As provided for in Article 1, paragraphs 81 to 83, of Law No. 207/2024, as of the financial year 2025, travel and entertainment expenses will only be deductible (or, in the case of reimbursements, non-taxable) if the relevant payment is made in a traceable manner.
In particular, only if the relevant payments are made in a traced manner:
- Reimbursements for allowances for transfers or missions outside the municipal territory, such as board, lodging, travel and transport performed by means of non-scheduled public transport services (including taxis and NCCs) referred to in Article 1 of Law No. 21/1992 (ex Article 51, Paragraph 5, TUIR) do not contribute to forming the employee's income;
- Expenses relating to hotel services, the provision of food and beverages, as well as travel and transport by means of non-scheduled public transport services pursuant to Article 1 of Law No. 21/1992, charged analytically to the principal, as well as analytical reimbursements relating to the same expenses, incurred for employee travel or paid to self-employed workers, are deductible (pursuant to Article 54, paragraph 6-ter, TUIR);
- expenses for board and lodging and those for travel and transport by means of non-scheduled public transport services pursuant to Article 1 of Law No. 21/1992 are deductible, as well as analytical reimbursements relating to the same expenses incurred for employee travel or paid to self-employed workers (pursuant to Article 95, paragraph 3-bis, TUIR);
- entertainment expenses are deductible (pursuant to Article 108(2) TUIR).
This provision must be coordinated with Article 54(2)(b) of the Consolidated Income Tax Act, pursuant to which, again as from the financial year 2025, reimbursements of expenses incurred by the art or profession for the performance of an assignment and charged analytically to the principal are not included in the formation of taxable income. At the same time, such expenses are not deductible from the self-employment income of the person incurring them (pursuant to Article 54-ter(1) TUIR).
While remaining at your disposal for any doubts or requests for clarification, we would like to take this opportunity to extend our best regards to all.