Per diem on a long-term assignment in Spain: what changes when the residence has a kitchen and a washing machine

Start with the assumption buried in your per diem rate

Most per diem structures for a long-term assignment in Spain are inherited from business-travel policy. They assume the employee eats every meal out, sends shirts to a hotel laundry, and has nowhere to store food beyond a minibar. That assumption is reasonable for four nights in a hotel. It is expensive and slightly absurd for four months in a furnished residence with a kitchen and a washer-dryer.

The practical point for an HR or Global Mobility manager is this: the accommodation type determines which per diem components are still doing work and which are simply cash. If you are placing someone in corporate housing for a multi-month posting, the meal allowance and the incidentals line should be reviewed before the assignment letter is issued, not after the first expense claim arrives.

The three cost lines a kitchen actually moves

A fully equipped kitchen does not eliminate food cost. It changes where the cost sits and how predictable it is.

Meals. An assignee cooking breakfast and most weekday dinners, and eating out at lunch and socially, will typically spend meaningfully less than someone on three restaurant meals a day — while still spending money. The realistic policy position is a reduced meal per diem for the residence portion of the assignment, not a removed one. In Málaga specifically, a menú del día at lunch remains one of the better-value working lunches in western Europe, so a policy that funds a daily lunch out and assumes self-catering otherwise usually maps well onto how people actually live.

Groceries versus receipts. Grocery shopping generates many small receipts, and many companies find the reconciliation burden outweighs the control benefit. A flat, reduced daily or weekly allowance for food, paid without receipts, is generally cleaner for a long-term assignment in Spain than a receipted grocery budget. Check with your tax adviser how that allowance is treated for Spanish payroll and for the employee's home-country tax position — the treatment of per diem paid to a posted worker depends on residence status, the length of the posting and the applicable double-tax treaty, and none of that should be assumed from a policy template.

Laundry and dry cleaning. This is the line most often left untouched and most often wasted. In-residence laundry removes hotel laundry charges entirely for everyday clothing. What remains is genuine dry cleaning for suits and outerwear, which is better handled as an occasional reimbursed expense than as a daily accrual.

Why the per diem question is really a housing question

The honest framing is that per diem for a long-term assignment in Spain cannot be set sensibly until the accommodation is chosen, because the accommodation decides what the allowance has to cover. A hotel rate with breakfast, a serviced apartment without laundry, and a furnished residence with both kitchen and washer-dryer produce three different allowance structures for the same employee doing the same job.

This is where the total-cost comparison usually resolves in favour of corporate housing on assignments beyond a few weeks. A hotel invoice looks simple, but it sits alongside a full meal per diem, laundry charges, and the soft cost of an employee with no private space to work or cook. A furnished residence carries a higher headline accommodation line and a materially lower everything-else line. At Palacete 10, each of the five residences includes a fully equipped kitchen, an in-unit washer and dryer, high-speed fibre internet and one secure parking space, so the components that would otherwise appear as variable expenses are already inside the accommodation agreement.

Building the policy: a short checklist

Before the assignee travels, confirm the following in writing:

• Which per diem components apply from day one, and which step down once the employee moves into the residence — useful if there is a hotel bridge period before the residence is available.
• The meal allowance basis — flat daily amount, working-day only, or reduced weekend rate — and whether it is receipted.
• A one-off settling-in amount for store-cupboard basics, cleaning products and anything the employee needs to start cooking. A furnished kitchen is equipped; it is not stocked.
• How utilities are handled. In corporate housing this is normally inside the accommodation agreement rather than the employee's expense claim, which removes a recurring reconciliation task. Confirm the mechanism in the contract rather than assuming it.
• Laundry treatment — everyday laundry absorbed by the residence, dry cleaning reimbursed on receipt.
• Transport. Walkability changes this line materially. Where the residence sits a minute from public transport and fifteen minutes' walk from the historic centre, a daily taxi assumption is usually redundant.
• Tax and social security treatment of the allowance, verified with your Spanish adviser for the specific posting length and worker status. Do not carry forward last year's assumption.

What finance gets out of it

The less visible benefit is invoice hygiene. A multi-month posting run through a hotel plus expense claims produces dozens of documents a month. Corporate housing contracted company to company produces one supplier, one contract and one monthly VAT-compliant (IVA) invoice. At Palacete 10 the agreement is made directly with the owner-operator, Vamoz Marbella SL, with utilities managed by the operator and a single accountable point of contact; a Spanish bank account is not required. Lease terms are agreed per contract, so the duration should be discussed alongside the per diem structure rather than after it.

If you want the specific inclusions to build into your allowance model, the residence inclusions and the leasing and invoicing questions set out what sits inside the agreement and what does not.

Request a corporate proposal.