How does it work?

As the name suggests, it compensates for the employee having to buy a snack or lunch while travelling. If an employee is entitled to a travel meal allowance, they are not also entitled to a meal voucher or flat-rate meal contribution for that day. 

For the employer, a correctly calculated meal allowance is a tax-deductible cost with no employer contributions payable. For the employee, it is income that is also exempt from insurance contributions and income tax.

The actual expense claim should be prepared by the employee using the rates they are entitled to under the law and their employer’s rules. They give the claim to the employer, who reimburses the correctly calculated meal allowance. 🙂

Meal allowances for business travel within Czechia

Entitlement arises when an employee is on a business trip for more than 5 hours. The amount then depends on the duration of the trip, and whether the employer provided a main meal (for example, breakfast included in accommodation). If so, the allowance is reduced. Meal allowance rates change each year by decree. The employer sets a specific rate within the permitted range in an internal policy. For 2022, the meal allowance is:

  • CZK 99–118 for a business trip lasting 5–12 hours,
  • CZK 151–182 for a business trip lasting 12–18 hours,
  • CZK 237–283 for a business trip lasting more than 18 hours.

The employer must pay the meal allowance and must respect the number of hours spent travelling, but the amount within the range is entirely their choice. Of course, the rate must apply company-wide: you cannot give Franta CZK 151/day and Jožka CZK 182/day, as that would be discrimination. 🙂

As mentioned above, reductions in meal allowances also follow set rules. For each meal provided, the employee’s allowance must be reduced by up to:

  • 70% for a business trip lasting 5–12 hours,
  • 35% for a business trip lasting 12–18 hours,
  • 25% for a business trip lasting more than 18 hours.
What if you pay below the minimum?

You could face problems with the Labour Inspectorate if an employee complains (in other words, reports you :-)).

What if you pay above the maximum?

The employer can choose to pay a higher meal allowance. However, the portion above the limits mentioned is subject to the usual insurance contributions and tax. In other words, it is treated like a cash bonus to the employee.

Meal allowances for business travel abroad 

If an employee spends part of a business trip abroad, they are entitled to a meal allowance based on the country to which you sent them. If they spend fewer than 18 hours in that country, they are entitled to only part of the allowance:

  • 1–12 hours → ⅓ of the foreign meal allowance,
  • 12–18 hours → ⅔ of the foreign meal allowance.

Again, check whether you provided the employee with a meal. If so, reduce the allowance by:

  • 70% for a business trip lasting up to 12 hours,
  • 35% for a business trip lasting 12–18 hours,
  • 25% for a business trip lasting more than 18 hours.

Calculating foreign meal allowances is by no means as simple as it may seem. There are exchange rates, border-crossing times, combinations of Czech and foreign allowances, and so on. It is therefore better to leave the calculation to your accountant. 🙂 

Pocket money – business travel abroad

If an employee travels abroad on business, you can also pay them pocket money. As an employer, you can deduct pocket money of up to 40% of the foreign meal allowance determined by the time spent abroad. The benefit? The employee receives money free of insurance contributions and tax. 🙂

Calculating meal allowances may seem complicated, and in some situations it is. Hopefully, though, you now have a clearer idea of what meal allowances and pocket money are. 🙂