A common practice in many companies is to pay their workers monthly fixed amount allowances to compensate for travel and subsistence expenses, treating them as income exempt from IRPF. However, a recent ruling confirms the criterion of the Tax Administration: when these allowances do not respond to real and verifiable expenses, they are taxed as wages.
We explain to you what this criterion is based on, what clues the Spanish Tax Agency uses to detect it, and what your company should do to avoid regularization.
The approach of administration and courts
General Rule: Diets Are Subject to IRPF
The judgment analyzed is based on a clear principle: diets are not exempt by default. To be outside the IRPF you must meet a specific condition:
- They must compensate for actual travel, maintenance or stay costs.
- Expenditures should be duly justified.
- The amounts must comply with the established regulatory limits.
The determining element: the actual purpose of the payment
The court makes a fundamental distinction that every company must be aware of:
- If they offset actual expenditures → are exempt from IRPF.
- If they pay back the job, although they are called diets → are salary subject to IRPF.
The name given by the company to the concept on payroll is irrelevant. What determines its tax treatment is the real nature of the payment.
The problem of fixed-rate allowances
An identical amount each month is a warning signal
The court notes a particularly relevant indication that the Inspectorate routinely uses:
- A diet of identical amount every month reveals that it does not respond to actual and variable expenses.
- The periodicity and uniformity of the amount are indicative of the fact that it is Covert remuneration, not a compensation of expenses.
Lack of supporting documentation
In addition to the fixed amount, the court notes other documentary problems that reinforce the position of the Administration:
- Absence of invoices, tickets or external supporting documents to prove the expenses.
- Internal documentation (e-mails, customer visit records) insufficient to prove actual movements.
- Lack of verifiable connection between the amounts paid and the expenditure actually incurred.
The burden of proof: what the company should prove
Although case law has progressively eased the burden of proof on the worker, the court recalls that the company cannot simply register the concept on the payroll. To defend the exemption, it is necessary to prove:
- The reality of displacement and its direct link to the work activity.
- The consistency between the amount paid and expenditure actually incurred.
- The existence of consistent, verifiable and preferably external documentation: invoices, card extracts, toll records, accommodation vouchers.
The lack of sufficient evidence allows the Administration to integrate all the amounts into the worker's tax base, with the fiscal and punitive consequences that this entails.
Requirements to be met by diets to maintain the exemption
What Yes Must Be Done
- Link each diet to actual and specific displacements, identified by date, destination and motive.
- Justify expenditure with sufficient documentation: invoices, tickets, mileage records.
- Maintain Amounts consistent and normally variable depending on the actual movements of each period.
What Can't Be Done
- Fixing the daily subsistence allowance flat rate regularly and uniformly.
- Use the diets for replace or supplement the salary covertly.
- Maintain fixed amounts without a change reflecting the reality of expenditure.
Why this criterion is relevant to your company
This criterion has a direct and high impact on the revisions of IRPF and retentions carried out by the Tax Inspectorate. The consequences of not conforming to it can be significant:
- Regularisation of quantities paid as a daily subsistence allowance, which becomes part of the worker's tax base.
- Liquidation of unused retentions, with the corresponding interest of delay.
- Imposition of sanctions For incorrect or insufficient retentions.
- Hidden labour costs resulting from the requalification of the amounts as salary.
The sectors most exposed to this risk are those with workers who carry out frequent shifts: commercial, field technicians, representatives, maintenance staff or installers.
What your company should review now
If your company pays fixed amount allowances to its workers, it is time to review:
- If the amounts vary depending on the actual movements of each period.
- If there is sufficient documentation to prove each posting and its employment link.
- If the amounts comply with the regulatory limits set out in the IRPF.
- Whether the internal diet policy is properly formalized and documented.
A preventive review of the daily subsistence allowance policy and its supporting documentation makes it possible to detect and correct tax contingencies before they are inspected, avoiding regularisations, penalties and additional costs for the company.
