Per diem rates in Portugal: a brief guide (2024)

The phrase “per diem” means “by the day” in Latin. Per diem rates are standard rates paid by employers to their employees to cover the cost of a business trip. This daily allowance covers business expenses incurred on the trip, like food, accommodation, transportation, and more. Many governments provide guidelines for per diem rates.

While Portugal doesn’t have any legislation on per diem rates for the private sector, most employers use the public sector rates as a standard. These are defined in several pieces of Portuguese legislation, such as

Decree-Law No. 106/98 of April 24th

,

Ordinance No. 1553-D/2008 of December 31st

, and

Decree-Law No. 137/2010 of December 28th

.Per diem rates in Portugal are tax-exempt up to a certain amount. Amounts greater than the government-defined amount are taxable.

Portugal’s per diem rates cover travel expenses and transportation when employees are displaced from their necessary domicile for work-related reasons.  A “necessary domicile” is considered:If free meals or accommodation are provided, the per diem rate is not offered. The per diem rate may cover accommodation, or it may be replaced with a reimbursement of the price of a hotel with up to three stars or equivalent, up to a limit of 50 euros.

Travel that takes place within a period of 24 hours and doesn’t imply the need for new expenses is considered daily travel. Daily travel expenses may be covered by a per diem if the travel is more than 20 km from the necessary home. Travel that takes place for more than 24 hours is considered successive-day travel, and is covered if it’s more than 50 km from the home. These amounts are calculated from the outskirts of the location where the employee has their domicile to the closest point to the destination. 

If the travel covers, even partially, the periods between 1 pm and 2 pm or between 8 pm and 9 pm, the daily allowance is paid out at 25%. If the travel involves accommodation, the daily allowance is paid out at 50%. This applies to travel that does not extend into the next day, when the employee lacks access to public transport to return to their residence by 10 pm. 

Per diem amounts can be claimed for successive-day travel for up to 90 days. All days are compensated at 100%, except for the day of departure and the day of return. For these, the following rules apply:Day of departure: 

The Portuguese government has the same per diem rates across the country. Other countries may have their own per diem rates for individual Portuguese cities. For example, the US federal government per diem rates for Lisbon, Portugal are:

The per diem rates for Portugal vary by country. US rates are listed above, while UK rates can be found on

the government website

. The UK government offers per diem rates for several Portuguese cities and regions. These include: Azores, Portugal:

It’s good practice to pay for employees’ expenses when they’re travelling on business, and per diem allowances offer a convenient way to do this. It’s important to know about government standards for per diem rates to make sure your company is complying with tax regulations. Per diem rates have many benefits: they can help create more predictable budgets, reduce paperwork, simplify travel for employees, and ensure fairness by standardising reimbursements. Be sure to familiarise yourself with Portuguese government guidelines for per diem rates when planning business travel in Portugal. If you’re travelling internationally, consult your own country’s per diem rates for business travel in Porto, Lisbon, or elsewhere.