What is a per diem?
A per diem is a fixed daily allowance for business travel — meals, lodging, incidentals — paid instead of reimbursing actual receipts. The US government publishes standard rates by city; many companies adopt them. It's simpler than expense reports and caps travel spending automatically.
In practice
A consultant travels to Chicago where the meal per diem is $79. She spends $52 on food and keeps the difference — that's the deal with per diems.
Invoice travel cleanly
Per diems and travel days as clear invoice line items.
Create an invoice — freeFrequently asked questions
Who sets per diem rates?
The GSA publishes US federal rates by locality; companies often adopt them or set their own. International trips use State Department rates.
Is per diem taxable income?
If it doesn't exceed the federal rate and you account for the travel, generally no. Excess amounts can be taxable wages — check with your accountant.
Per diem vs. actual expense reimbursement?
Per diem is simpler and predictable; actuals are fairer when costs vary wildly. For client-billable travel, use whatever the contract specifies.