This article explains how employees can claim reimbursement for business‑related expenses in Lithuania, including mileage, travel costs, per diems, and required documentation. Reimbursements must comply with Lithuanian tax rules to remain non‑taxable.
1. Travel & Mileage (Personal Vehicle Use)
Official Mileage Rate
Lithuania applies a widely accepted tax‑free mileage rate for employees using a personal vehicle for business:
€0.30 per km (standard maximum)
This rate is generally treated as the upper tax‑free limit.
Employers may not exceed this rate tax‑free unless they can prove higher actual operating costs, which is rare and complex.
Mileage Log Requirement
All mileage claims must be supported by a mileage log showing:
Date of travel
Start and end location
Odometer readings
Business purpose
Total kilometres driven
Mileage reimbursed must reflect actual business kilometres only.
2. Parking, Tolls & Fuel
Parking tickets and tolls must be claimed separately
Receipts are required
These costs are not included in the €0.30/km mileage rate
Important: No Double Reimbursement
If you claim mileage, you cannot also claim fuel receipts
Double reimbursement (fuel + mileage) is not allowed and may result in taxation
3. Business Travel Rules
To be reimbursable and non‑taxable, travel must be:
Business‑related
Justified
Pre‑approved under company policy
There are no statutory caps on travel expenses, but companies commonly:
Limit reimbursement to local or domestic travel, unless international travel is explicitly approved
Apply reasonableness standards for cost and duration
4. Transportation & Accommodation
The following may be reimbursed when business‑related and supported by receipts or invoices:
Transportation
Air travel (economy class or reasonable fare expected)
Bus, train, and public transport
Taxi or ride‑share services
Taxi use often requires justification (e.g., late hours, no public transport, urgent meeting)
Rental cars (requires:
Invoice
Business justification
Separate fuel receipts if mileage is not claimed)
Accommodation
Hotels or short‑term lodging
Invoice or receipt required
5. Invoicing & Documentation Requirements
To qualify as tax‑free reimbursement, each expense must include:
Supplier invoice or receipt
Supplier name
Supplier Tax ID / VAT number
Date of expense
Amount
Description of the service or goods
In addition, the expense claim form should clearly state:
Employee name
Business purpose of the expense
Company Entity
Where possible, invoices should be issued to:
Horizons Global Technology Lithuania UAB
6. Simplified Receipts (Small Expenses)
Lithuanian rules allow simplified documentation for small expenses:
Up to €100: Simplified receipt is acceptable
Above €100: Full invoice required, including supplier VAT ID
Expenses above €100 without a compliant invoice may become taxable.
7. Common Tax‑Free Reimbursable Expenses
With proper documentation, the following are generally non‑taxable:
Business travel (airfare, public transport)
Accommodation and hotels
Business meals and client entertainment (strict documentation required)
Taxi or ride‑share services
Parking and tolls
Mileage reimbursement (up to €0.30/km)
Work‑related supplies, tools, or equipment
Conferences, seminars, and training related to your role
8. Per Diems (Daily Allowances)
Daily per diems may be reimbursed tax‑free when:
The business trip is outside the regular workplace
The trip lasts more than 8 hours
The per diem amount follows government‑approved rates
Typical 2025 Per Diem Rates
Domestic travel: €15 per day
International travel: Country‑specific, commonly €30–€60 per day
Amounts exceeding official rates may be treated as taxable income.
9. Entertainment, Gifts & Special Expenses
Business / Client Entertainment
May be tax‑free if:
Directly related to business
Reasonable in cost
Documented with:
Guest names
Business purpose
Receipt or invoice
Gifts
Small promotional gifts (< €50) are generally tax‑free
Higher‑value gifts may be taxable to:
The employee, or
The company (depending on purpose and recipient)
Wellness & Personal Expenses
Generally treated as taxable benefits, including:
Gym memberships
Yoga or swimming
Medical bills
Exceptions may apply if:
Provided equally to all employees
Structured as a compliant company‑wide wellness program
(Tax may still apply in many cases.)
10. VAT Treatment
Standard VAT rate: 21%
VAT treatment follows normal Lithuanian VAT rules
VAT may be recoverable only if:
Invoice is compliant
Expense is business‑related
The company is VAT‑registered
11. Submission & Compliance Rules
Employees must submit expense claims within the company deadline (commonly 30 days)
Expenses without proper proof may be:
Rejected, or
Treated as taxable income