The right to deduct travel and expense allowances is extended

From 2025, the Tax Administration has made it easier to process travel and other work-related expenses.

The change will make it easier for users of the billing service to process tax-free travel expenses. Expenses can now be processed tax-free without being invoiced to the customer on a sales invoice. Light entrepreneurs will be able to choose whether to charge travel expenses to the customer or to declare them to the billing service as an expense/travel invoice for payment of their salary. The expenses are processed in accordance with the instructions of the Tax Administration when the salary is paid.

The same relief applies to light entrepreneurs who incur direct costs for their work, such as the cost of tools and equipment. These expenses are reimbursed as taxable allowances without withholding tax, which are declared as taxable income in the income register. In order to obtain the final tax deduction, these expenses must always be declared in your own tax return.

To summarise: a light contractor can agree with the client that the costs will be invoiced on the work invoice, or just declare the costs to Odeal as an invoice for payment of wages. Please note that expense invoices are not sent to the client separately. Expense reimbursements are paid from the tax-free amount on the sales invoice, and allow us to pay part of the invoice as a tax-free/taxable expense reimbursement, which is not subject to the same charges as a taxable salary.