Expense Reimbursement policy in Spain

Modified on: Wed, 3 Sep, 2025 at 1:37 PM

TABLE OF CONTENTS

Invoicing and Documentation
Reimbursement and Taxability
Travel and Mileage

This article outlines the policies and procedures for travel, mileage, invoicing, and reimbursement of business expenses for employees based in Spain.

Invoicing and Documentation

Expenses must be justified with back up documentation such as receipts and invoices. If possible, indicate the reason or any identifiable information that it is for work purposes and not personal.
If the transaction is less than 400 euros (or 3,000 euros in specific cases), a simplified invoice may be issued. If it exceeds these limits, a full invoice is required.
This means that expenses such as taxi fares, for example, do not require an invoice or receipt.

Reimbursement and Taxability

Tax-Free reimbursements

Expenses for transport tickets, meals, acommodation, during a business trip are tax exempt. In the case of travel and stay for a continuous period of more than nine months, said allowances will not be exempt from taxation.

Entertainment and Gifts

All gifts to customers would be subject to VAT, which does not affect payroll.

For employees, it is remuneration in kind and affects income tax.

Health and Wellness

If the expense is in the name of the company, it is a benefit in kind for the employee and is subject to income tax. For example, Gym pass membership paid by the employer.

Travel and Mileage

Mileage rate per KM

The amount paid is €0.26/km for 2025. In 2026, it would be €0.27/km.

Parking and Toll

Parking tickets and tolls are expenses and therefore are not declared to the tax authorities. They will be paid in the payroll and you will need to have the ticket receipt. This receipt must be kept by the company, not BDO.

Business Travel Restrictions

There are no restrictions to Business Travel.

Transport service Rules

There are no specific rules regarding transportation.

In this article...

Spain