Meal allowance in 2024: What amounts should you consider?

29 de December, 2023

The meal allowance is one of the most popular extra-wage benefits in Portugal. Although it is not mandatory, the vast majority of companies choose to grant this benefit to their employees in order to ensure that they have a decent meal during their working day.

Since the meal allowance is a supplementary benefit to the salary, the legislation does not set any limits – minimum or maximum – on the amount awarded to workers. The only reference is the amount paid in the public sector.

Find out with us what figures you should consider for your meal allowance in 2024.

Meal allowance amounts and tax framework

Order no. 107-A/2023 of April 18 updated the amount granted to public administration workers to €6.00/day. This amount will be maintained in 2024 and determines the maximum amount exempt from taxation in cash.

On the other hand, if the allowance is granted through a social voucher or card, the maximum amount exempt from taxation is 60% more, i.e. €9.60/day.

Thus, the taxation of the meal allowance varies depending on the format in which it is given to workers:

• Cash: total exemption from TSU for the company and from IRS and TSU for employees up to a maximum amount of €6.00/day. If the company wishes to allocate a higher amount, the respective discounts will apply to the remaining amount.
• Social voucher or meal card: total exemption from TSU for the company and from IRS and TSU for employees up to a maximum of €9.60/day. Above this amount, the respective discounts also apply.

The meal card is an increasingly popular option for Portuguese companies, as it allows them to maximize their employees’ disposable income without increasing their tax burden.

Practical example

For example, suppose you wanted to pay your employees €9.00/day in meal allowances.

If they chose to give this amount in meal cards, each employee would receive, on average, 232€ more per year than if they received the allowance in cash.

Your company, on the other hand, would save an average of 172€/year per employee thanks to the TSU exemption inherent in the card.

Make your simulation at any time.

At a time when the price of food continues to trend upwards – the basket of essential goods monitored by DECO reached its second highest value since 2022 in November 2023 – maximizing workers’ liquidity through the meal allowance is a very important way of mitigating the effects of inflation.

Note: in December 2024, the maximum exempt amount on the card will be €10.20/day.