Per diems from 1 October 2026 – what changed and what not to miss

The employee is packing for a trip; the accountant is preparing for new calculations. The suitcase is the same, but from 1 October 2026 per diems are worked out differently: what now matters is how long the trip lasts, the hours of departure and return, and the document that sets any reduced per diems.

The changes concern Lithuanian companies that send employees on business trips within Lithuania and abroad. Below are the main changes and the practical steps worth taking now.

A one-day trip within Lithuania – no per diems

From 1 October per diems for a business trip within Lithuania are paid only when it lasts longer than one trip day. You can still send an employee to a meeting, training or a trade fair for a day, but no per diems are paid for such a trip. Travel and other justified trip expenses are reimbursed under the usual rules.

For trips abroad, per diems are due even for a one-day trip.

A one-day meeting in Kaunas and a one-day meeting in Riga now lead very different lives as far as per diems go.

When is a day paid at only 20%?

If the first and/or last day of a trip lasts less than 4 hours, it is paid at 20% of the applicable per diem rate. The time spent travelling to the workplace named by the employer, and back, counts towards that duration.

According to the explanation given at the seminar of the State Tax Inspectorate (VMI) and the State Labour Inspectorate (VDI), leaving at 20:01 or later means the first day is paid at 20%. Returning to the workplace and/or home by 03:59 inclusive means the last day is also paid at 20%. If the day lasts exactly 4 hours, the rule does not apply.

The 20% is calculated from the rate that applies to the specific trip, including a lawfully set reduced rate. The employer cannot change this percentage at its own discretion.

For example, an employee leaves for Germany on Monday at 21:00 and returns on Wednesday at 18:00. The full daily rate of €62 applies. Monday: 62 × 20% = €12.40. Tuesday and Wednesday: €62 each. In total: 12.40 + 62 + 62 = €136.40.

From now on the accountant needs a clock as well: an entry saying “5–7 October” may not be enough for an exact calculation.

How far can per diems still be reduced?

Whether per diems can be reduced depends on the length of the trip and the document that sets them:

• If there is no collective agreement and the trip is shorter than 7 days, an internal document cannot reduce them – the full rate set by the Government applies.
• If there is no collective agreement and the trip lasts 7 days or longer, an internal document may set per diems at no less than 65% of the maximum rate.
• If reduced rates are set in a collective agreement, they may be no less than 50% of the maximum rate, whatever the length of the trip.

These limits apply when the daily rate is set. For a short first or last day, the 20% rule applies on top.

For example, a company has no collective agreement and the rate for Germany is €62. For a five-day trip, an internal policy cannot set a daily rate of €40.30. For an eight-day trip that rate is allowed, provided the reduction is properly documented: 62 × 65% = €40.30.

The old order saying “we pay everyone half” has been calling for a serious document review since October.

Inform the employee before departure

The employee must be informed of the reduced rates in writing before the trip begins. The rate set applies until the end of that specific trip.

If the route changes, and with it the country or city, the rate set for the new destination applies. Before an internal policy is approved, the applicable information and consultation procedures must be carried out.

Which country's rate applies?

On the day of departure, the rate of the country or city the employee is travelling to applies; on the day of return, the rate of the country or city they are returning from.

When an employee is sent to several countries, the days actually spent in each are counted from arrival in that country. If the employee travels to several countries on the same trip day, the average of their per diem rates applies, except for connecting flights and transit.

Changing planes at an airport does not in itself create a business trip in that country.

A trip that began in September 2026 and ended in October

According to the explanation given at the VMI and VDI seminar, the calculation is split by trip day: up to and including 30 September the old rules apply, from 1 October the new ones.

When assessing the 7-day threshold, the whole uninterrupted trip counts, including the September days. A trip from 28 September to 5 October lasts 8 days: the counter does not restart on 1 October.

Does the taxation of per diems change?

No. The October changes do not remove the usual checks on how per diems are taxed – the rules below are a reminder, not new thresholds from 1 October.

• In Lithuania the per diem rate is €28 per day. For the tax exemption, the limit of 50% of salary on per diems paid in a month also matters.
• For trips abroad in 2026, the relevant agreed monthly salary threshold is €1,902.45 (minimum monthly wage × 1.65) and the hourly threshold is €11.6325 (minimum hourly wage × 1.65). Once the relevant threshold is reached, per diems that meet the rates and other requirements are exempt from personal income tax (GPM).
• When the agreed pay is lower, the 50%-of-salary limit applies. The part of the per diems above it is taxed as income from employment.

For tax purposes, what matters is the amount of per diems actually paid in the month, so we check the payment date too. A correctly calculated amount does not yet answer every tax question: calculating per diems and checking their tax exemption have to go hand in hand.

What to do now

• Update your business trip policy: one-day trips within Lithuania, the 20% rule and the reduction limits.
• Review old reduced rates, especially those set only in internal documents.
• Record the time of departure and actual return, including the journey to the workplace or home.
• If you pay reduced per diems, inform the employee in writing before departure.
• Update your spreadsheets and accounting software settings, and check the September–October trips.
• Check the taxation and the amounts actually paid in the month separately.

We recommend reviewing your policy before you run October's payroll. If we do your payroll, write to us – we will go through your business trip policy and your October trips together.

The employee needs a ticket and a suitcase for the trip. The accountant needs dates, hours and an updated policy. The better everything is sorted before departure, the fewer surprises come back with the expense report.