If you travel for your job, you’re usually not expected to cover the cost yourself. So, book yourself at the Hilton, right? Order room service, live it up since they’re paying? Sadly, you’ve got it all wrong if this is what you’re imagining for business travel. Unless the company you work for is very very profitable, they’re going to reign in your business travel expenses and give you a budget. Usually you get per diem.
What is Per Diem?
Per diem is latin for “for the day”. That means you get so much money for each day of travel. It’s a rate set by the federal government (the US General Services Administration (GSA), to be exact). The per diem rate is different, depending on where you’re traveling. A hotel in downtown San Francisco will require more cash than a roadside motel in rural Kansas.
To help businesses figure out what to allow for their business travelers, the GSA runs a website with a lookup function for every state, every city in the US. Employers, accountants and travelers simply look up the per diem for the business destination and everyone works from that number.
Per diem covers lodging, meals, and incidental expenses like cab fare, dry cleaning, things like that. Per diem is usually broken up into two dollar amounts: the lodging part and the M&IE part (Meals & Incidental Expenses).
If you need to submit your travel expenses to your company, check the GSA website’s per diem page here. Find your city’s rates, multiply by days traveled and you’ve got an expense report.