Independently of whether an employee goes on a business trip or is seconded to work abroad, daily allowances are mentioned in the context of his/her departure. However, the role of daily allowances for a worker in the delegation and a posted employee is different. We will try to explain these differences in this article.
1. Daily allowance
The daily allowance constitutes a benefit paid to a worker to cover the increased costs of food. The minimum amount and rules for payment of daily allowances are specified in the the Regulation of the Minister of Labour and Social Policy of 29 January 2013 on the receivables due to an employee in a state or local government budgetary unit for a business trip (i.e. Official Journal of 2023, item 2190, as amended), hereinafter referred to as the regulation.
It should be emphasised that daily allowances are paid only to employees on a business travel – a delegation. Article 775 § 1 of the Labour Code determines the conditions that the departure should fulfil in order to be recognized as a delegation. This provision states: An employee who, at the employer’s request, performs a professional task outside the city where the employer’s head office is located or outside the regular place of work shall be entitled to receivables to cover the costs related to the business travel.
The essence of the delegation is its incidental nature. It doesn’t result in a change of the place of the performance of work, even temporarily. On the other hand, a change of the place of employment constitutes the essence of the secondment. The secondment takes place as a result of the conclusion of an appropriate agreement between the employer and the worker, the so-called export annex. The posted worker isn’t entitled to daily allowances.
2. Daily allowances for employees in the delegation
2.1. Domestic travel
The daily allowance for domestic travel is currently PLN 45.00 per day of trip. The amount of the benefit is determined taking into account the time when the domestic travel starts and ends. The following rules apply in this respect:
- if the journey lasts no more than 24 hours:
- up to 8 hours – no daily allowance is payable;
- from 8 to 12 hours – 50% of the daily allowance is payable;
- over 12 hours – the full daily allowance is payable;
- if the trips lasts longer than 24 hours, a full daily allowance is payable for every 24 hours, and for an incomplete but commenced day:
- up to 8 hours – 50% of the daily allowance is payable;
- over 8 hours – the full daily allowance is payable (§ 7(2) of the regulation)
If the employee is provided with free meals, including as a part of a hotel service, the amount of the daily allowance is reduced. The extent of the reduction depends on the type of meal that is provided to the worker:
- breakfast – this reduces the value of the daily allowance by 25%;
- lunch – this reduces the value of the daily allowance by 50%;
- supper – this reduces the value of the daily allowance by 25% (§ 7(4, 5) of the regulation).
The daily allowance won’t be due for the period of posting to the employee’s permanent or temporary place of stay or in the event that the worker is provided with free full-day meals (§ 7(3) of the regulation).
2.2. Travel abroad
The amount of daily allowances per day for business travel to individual countries is specified in the annex to the regulation. For example, the daily allowance for a day of travel: to Austria is €57 per day, to France €55 per day, Switzerland CHF 88 per day.
The daily allowance is to be baid at the rate applicable to the country of destination of the trip abroad. If the travel is to two or more States, the employer has the right to determine more than one country of destination (§ 13(2) of the regulation).
The worker should receive a full daily allowance for each day of travel abroad. If the trip doesn’t cover a full day, the amount of the daily allowance depends on the duration of the travel on that day:
- travel time doesn’t exceed 8 hours – 1/3 of the daily allowance is payable,
- travel time is from 8 to 12 hours – 50% of the daily allowance is payable,
- travel time exceeds 12 hours – the daily allowance is payable in full (§ 13(3) of the regulation).
The time of a business travel is counted as follows:
- travel by land transport – the time is counted from the moment of crossing the national border on the way abroad to the moment of crossing it on the way back home;
- travel by air – it begins at the moment of take-off of the plane on the way abroad from the last airport in the country and ends at the moment of landing of the plane on the way back at the first airport in the country;
- sea journey – it lasts from the moment of departure of the ship (ferry) in the last Polish port until the moment of arrival of the ship (ferry) to the first Polish port on the way back (§ 12 of the regulation).
An employer who provided a worker with free full-day meals during a trip abroad is obliged to pay only 25% of the daily allowance determined in accordance with the above rules.
The amount of the daily allowance is reduced by the cost of the free food (i.e. meals) provided to the worker. This rule also applies if the employee benefits from a hotel service that provides meals. The reduction in the value of the daily allowance occurs within the following limits:
- breakfast provided – this results in a 15% reduction in the daily allowance;
- lunch provided – this causes a 30% reduction in the daily allowance;
- supper provided – this results in a reduction of the daily allowance by 30% (§ 14(1,2,3) of the regulation).
The daily allowance isn’t payable in the event that the employee has received a cash receivable for meals from the employer. If the money receivable is less than the value of the daily allowance, the worker should be compensated up to the amount of the daily allowance due (§ 14(4) of the regulation).
3. Remuneration of a seconded employee
As mentioned earlier, seconded workers aren’t entitled to daily allowances. However, daily allowances, specifically the product of days spent abroad and daily allowances, are important when calculating the remuneration of the employees posted to work abroad.
3.1. Reduction of the social security contribution base
The social security contribution base of a posted employee is determined taking into account the modifications introduced by § 2(1)(16) of the Regulation of the Minister of Labour and Social Policy of 18 December 1998 on detailed rules for establishing the basis of assessment of contributions to the pension scheme (i.e. OJ 2025, item 316). This provision allows to reduce the contribution assessment base by the product of the number of days of stay abroad and the value of the foreign daily allowances, but the contribution assessment base after reduction can’t be less than the projected average gross monthly salary in the national economy.
Only employees posted to work abroad whose revenue is higher than the projected average gross monthly salary in the national economy can benefit from this institution. If the worker’s revenue is less, the reduction can’t occur. In the event that the employee has worked abroad for part of the month and in Poland for part of the month, or he/she has been ill either on leave, the amount of the average remuneration shall not be proportionally reduced.
The reduction shall be made by multiplying the days of stay abroad by the value of the foreign daily allowances. ″Days of stay abroad″ are considered to be any day of stay abroad, including scheduled days off from work and public holidays. On the other hand, days during which the worker was on sick leave or holiday leave either unpaid leave aren’t included.
3.2. Tax exemption for part of the revenue of persons temporarily staying abroad
According to the Article 21(1)(20) of the Personal Income Tax Act of 26 July 1991 (i.e. OJ 2025, item 163, as amended), hereinafter referred to as the Act: the income tax exemption concerns part of the revenue of persons referred to in Article 3(1), temporarily staying abroad and receiving revenue, in connection with this stay, from a business relationship, employment relationship, home based work and cooperative employment relationship, for each day of stay abroad, during which the taxpayer is in a business relationship, employment relationship, home based work and cooperative employment relationship, in an amount corresponding to 30% of daily allowance, specified in the regulations on the amount of and conditions for determining the receivables due to an employee in a state or local government budgetary unit for a business trip abroad, subject to paragraphs 15 and 15c.
The exemption in question may be used by a Polish tax resident who, in connection with a temporary stay abroad, obtained income from an employment relationship or from related relationships.
The exemption is granted in the amount of 30% of the product of the days spent abroad and the foreign daily allowances. When determining the number of days spent abroad, each day of the taxpayer’s stay abroad during which he/she remained in an employment relationship or a related one is taken into account, i.e. also Saturdays, Sundays, holidays. Days of stay abroad during which the taxpayer didn’t remain in an employment relationship or related one aren’t taken into account.
The exemption doesn’t apply to the remuneration:
- of an employee who is on a business trip outside the Republic of Poland;
- of an employee staying outside the borders of the Republic of Poland in order to participate in an armed conflict or to strengthen the forces of the state or allied countries, to participate in a peacekeeping mission, actions to prevent acts of terrorism or their consequences, as well as in connection with the acting as an observer in peacekeeping missions of international organisations and multinational forces, provided that he/she receives benefits exempt from tax under Article 21(1)(83) or (83a) of the Act;
- received by a foreign service member;
- obtained by a driver for performing international road transport on the basis of an employment relationship or a contract of mandate (Article 21(15) and (15c) of the Act).
4. Legal notice
The study is a work within the meaning of the Act of 4 February 1994 on Copyright and Related Rights (OJ 2006, No. 90, item 631, consolidated text, as amended). Publishing or reproducing this study or its part, quoting opinions, as well as disseminating in any other way the information contained therein without the written consent of Crede sp. z o.o. is prohibited.
