Travel and Subsistence under ERR: What Employers Need to Know

For many years, travel and subsistence sat in a grey area for employers.

Payments were often made informally, policies were loosely applied, and many businesses assumed that if an expense felt reasonable, it was probably fine from a tax point of view.

That landscape has changed.

With the introduction of Enhanced Reporting Requirements (ERR), travel and subsistence payments are now far more visible to Revenue.                                                                                                What was once low on the compliance radar is now clearly within view.

Understanding how travel and subsistence works under ERR is essential for Irish employers who want to avoid unnecessary risk.

At its core, ERR requires employers to report certain payments and benefits to Revenue through payroll submissions. This includes many types of travel and subsistence expenses, whether they are vouched or unvouched.

ERR has not radically changed what is allowable. What it has changed is transparency.

Revenue now receives more detailed information, more frequently, and in a format that allows data to be reviewed and compared easily. Patterns, inconsistencies and outliers are much easier to spot.

The most important distinction for employers to understand is the difference between business travel and ordinary commuting.

Business travel generally relates to journeys undertaken in the course of work, such as travelling to a temporary location or visiting clients. Ordinary commuting — travelling from home to a normal place of work — does not qualify for tax-free treatment, even if the employee occasionally works elsewhere.

This is where many employers make mistakes. Payments intended to cover normal commuting costs are sometimes treated as tax-free travel expenses. Under ERR, these payments are more likely to be identified and questioned.

Subsistence payments are similarly misunderstood.

Subsistence is intended to cover the cost of meals and accommodation where an employee is working away from their normal place of work. Revenue sets limits and conditions around these payments. Exceeding those limits or failing to meet the conditions can result in the entire payment becoming taxable.

Another common issue is flat-rate allowances.

Some employers pay fixed amounts for travel or subsistence without checking whether the employee’s journey actually qualifies. While this may feel administratively convenient, it creates risk. Under ERR, Revenue can see the payments even if supporting details are not submitted at the same time.

Documentation remains critical.

Employers are expected to retain records that support travel and subsistence payments. This includes details of journeys, locations, dates and reasons for travel. Even where payments are within Revenue limits, a lack of records can undermine the tax treatment.

What ERR has done is remove the comfort of informality.

Payments that were once made with minimal scrutiny now sit alongside payroll data, benefits information and other employment-related reporting. Revenue does not need to audit every employer individually — it can review trends and anomalies across sectors.

For businesses with mobile workforces or frequent travel, this makes robust processes even more important. Travel policies should be clear, applied consistently and reviewed regularly. Payroll teams need to understand how expenses are treated and reported.

ERR has also highlighted the importance of communication.

Employees may not understand why certain expenses are taxed or why additional information is required. Clear explanations help prevent frustration and protect trust.

From a payroll perspective, travel and subsistence should not be treated as separate from the wider payroll process. They interact with payroll submissions, tax reporting and compliance obligations.

When handled correctly, travel and subsistence payments can still be made efficiently and in line with Revenue rules. When handled casually, they can become a source of unnecessary exposure.

The key message for employers is not to stop paying travel or subsistence — it is to pay them correctly.

ERR is not about restriction. It is about visibility. Employers who recognise this and adjust their processes accordingly are far less likely to encounter issues.

As with many areas of payroll, the risk is rarely in the rule itself. It lies in assumptions, habits and outdated practices.

Contact RDA today to talk to our payroll specialists, or email Valerie Waters, Payroll Manager, at vwaters@rda.ie