What are daily allowances in Portugal?

What are daily allowances in Portugal and how do they work?

A daily allowance is financial support provided by the employer to reimburse employees for expenses related to business travel. These payments are exempt from income tax and Social Security contributions, but are subject to 5% autonomous taxation annually.

What is food allowance and how does it work?

The food allowance is a benefit paid to employees for each day worked to cover meal expenses during working hours. Typically, this allowance is calculated based on the actual days worked each month—on average, 22 days—and is paid monthly. It can be provided alongside salary payments or separately via meal cards or vouchers.

In 2025, the tax-free limits for the food allowance in Portugal are:

• €6.00 per day if paid in cash or by bank transfer.
• €10.20 per day if paid through a meal card or voucher.

Any amount above these limits will be subject to taxation. If you need further clarification on how this applies to your company, please contact the Accounting team.