not allowed to spend the night in your own home
You are not eligible for a deduction if it is unpaid work, e.g. if you are a volunteer
You must calculate per hour for the day of departure and day of return
Check to see if you are eligible for any deductions
The travel deduction is currently not sufficiently utilized. This is in spite of the fact that it can quickly amount to several thousand Danish kroner, even if the employer is paying for the trip.
However, it is crucial to be aware of all of its conditions, calculations, standard rates etc. This can easily become somewhat of a jungle to navigate.
That is why we at Tax Helper have created an easy and intuitive platform that comfortably allows you to check if you are eligible for a travel deduction and ensure you make it all the way to the finish line in terms of reporting your deductions to Skat. It is free to try out, and you only pay if you save money on taxes.