When employees travel for business, they’re likely to spend on lodging, meals, and incidental expenses. Typically, companies validate, approve, and reimburse these expenses when employees submit expense claim reports. These reports are per diem expense reports.A per diem expense report helps companies map business trip expenses to daily allowances or per diem. This article covers how your HR or finance team can create per diem reports, and streamline per diem reporting for employees.

A per diem—or scale rate payment—is a tax-free daily allowance that covers expenses for employees traveling on business. Companies offer per diem allowances to ensure employees aren’t paying out-of-pocket for expenses incurred as a result of business engagements—such as lodging rates, transportation, food, and any other incidental expenses.Per diem amounts are fixed. It covers actual expenses for:The

General Services Administration (GSA)

sets the per diem rates in the continental United States (CONUS), including Alaska but not Hawaii. Employers can either opt for the federal government’s

standard rates

or the high-low method.The high-low method sets a higher per diem rate for high-cost locations and lower for areas that are deemed less expensive. Examples of high-cost areas include New York City, Chicago, San Francisco, and Seattle. Locations that aren’t high-cost are automatically considered low-cost.Companies running operations in the UK follow per diem rates set by

HM Revenue and Customs (HMRC)

to create travel allowances, per diem policies, and rules. You can either follow the HMRC benchmark rates or agree on a rate based on previous expense patterns.Find out more about per diem allowances when traveling throughout the US and the UK by checking out our comprehensive

per diem guide

. For per diem allowances when travelling abroad, head over to our

guide on internationial per diem rates

.

There’s an art to creating expense reports—and per diem reports are no different. Companies typically ask employees for receipts to record, approve, and reimburse employee travel expenses. Comprehensive record-keeping is essential for ensuring per diems reach employees quickly, and without any tax implications.If you’re managing per diem expense reports with manual forms, you want to make sure to add the following.Employees need to file claims within

60 days

from the last day of travel to ensure reimbursement. Businesses usually don’t look for explanations for any business travel expenses but ask for expense receipts to comply with IRS regulations.

Traveling employees are eligible for the per diem sum every 24 hours they spend away on business. When employees go on multi-day business trips, they’ll need to file claims for lodging, meals, and incidental expenses (also known as M&IE).Once your employees submit forms, the finance team spends hours verifying business expenses against reimbursement rates and processing payments manually. Manual per diem reporting wastes valuable time for both the traveling employee and the finance team—but it doesn’t need to.More businesses are opting for automated

expense management software

to streamline per diem expense reporting and reimbursement. It speeds up reporting, per diem management, and reimbursement—ensuring your employees save time and receive prompt reimbursement. Make sure you look out for:These software solutions often also help you book travel, track traveling employees, streamline travel policies, and manage corporate travel reporting of all kinds.One such tool is TravelPerk—the all-in-one travel management solution trusted by companies big and small. Its

ample expense management integrations

enable you to seamlessly manage per diem expenses and reporting without the hassle of back-and-forth email chains and endless paperwork.Per diem reporting doesn’t need to be confusing—ensure your team can focus on performing their roles to the best of their abilities by swiftly handling any and all per diem reimbursements.