Is it necessary to declare compensation for business trip expenses: clarification

Before filling out the annual electronic declaration, declarants should consider that not all funds related to business trips are considered income. In many cases, compensation for travel, accommodation, meals, and other expenses does not need to be declared, but the legislation also provides exceptions. "Judicial and Legal Newspaper" analyzed the provisions of the Law "On Prevention of Corruption" and the NACP clarifications regarding which payments must be indicated in the declaration and which do not.

Which business trip expenses do not need to be declared

As a rule, funds received as reimbursement or coverage of business trip expenses are not subject to declaration.

This applies to cases when compensation is made from the state or local budget, international intergovernmental organizations, international technical assistance, or the organizer (co-organizer) of the event for participation in which the person is on a business trip.

It is also not necessary to declare income in the form of coverage by a third party, such as an international organization or a foreign state authority, of expenses for the participation of the declarant or a family member in a seminar, conference, negotiations, or other event held in another city or abroad. This specifically concerns payment for travel to the event location, accommodation, meals, visa fees, and other travel-related expenses.

At the same time, such a trip must be properly formalized as a business trip of the declarant or a family member.

When compensation must be reflected in the declaration

However, the legislation provides an exception to this rule.

The amount of funds excessively spent by the employer is not considered business trip expenses. It is income of the declarant and must be reflected in section 11 "Income, including gifts" of the electronic declaration.

As a rule, information about such income is contained in the certificate from the State Register of Individuals on paid income and withheld taxes according to subparagraph 164.2.11 of paragraph 164.2 of article 164 of the Tax Code of Ukraine.

Example: business trip abroad at the expense of the host party

As an example, the NACP cites a situation when a declarant, at the invitation of a foreign state authority, participates in an event held abroad, and all expenses are paid by the host party.

If a business trip is formalized at the workplace, funds spent on travel, accommodation, meals, visa fees, and other related expenses are not indicated in the declaration.

Is it necessary to declare compensation for a family member's business trip

The situation is separately clarified when a family member of the declarant, who is not a person authorized to perform state or local government functions or equated to such a person, goes on a business trip.

If the family member receives compensation for business trip expenses from their employer or participates in an event whose expenses are covered by the host party, such funds also do not need to be indicated in the declarant's declaration.

Thus, compensation for business trip expenses by itself does not mean the occurrence of income that must be declared. If expenses are compensated in cases provided by the Law "On Prevention of Corruption," they are not reflected in the electronic declaration. At the same time, funds excessively spent by the employer are considered income and must be declared.

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