Recovering VAT on travel expenses: 2026 rules and practical cases

Recovering VAT on travel expenses depends on the category: it is deductible on restaurant costs (business and solo meals, 10%) and fuel (80% on passenger vehicles, 100% on utility vehicles), but excluded on passenger transport (train, plane, taxi, ride-hailing) and on hotels for the company's directors and employees.

Every year, businesses leave thousands of euros of VAT on the table by not fully understanding the rules applicable to travel expenses. VAT recovery on these costs follows a clear logic: some categories allow full deduction, others are partially recoverable, and a few face explicit exclusions under the French Tax Code. This practical guide covers the 2026 rules from Article 206 of Annex II of the CGI (exclusions) and the BOFiP series BOI-TVA-DED-30-30 (lodging, vehicles, transport, petroleum products), with worked examples for each expense category.

The right to deduct VAT is governed by Article 271 of the CGI: a VAT-registered business can deduct VAT on goods and services used for its taxable operations. Professional travel expenses fall within this framework, subject to three cumulative conditions:

• Substantive condition: the expense must be incurred in the interest of the business (business travel, client prospecting, assignments, professional training)
• Formal condition: the company must hold a compliant invoice or equivalent document showing the VAT amount
• No legal exclusion: certain categories are expressly excluded by statute regardless of the professional purpose

The tax authority details these rules in the BOFiP series BOI-TVA-DED-30-30 (lodging, vehicles, transport, petroleum products), which lists the exclusions applying to each expense category.

Key point: the professional purpose of an expense is a necessary but not sufficient condition. A 100% professional expense can remain excluded from VAT deduction due to a specific legal exclusion (tourist vehicle, director accommodation, etc.).

Train and plane tickets: VAT not recoverable (passenger transport)#

Contrary to a common belief, domestic passenger transport (domestic trains and flights) is not exempt: it is subject to 10% VAT. But this VAT is not recoverable for the business, under the exclusion of the right to deduct passenger transport (Article 206 of Annex II CGI), not under an exemption. Only international passenger transport is exempt. Practical outcome: no VAT to recover on these tickets.

Practical implication: a Paris-Lyon train ticket costing €120 generates zero deductible VAT. The entire amount (including the non-recoverable 10% VAT) remains a cost for the business.

Taxis and ride-hailing: VAT not deductible#

Taxi journeys and ride-hailing services (Uber, Bolt, Kapten) fall under the reduced 10% rate applicable to passenger transport, not the standard 20% rate. More importantly, VAT on passenger transport is not deductible for the business, whatever the mode used (road, rail, air, water), even for a strictly professional trip (exclusion under Article 206, IV-2 of Annex II CGI; BOI-TVA-DED-30-30-30).

Worked example: a ride-hailing fare of €60 TTC generates no recoverable VAT. The full amount is a cost. Recovering this VAT would expose the business to a tax reassessment.

Important: even compliant, Uber or Bolt invoices do not make the VAT deductible. Narrow exceptions only: public passenger transport and permanent home-to-work staff transport contracts.

Public transport: VAT not recoverable#

Navigo passes, Metro, RER, tram and bus tickets also fall under passenger transport: the VAT (at 10%) is not deductible for the business. No recovery is possible on these expenses.

Professional hotels: VAT excluded for directors and employees#

Hotel nights are subject to 10% VAT (accommodation and breakfast). But VAT on the lodging of the company's own directors and employees is excluded from deduction (Article 206, IV-2-2° of Annex II CGI; BOI-TVA-DED-30-30-10), even for a fully justified business trip.

Worked example: a hotel night billed at €200 TTC for a director or employee does include €18.18 of VAT, but it is not recoverable (€0 deductible). The full €200 remains a cost.

The only deduction allowed: accommodation for third parties. Hotel VAT is deductible only when the night benefits a third party (client, supplier, prospect). On a mixed invoice (rooms for clients and for your own staff), an admission coefficient applies pro rata to the number of third parties (for example 3 client rooms out of 5: 3/5 of the VAT deductible). The same logic applies to an Airbnb or serviced apartment used by your own staff: VAT not deductible.

Airbnb and short-term rentals#

Short-term furnished rentals via platforms (Airbnb, Booking) may or may not be subject to VAT depending on the host's tax status. If the host is a non-taxable private individual, no VAT is charged and no recovery is possible. If the host is a VAT-registered professional (hotel, serviced apartment, tourist residence), 10% VAT applies, but it follows the same exclusion as a standard hotel: not deductible for the lodging of your directors and employees, deductible only for a third party.

Different rules depending on context#

VAT on catering expenses is subject to distinct rules depending on the nature of the meal.

Solo meals during a business trip

When an employee or director eats alone during a business trip, 10% VAT is in principle deductible if the expense is justified by the business activity.

Worked example: a lunch billed at €45 TTC includes €4.09 of VAT (45 / 1.10 × 0.10). VAT is recoverable if the supporting document clearly references the professional context.

Business entertainment meals with clients or partners

VAT on restaurant expenses is deductible provided the expense is incurred in the direct interest of the business, including business meals with clients, prospects or suppliers. Restaurant costs are not on the exclusion list of Article 206 of Annex II CGI (deductibility acquired since the former exclusion was repealed in 2001). You must justify the purpose and the identity of the participants (names on the back of the invoice or in the expense tool).

The rule to remember: VAT on a business meal (at 10%, 20% on alcohol) is recoverable, like that of a solo meal during a trip, subject to a compliant supporting document and the professional purpose.

The simplified receipt threshold#

Below €150 HT, a simplified cash receipt is sufficient as a supporting document. Above this threshold, a full invoice with VAT details is mandatory to exercise the right to deduction.

Utility vehicles: fuel VAT fully deductible#

For utility vehicles (vans, light commercial vehicles), VAT on fuel (diesel, unleaded petrol) is 100% deductible, provided the vehicle is used exclusively for professional purposes and the invoice is in the company's name.

Tourist/passenger vehicles: the exclusion in principle#

Tourist (passenger) vehicles are excluded from the right to deduct VAT on their acquisition, rental (leasing, long-term or short-term hire) and maintenance (Article 206, IV-2 of Annex II CGI), even if the vehicle is used exclusively for professional purposes. Fuel follows a separate regime (Article 298, 4-1° CGI): VAT on petrol and diesel is 80% deductible on a passenger vehicle, and 100% on a utility vehicle used exclusively for the business. GPL, GNV and recharging electricity are 100% deductible on all vehicles.

In 2026, the VAT deductibility rates on fuel by vehicle type and fuel type are as follows:

Special case : vehicle rental: VAT on tourist vehicle rental (leasing, long-term hire, short-term rental) is also excluded from deduction, on the same basis as acquisition.

Absolute exclusions : no condition allows recovery:

• VAT on passenger transport (train, plane, taxi, ride-hailing, bus, metro): excluded from deduction, whatever the mode
• VAT on the lodging of directors and employees of the business (deductible only for accommodation of third parties)
• VAT on petrol and diesel of passenger vehicles for the fraction above 80%
• VAT on the acquisition and maintenance of tourist/passenger vehicles
• VAT on tourist vehicle rental (leasing, long-term hire)
• VAT on short-term rentals (Airbnb, serviced apartments) used by the directors and employees of the business

Conditional exclusions : recovery possible under conditions:

• VAT on accommodation of third parties (clients, suppliers): deductible; on a mixed invoice, pro rata to the number of third parties
• VAT on petrol and diesel of a passenger vehicle: deductible at 80% (100% for GPL, GNV or electricity)
• VAT on solo meals during travel: deductible with adequate documentation and no external guest

To decide quickly, here is the VAT treatment of each travel expense category in 2026, with its legal basis.

Supporting document required in all cases: an invoice in the company's name showing the VAT (a simplified receipt is accepted up to €150 excl. VAT). Without a VAT mention, no deduction is possible.

Essential supporting documents#

To exercise the right to deduct VAT on travel expenses, the company must retain:

• Original invoices (paper or electronic) showing: supplier name, VAT number, HT amount, VAT rate, TTC amount, date and description of the service
• Link to professional activity: mission orders, meeting notes, client correspondence, professional diary
• For mileage expenses: logbook (date, route, distance, professional reason, vehicle used)

The tax authority can exercise its audit right for 3 years from the date the relevant VAT return was filed.

Accounting entries by category#

Travel expense : train €120 (no VAT):

• Debit 625100 : Travel expenses: €120.00
• Credit 401000 : Suppliers: €120.00

Accommodation for a client (third party) €200 TTC (10% VAT, deductible):

• Debit 625700 - Accommodation: €181.82
• Debit 445660 - Deductible VAT: €18.18
• Credit 401000 - Suppliers: €200.00

Hotel for a director or employee €200 TTC (10% VAT, excluded):

• Debit 625700 - Accommodation: €200.00
• Credit 401000 - Suppliers: €200.00
• (No deductible VAT: own staff lodging excluded)

Expense : solo meal on business trip €45 TTC (10% VAT):

• Debit 625100 : Meals on travel: €40.91
• Debit 445660 : Deductible VAT: €4.09
• Credit 401000 : Suppliers: €45.00

Client business meal €120 TTC (10% VAT, deductible):

• Debit 625600 - Entertainment expenses: €109.09
• Debit 445660 - Deductible VAT: €10.91
• Credit 401000 - Suppliers: €120.00
• (Recoverable VAT: justify the purpose and participants)

The expense report: a document to formalise#

The expense report is the internal document that consolidates and justifies employee or director expenditure. It must show: the date, nature of the expense, TTC amount, recoverable VAT amount, professional reason, and supervisor signature. In the event of a VAT audit, the absence of formalised expense reports can lead to the rejection of deductions.

Practical advice: use an expense management tool (Expensify, Jenji, Spendesk) that archives digital receipts and automatically calculates recoverable VAT by category.

VAT recovery on travel expenses is a concrete opportunity for any business whose employees travel regularly. The rules are precise but well-defined: Article 206 of Annex II CGI and the BOFiP series BOI-TVA-DED-30-30 set the framework.

Key takeaways for 2026:

• Train, plane, taxi, ride-hailing, bus, metro: passenger transport, VAT not deductible (10%, never recoverable)
• Hotel for directors and employees: 10% VAT excluded; deductible only for third-party accommodation
• Solo meal on travel: 10% VAT recoverable with documentation
• Client business meals: 10% VAT recoverable (purpose and participants justified)
• Tourist vehicle: acquisition, rental and maintenance excluded; fuel (petrol and diesel) 80% deductible
• Utility vehicle: VAT on fuel and maintenance 100% deductible