merit-business-trips

name	merit-business-trips
version	1.0.0
description	How to record Estonian foreign business trips (välislähetus) in Merit Aktiva correctly: tax-free daily allowance (välislähetuse päevaraha), the VAT treatment of flights and hotels (which is NOT reverse charge), paying a non-employee's travel via a käsundusleping, and client/partner meals (vastuvõtukulud). All figures are the current statutory limits — verify against Riigi Teataja, since the 2025 reform raised several of them and older blog figures are stale. Use when: booking per diem, a trip expense report, a foreign flight/hotel invoice, a contractor's covered travel, or a business-partner dinner. TRIGGERS: "lähetus", "välislähetus", "päevaraha", "daily allowance", "per diem", "business trip", "trip expenses", "kuluaruanne", "aruandev isik", "reporting person expense", "vastuvõtukulud", "representation costs", "client dinner", "äripartnerite toitlustamine", "TÖR", "töötamise register", "tasuta töötamine", "käsundusleping travel".

Merit — Business trips, per diem, travel VAT & representation

Four separate streams that all show up around a business trip. Keep them apart — each has its own rule. The 2025 tax reform raised the päevaraha and representation limits; do not trust pre-2025 figures. Account codes below are referenced by their standard Estonian name — confirm the exact code in the company's chart with accounts list.

1. Välislähetuse päevaraha (tax-free daily allowance)

Rates — Tulumaksuseadus § 13 lg 3 p 1 (in force from 01.01.2025): tax-free 75 € / day for the first 15 days per calendar month, 40 € / day thereafter. Mandatory minimum — VV määrus nr 110 § 3 (from 05.07.2025): 40 € / day (the employer must pay at least this; may pay up to 75 € tax-free; above 75 € is a taxable fringe benefit on the excess).

Who qualifies (TuMS § 13 lg 3 p 1): an employee, official, or member of the management/control body (juhatuse/nõukogu liige) of the payer. A non-resident board member or employee is also exempt on the same terms — TuMS § 31 lg 1 p 7 (their fee/salary is still taxed under § 29, but the päevaraha is separately tax-free). A plain VÕS contractor does not get päevaraha (see §3).

Which days count — VV määrus 110 § 4:

• Destination must be ≥ 50 km from the settlement of the workplace (§ 4(1)).
• Departure day counts if the vehicle leaves the country at or before 21:00; return day counts only if it arrives after 03:00 (§ 4(2)). A red-eye landing at e.g. 00:40 means the arrival day does not count.
• The employer may reduce päevaraha by up to 70 % if free meals are provided (§ 4(4)) — optional.

Required document — VV määrus 110 § 2(3): a written decision (otsustus/käskkiri) stating sihtkoht, kestus, ülesanne, and the rates. Make it before the trip.

Recording in Merit: päevaraha is not payroll — do NOT run it through Merit Palk. Pay it as a reporting-person expense: Ost → Aruandvate isikute kuluaruanded → + Uus kuluaruanne, pick the aruandev isik, add the päevaraha on a line to the travel-expenses account (Töölähetuse kulud) with no VAT (override the account's default rate — päevaraha is not a VATable purchase). Save → Merit posts the GL entry and a liability to the person; settle it from the bank under Pangamaksed / Võlgnevused. Within-limit päevaraha is not reported on the TSD (only the excess over the limit is a fringe benefit on TSD lisa 4).

2. VAT on flights & hotels — NOT reverse charge

This is the common mistake. Travel has special place-of-supply rules, so the general reverse-charge logic (for SaaS/consulting) does not apply.

• Flights — international air passenger transport: zero-rated, no domestic VAT, not reverse-charged, not on the KMD as an acquisition. Book gross to the travel-expenses account.
• Hotels — accommodation: place of supply is where the property is (KMS), so the foreign hotel charges its local VAT. Book gross, no domestic input VAT, not reverse-charged. (EU foreign VAT may be reclaimable via cross-border refund; usually not worth it for small sums.)

Do not route flight/hotel invoices through the reverse-charge skill.

3. Paying a non-employee's travel (contractor / käsundusleping)

Someone who is not an employee or board member cannot receive tax-free päevaraha. But the company can still pay their travel + accommodation cleanly if there is a real business basis:

• Engage them under a written käsundusleping / töövõtuleping — it may be tasuta (unpaid) for the work itself — stating the company bears the necessary travel/accommodation costs. The legal basis is VÕS § 628 (the mandator reimburses the mandatee's necessary costs). The documented costs are then the company's deductible expense and not the person's taxable income. Book flights/hotels to the travel-expenses account (VAT per §2). No päevaraha.
• Register the person in TÖR (töötamise register) before their first work day — even if unpaid (MKS § 25¹). For unpaid work the töötamise liik is "Tasuta töötamine"; töökoha aadress = the employer's domestic address for a short trip abroad (do not mark välisriik); no social tax arises.
• Skipping the contract/registration risks the travel being a taxable erisoodustus to the related board member/employee under TuMS § 48 (income tax 22/78 + 33 % social tax) — and an unregistered worker risks a penalty.

4. Client / partner meals — vastuvõtukulud (TuMS § 49)

A genuine business-partner meal/reception (food, accommodation, transport, entertainment for guests/partners) is representation, a different stream from travel and from päevaraha.

• Tax-free up to 50 € per calendar month + 2 % of that month's social-tax-charged payroll — TuMS § 49 lg 4 (the 50 € figure applies from 01.01.2025; older "32 €" is stale). Unused allowance carries forward within the calendar year (§ 49 lg 5). Excess is taxed 22/78 and declared on TSD lisa 5.
• The host's own meal counts when the company's people are at the event on work duties (hosting partners) — EMTA treats that portion as vastuvõtukulud, not a fringe benefit. This explicitly covers representation costs incurred on a foreign business trip. The opposite case — an event really for the staff with a few guests — is split, and the staff portion is erisoodustus.
• Book to the Vastuvõtukulud account, no deductible VAT (representation input VAT is non-deductible). Keep the receipt + guest names + company + business purpose + date.

Quick map

Cost	Stream	Account	VAT	Reported
Per diem to employee/board (incl. non-resident)	päevaraha	Töölähetuse kulud	none	not on TSD if within limit
Flights	travel	Töölähetuse kulud	zero-rated, gross	not reverse charge
Foreign hotel	travel	Töölähetuse kulud	foreign VAT, gross	not reverse charge
Non-employee's covered travel	VÕS § 628 + käsundusleping + TÖR	Töölähetuse kulud	as above	TÖR registration; no päevaraha
Business-partner meal	vastuvõtukulud	Vastuvõtukulud	non-deductible	TSD lisa 5 on excess over 50 € + 2 %