VAT on Travel Expenses Ireland: What You Can and Cannot Reclaim
Not all travel expenses are equal when it comes to VAT. You can reclaim VAT on fuel for company vehicles, tolls, and some parking. You cannot reclaim VAT on mileage allowances, food, drink, accommodation, or entertainment — even when they're genuine business costs. Here's the full breakdown with worked examples.
This article covers VAT recovery only. For which travel expenses reduce your income tax or corporation tax bill, see our Tax-Deductible Travel Expenses guide.
Quick Reference: Can You Reclaim VAT?
| Travel Expense | VAT Reclaimable? | Notes |
|---|---|---|
| Fuel — company vehicle | Yes | Business proportion only. Need VAT invoices. |
| Tolls | Yes | VAT at 23%. Toll receipts show VAT. |
| Parking | Depends | Only if provider is VAT registered and issues a VAT invoice. |
| Mileage allowances | No | Flat allowance, not a cost with a VAT invoice. |
| Food & drink | No | Specifically excluded. Section 60(2) VATCA 2010. |
| Accommodation / hotels | No | Specifically excluded. Even for business stays. |
| Public transport | N/A | Zero-rated or exempt — no VAT charged. |
| Car hire (passenger) | No | Passenger vehicle hire excluded. Van hire IS reclaimable. |
| Entertainment | No | Specifically excluded. No exceptions. |
Mileage Allowances: No VAT to Reclaim
When you reimburse an employee at civil service mileage rates (e.g., €0.5182/km), you are paying a flat allowance. You're not reimbursing a specific cost backed by a VAT invoice — you're paying a rate per kilometre that covers the employee's fuel, insurance, wear and tear, and everything else.
Since there is no VAT invoice, there is no input VAT to reclaim. The employee bought fuel at a garage using their own money — they received a VAT receipt, but they are not a VAT-registered business making taxable supplies, so they can't reclaim it either.
Bottom line: Mileage reimbursements at civil service rates are tax-free for the employee and deductible for the employer — but there is zero VAT recovery on either side. This is one of the trade-offs of using the simple flat-rate system. For current mileage rates, see our Civil Service Mileage Rates guide.
Company Vehicle Fuel: VAT Reclaimable
If your business owns or leases a vehicle and pays for fuel directly (company fuel card, company credit card), you can reclaim the VAT on the business proportion of fuel costs. You need valid VAT invoices (fuel receipts showing the supplier's VAT number).
Worked Example: Company Van Fuel
Tolls and Parking
Tolls — VAT reclaimable
Irish motorway tolls include VAT at 23%. Toll receipts (including e-toll statements) show the VAT amount. You can reclaim VAT on business journey tolls.
Example: M50 e-toll monthly statement shows €48.00 incl. VAT. VAT content: €48 ÷ 1.23 × 0.23 = €8.98 reclaimable.
Parking — check first
VAT on parking is reclaimable only if the parking provider is VAT registered and issues a VAT invoice. Many multi-storey car parks and airport parking operators are VAT registered. On-street meter parking often is not.
Tip: Check the parking receipt for a VAT number. If it's there, you can reclaim. If not, no reclaim — even if VAT was technically included in the price.
Food, Accommodation & Entertainment: No VAT Reclaim
Irish VAT law specifically excludes these categories from input VAT recovery, regardless of business purpose. This catches many business owners by surprise.
Restaurant meals, takeaway, hotel breakfast, coffee — all excluded. Even a working lunch with a client. Section 60(2) VATCA 2010.
Hotel rooms, B&Bs, Airbnb — all excluded from VAT recovery. The VAT (currently 9% for tourism/hospitality) is a pure cost to the business.
Client entertainment, event tickets, hospitality — all excluded. No exceptions, regardless of the business purpose.
Important distinction: These expenses are still deductible for income tax / corporation tax purposes (if they're legitimate business expenses). You just can't recover the VAT. The cost including VAT is your tax-deductible expense.
Public Transport
Most public transport in Ireland is either zero-rated or exempt for VAT:
Since no VAT is charged on these fares, there is nothing to reclaim. The full fare is a tax-deductible business expense.
How to Reclaim: VAT 3 Return via ROS
Reclaimable VAT on travel expenses is included in your regular VAT 3 return, filed bimonthly through ROS.
Collect VAT invoices
Keep all fuel receipts, toll statements, and parking invoices with VAT details
Calculate input VAT
Total the reclaimable VAT, applying business-use percentages where needed
Include in VAT 3
Add to the T2 (input VAT) box on your bimonthly VAT return via ROS
VAT filing periods
Returns due by the 19th of the month following the period end. Late filing attracts interest.
Frequently Asked Questions
Related Resources
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