If you run an Estonian OÜ and travel abroad for business, your company can pay you up to EUR 75 per day completely free of income tax and social tax. No receipts needed for the per diem itself. For a 15-day trip, that is EUR 1,125 in your pocket with zero tax — compared to roughly EUR 750 net if the same amount were paid as a board member fee.
Most OÜ owners either don't know about this allowance or assume the paperwork isn't worth it. The documentation is actually straightforward: one document (a travel order) and you're done.
The Rates (From 1 January 2025)
The tax-free daily allowance (päevaraha) rates increased significantly at the start of 2025:
| Duration | Tax-Free Rate (2025+) | Previous Rate (until 31 Dec 2024) |
|---|---|---|
| First 15 days per calendar month | EUR 75/day | EUR 50/day |
| Day 16 onwards per calendar month | EUR 40/day | EUR 32/day |
The 15-day count resets each calendar month. If you travel 10 days in March and 10 days in April, all 20 days qualify for the EUR 75 rate because neither month exceeds 15 days.
For a month where you travel 20 days, the first 15 days are at EUR 75 and days 16-20 are at EUR 40. That gives you EUR 1,125 + EUR 200 = EUR 1,325 tax-free for the month.
What Qualifies
Not every trip counts. The rules are specific:
Must be a foreign business trip. There is no tax-free daily allowance for domestic travel within Estonia. The destination must be outside Estonia.
50 km minimum. The destination must be at least 50 km from the border of the settlement (linn, vald) where your workplace is located. For most Estonian companies with a registered address in Tallinn, any foreign destination qualifies easily.
Overnight stay required. Single-day trips — even abroad — do not qualify for the daily allowance. The trip must include at least one overnight stay. A same-day return flight to Helsinki does not count.
Legitimate business purpose. The trip must serve a genuine business purpose: client meetings, conferences, supplier visits, market research. "Working from a cafe in Lisbon" is not a business trip — that is remote work.
Documentation: The Travel Order
The key document is the travel order (lähetuskäsk or lähetuskorraldus). This is an internal company document — not a tax form you submit to EMTA. You keep it in your records.
The travel order must include:
- Employee or board member name
- Destination (city, country)
- Business purpose of the trip
- Travel dates (departure and return)
- Daily allowance amount per day
That is the entire requirement for the per diem. No meal receipts, no daily expense reports, no hotel breakfast tracking. The per diem is a flat daily rate and requires no receipts to justify.
However, other trip expenses — flights, accommodation, taxis — do need receipts. These are regular business expenses and are documented normally with invoices.
Sample Travel Order
A travel order can be as simple as a signed document stating:
Travel Order No. 2026-03
The company OÜ Example (registry code 12345678) sends board member [Name] on a business trip:
- Destination: Berlin, Germany
- Purpose: Client meetings and partnership discussions
- Dates: 10 March 2026 – 14 March 2026 (5 days)
- Daily allowance: EUR 75/day, total EUR 375
- Additional expenses (flights, accommodation) reimbursed against receipts
Signed: [Board member / authorised person], [Date]
There is no prescribed format. The document just needs to exist and contain the required information.
Meal Reduction Rule
If free meals are provided during the trip — for example, the conference includes catered lunches and dinners, or the client hosts all meals — the employer can reduce the daily allowance by up to 70%.
This is a can, not a must. The employer decides whether to apply the reduction. In practice, most small OÜ owners paying themselves do not apply it, since the company is simply paying the allowance to its own board member.
If applied, the reduced rate for a EUR 75 day would be EUR 75 x 30% = EUR 22.50/day.
Worked Example: Travel Allowance vs. Board Member Fee
Here is the comparison that matters. You travel abroad for 15 business days in a month and the company pays EUR 1,125 either way. What is the actual cost?
Scenario A: EUR 1,125 Paid as Board Member Fee
| Component | Amount |
|---|---|
| Gross board fee | EUR 1,125.00 |
| Personal income tax (22%) | -EUR 247.50 |
| Funded pension (2%) | -EUR 22.50 |
| Net to board member | EUR 855.00 |
| Social tax (33% on gross) | EUR 371.25 |
| Total company cost | EUR 1,496.25 |
The company spends EUR 1,496.25. The board member receives EUR 855.00.
Scenario B: EUR 1,125 Paid as Travel Allowance
| Component | Amount |
|---|---|
| Daily allowance (15 days x EUR 75) | EUR 1,125.00 |
| Personal income tax | EUR 0 |
| Social tax | EUR 0 |
| Net to board member | EUR 1,125.00 |
| Total company cost | EUR 1,125.00 |
The company spends EUR 1,125.00. The board member receives EUR 1,125.00.
The Difference
| Board Fee | Travel Allowance | Saving | |
|---|---|---|---|
| Net received | EUR 855.00 | EUR 1,125.00 | +EUR 270.00 |
| Company cost | EUR 1,496.25 | EUR 1,125.00 | -EUR 371.25 |
By using the travel allowance instead of a board member fee, the board member gets EUR 270 more in their pocket and the company saves EUR 371.25 in total cost. The difference comes entirely from the income tax (EUR 247.50), funded pension (EUR 22.50), and social tax (EUR 371.25) that apply to board fees but not to travel allowances.
To frame it differently: if the company wanted the board member to receive EUR 1,125 net via a board fee, it would need to gross up to approximately EUR 1,125 / 0.76 = EUR 1,480.26, plus 33% social tax on that gross — a total company cost of roughly EUR 1,968.75. The travel allowance achieves the same net payment at EUR 1,125 company cost. That is a 43% reduction in total cost.
What Happens If You Exceed the Limits
If you pay a daily allowance above EUR 75 (or EUR 40 for day 16+), the excess is taxed as a fringe benefit (erisoodustus). The tax treatment is punitive.
Example: EUR 100/day paid instead of EUR 75/day (EUR 25 excess per day)
For one day of excess:
| Component | Amount |
|---|---|
| Excess amount | EUR 25.00 |
| Gross-up (25 / 0.78) | EUR 32.05 |
| CIT at 22/78 | EUR 7.05 |
| Social tax at 33% on gross-up | EUR 10.58 |
| Total tax on EUR 25 excess | EUR 17.63 |
The effective surcharge on the excess is roughly 70%. A EUR 25 overpayment costs an additional EUR 17.63 in taxes. Over 15 days, that is EUR 264.45 in additional tax.
The lesson: stay within the limits. EUR 75/day for the first 15 days, EUR 40/day after that, per calendar month.
Fringe benefits are declared on TSD Annex 6 by the 10th of the month following the month the benefit was provided.
Practical Tips
Split long trips across calendar months. The 15-day EUR 75 threshold resets monthly. A 20-day trip in March gives you 15 days at EUR 75 + 5 days at EUR 40 = EUR 1,325. The same 20 days split as 10 in March + 10 in April gives you 20 days at EUR 75 = EUR 1,500 — an extra EUR 175 tax-free.
The travel order can be created after the trip. There is no requirement to issue it before departure — though creating it beforehand is cleaner documentation practice.
Board members qualify. This allowance applies to both employees and board members. Solo OÜ owners who are their own board members can pay themselves the daily allowance.
Combine with other business expenses. Flights, accommodation, and other trip costs are separate business expenses — they are not limited by the daily allowance cap. The EUR 75/day covers meals and incidental expenses. Flights and hotels are reimbursed on top, with receipts.
Arvello's Business Trip Logger
Arvello tracks your business trips and calculates the tax-free daily allowance automatically. Log your trip dates and destination, and Arvello generates the travel order, calculates the correct per diem (accounting for the 15-day threshold per calendar month), and includes the allowance in your monthly tax calculations.
If a trip pushes you past the 15-day monthly limit, Arvello flags the rate change to EUR 40/day so nothing is missed.
