How does Horizons handle employee expenses in Finland?

TABLE OF CONTENTS


In Finland, expenses for employees are subject to specific tax treatment and reimbursement guidelines. Knowing what qualifies as taxable or tax-free can help both employees and employers navigate reimbursements effectively. 


Below is a detailed guide to expense reimbursements in Finland, covering key expense types and the necessary documentation to ensure compliance.


1. Are Personal Phone Bills Reimbursable?

Yes, but with tax implications. When an employer reimburses an employee’s personal phone bill, this reimbursement is classified as taxable income. This means it will be added to the employee's total income for tax purposes.

  • Tax Treatment: Taxable income


2. How Are Transportation and Fuel Costs Managed?

Transportation and fuel expenses are eligible for tax-free reimbursement if specific requirements are met.

  • Tax-Free Reimbursement Eligibility: To be reimbursed without incurring tax, these expenses can be claimed as a kilometre allowance.
  • Required Documentation: Employees must submit a travel diary that documents each trip to qualify for tax-free treatment.
  • If No Travel Diary is Submitted: Without a travel diary, any reimbursement for transportation and fuel costs will be treated as taxable income.


3. What Rules Apply to Business Meals and Alcohol?

Reimbursement for business meals and alcohol follows stricter guidelines.

  • Standard Tax Treatment: Business meals and alcohol expenses cannot be reimbursed tax-free based solely on receipts.
  • Conditions for Tax-Free Reimbursement:
    • Employees must submit a travel diary.
    • Expenses can then be processed as part of a per diem allowance, which is tax-free for one per diem per travel day.
    • Additional Per Diems: Any additional per diems beyond the first per travel day will be considered taxable income.


4. How Is the Travel Allowance Processed?

Employees have the option to claim either a travel allowance or itemized expense reimbursements—but not both.

  • Single Option Requirement: Only one type of reimbursement can be claimed for each trip.
  • Documentation for Tax-Free Reimbursement:
    • A travel diary is required to process per diems and kilometre allowances as tax-free reimbursements.

5. How to complete a Travel Diary

  • Download and complete your Travel Diary (template attached at the bottom of this article).
  • Save it as a PDF to submit in your expense reimbursement request.
  • Please make sure to include the following:  
    • Traveler Info: The individual who made the trip (name, employee id, or equivalent information). 
    • Purpose of the Trip: The reason for the trip (e.g., meeting, trade fair, client visit). 
    • Date and Duration of the Trip: The dates and times when the trip started and ended. It is also recommended to specify the duration of the trip with time accuracy. In abroad travel travel domestically and internationally needs to be separated. 
    • Destination: The location of the trip. 
    • Mode of Transportation: The means of transport used (car, train, airplane, etc.) and the vehicle registration number if a car was used. I car was used was it employees own car? 
    • Kilometers: If mileage reimbursement is being claimed, include the odometer readings at the start and end of the trip, as well as the exact route and total kilometers traveled. 
    • Attachments: Receipts for all expenses related to the trip (flight tickets, hotel invoices, taxi receipts, possible entrance fees). 
    • Per Diem Allowance: If the trip is long enough to qualify for a per diem, indicate the amount claimed in the report. 
    • Other Expenses: Any other travel-related expenses for which reimbursement is being requested. 
    • Additional Information: Any other relevant details, such as travel companions or special circumstances. 

Per diems would need to follow the national amounts; In 2025, the tax-exempt reimbursements of travel expenses are as follows:   
  • full daily allowance: €53 (in 2024: €51)  
  • partial daily allowance: €24 (in 2024: €24)  
  • meal allowance: €13.25 (in 2024: €12.75)  
  • tax-exempt kilometre allowance: €0.59 per kilometre (in 2024: €0.57/km).


5. Are Hotel Accommodation, Flights, and Event Fees Reimbursable?

Yes, hotel accommodation, flights, and event fees can be reimbursed tax-free when supported by valid receipts.

  • Tax Treatment: These expenses are classified as tax-free reimbursements provided the employee submits legitimate receipts.

Key Compliance Takeaway

Following these guidelines for expense reimbursements in Finland is crucial for tax compliance. Proper documentation, particularly a travel diary, plays a vital role in determining tax-free eligibility and ensures smooth reimbursement processing.


For more details, we recommend reviewing the official website of the Finnish Tax Administration (officially called "Verohallinto in Finnish): Individuals - vero.fi 




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