Myths and truths about meal allowance in Portugal

16 de September, 2022

If you have a job, then you most likely receive a meal allowance. This allowance is granted by companies, both public and private, with the aim of ensuring that employees have access to a nutritious and decent meal during the working day.

But do you know everything about the meal allowance? Do you know how it can be paid in Portugal? Do you know who is entitled to receive it? Discover some myths and truths about the meal allowance in Portugal.

The payment of meal allowances is compulsory – Myth

Contrary to what you might think, companies are not obliged to pay meal allowances. It is not included as compulsory in the Labor Code and is therefore only payable if it is provided for in an individual employment contract or collective agreement.

Even so, the meal allowance is considered a social benefit and most companies choose to give it as a supplement to remuneration.

The minimum meal allowance is €6.00/day – Myth

This is only true for public sector companies. In fact, in April 2023 there was an interim increase in the value of the meal allowance, which was updated for civil service workers.

As far as private companies are concerned, however, there is no set minimum. The €6.00/day is often used as a baseline, but companies are completely free to pay any other amount.

Both companies and employees have tax benefits associated with the meal allowance – Truth

There are tax benefits associated with the payment of meal allowances. In the case of the company, it is exempt from TSU. The employee is exempt from IRS and Social Security.

However, these tax benefits apply to different amounts depending on how the allowance is paid. If the allowance is paid in cash, the exemptions only apply up to €6.00/day. In the case of payment by voucher (social voucher), this amount becomes €10.20/day.

Since the tax-free amount is higher when the allowance is paid in cash (e.g. by card), this ends up being the solution adopted by most companies, which in this way manage to maximize employee liquidity without increasing the tax burden.

A company with a canteen is exempt from paying the allowance – True

Companies that provide a free canteen service for their employees are not obliged to pay meal allowances.

Teleworkers still entitled to meal allowance – Truth

Even when teleworking, a company’s employees who were already receiving this benefit – because it was provided for in the individual contract or in the collective bargaining agreement – are still entitled to receive it, as provided for in Law no. 83/2021, of December 6th, which amends the legal framework for teleworking and came into force on January 1st, 2022.

The purpose of the meal allowance is to ensure access to decent food during the working day, regardless of where the employee works.

Part-time workers are not entitled to meal allowance – Myth

If you work part-time in a company that gives its employees a meal allowance, then you are also entitled to receive it, if it is included in your individual or collective employment contract.

If you work five or more hours a day, you will receive the full amount (the same as full-time workers). If you work less than five hours a day, then the allowance is calculated in proportion to the workload.

Did you know all these aspects of paying meal allowances in our country? Tell us all about it!

Article updated in December 2024.