We would like to inform you that the 1st of July 2026 Government of the Republic of Lithuania ruling amendment No. 526 “Payment of Daily Allowances and Other Business Trip Expenses” will come into force as of 1st of October 2026. The key changes are as follows:
- Daily allowances for 1 day business trips within Lithuania will no longer be payable. Daily allowances may be paid only if a business trip within the territory of the Republic of Lithuania lasts more than 1 day. If the employer nevertheless decides to pay daily allowance for a 1 day domestic business trip, such payment will be treated as employee income and taxed as payroll.
- If the first and/or last day of a business trip lasts less than 4 hours, only 20% of the applicable daily allowance will be paid for that day. It is important to note, that the duration of the business trip includes travel time to and from the workplace designated by the employer.
- Reduced daily allowance rates may be indicated in the collective agreement or, when a business trip lasts at least 7 days, in the company internal policy or other internal regulatory document. Rates set in a collective agreement may not be lower than 50%, while rates established in the internal policy may not be lower than 65% of the maximum daily allowance rates approved by the Government. Any agreement to apply reduced daily allowance rates in the employment contract is considered invalid.
- When reduced daily allowance rates are applied, the employees must be informed of them in writing before the start of each business trip.
- For international business trips, the daily allowance for the departure day is determined according to the rate applicable in the country (or city) of destination.
- The daily allowance for the return day is determined according to the rate applicable in the country (or city) from which the employee returns.
- When a business trip involves several countries, daily allowances are calculated based on the rates applicable in each country for the actual days spent there.
- If more than one country is visited on the same day, the daily allowance for that day is calculated as the average of the applicable rates, except where entry into another country occurs solely due to a connecting flight or transit.
- If the business trip itinerary changes during the trip and the destination country (or city) changes, daily allowances must be recalculated based on the newly visited country (or city).
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Please note that this article highlights only the most significant changes. In specific cases, please refer to the full legislation and its provisions.
Source of the legal act: https://www.e-tar.lt/portal/lt/legalAct/090df81276b311f1b53dfa020e517810
