Since January 2018, self-employed workers can also deduct allowances, i.e. maintenance and subsistence expenses arising from the development of their professional activity. However, the deduction of subsidies must respect certain limits.
Specialists from the Let’s Talk About Business portal point out that the regulation allows the self-employed to deduct their allowances, although there is a ceiling for daily expenses. The spending limit varies depending on whether or not maintenance and housing are included or just one of the two options.
According to the regulations, the self-employed can deduct a maximum of €26.67 per day from their personal income tax for dependency allowances in Spain; Up to a maximum of €53.34 per day for daily allowances and daily allowances in Spain. In the case of travel abroad, the limit increases to 48.08 euros per day for maintenance and 91.35 euros per day for maintenance and accommodation.
Thus, for daily allowances to be deducted from the IRS, they must be related to the exercise of the professional activity and be accompanied by an invoice proving the expenses.
In addition, expenses with food or housing must have occurred during the exercise of the professional activity. Depending on the freelancer’s activity, this can be difficult to justify, although it usually occurs from Monday to Friday during business hours.
For expenses, they must be registered at a hotel establishment, such as a bar, restaurant or inn and payment must be made electronically. In other words, a bank card, mobile payment or any other similar method, as this way it is traceable and easier for the IRS to verify.
Sometimes, the tax authority may ask for an electronic payment receipt. The physical ticket or invoice should not be presented at the start, but should also be kept for proof of living expenses if required. In case the cost of the daily salary is higher than the allowable one, the difference must be excluded, as it cannot be deducted from personal income tax.