The 3-month rule for per diem expenses in Germany

  • 15/01/2025
  • 3 minutter at læse

The 3-month rule applies to employees working for companies based in Germany, where daily per diem expenses are only considered tax-free for a maximum of three months of continuous travel to the same location. Any allowances granted for stays lasting longer than three months are subject to taxation.

You can use this feature in two ways: Display a warning or apply a taxable per diem rate.

  • Display a warning - a warning will display to the admin every time a per diem expense exceeding the three-month limit is submitted.
  • Apply a taxable per diem rate - per diem expenses connected with travels to the same location for more than three months will be posted as taxable.

To enable the 3-month rule for per diems:

  1. Search for Search Expense Management Setup.
  2. Under Per Diem, in the Enable 3-Month-Rule field, select one of the following options from the dropdown menu:
    • Warning on Per Diem - a comment will display to the admin in Business Central whenever an employee has submitted per diem expenses for more than three months, that have been calculated as 90 days at the same location
    • Taxable Per Diem - per diem expenses connected with travels to the same location (address code) for over three months will post as taxable.

Bemærk

You are asked if you want to enable taxable rates (required for this feature) for per diem expenses after choosing this option. For this option to work, you must also set up taxable per diem rates.

After you enable the 3-month rule, the Address Code field is added to per diem reporting in the Continia Expense App and the Continia Expense Portal.

For more information about per diems, see:

Overview of per diem expenses