Per diem rates in the UK: a brief guide (2024)
International per diem rates
How per diem rates for foreign travel are established in the UK
- £5 for trips for 5 hours or more.
- £10 for trips for 10 hours or more.
- £25 for trips for 15 hours or more and ongoing at 8 pm.
- Additional £10 if travel is ongoing at 8 pm on a trip of 5 or 10 hours.
Country
City
5+ hours
10+ hours
24-hour rate
Room rate
USA
New York
$31.00
$76.50
$102.50
$216.00
France
Paris
€40.00
€86.50
€117.00
€199.50
Germany
Berlin
€22.00
€65.50
€72.00
€167.50
Japan
Tokyo
¥4,445.50
¥10,534.50
¥11,290.50
¥18,381.50
Australia
Sydney
AU$57.50
AU$147.50
AU$195.00
AU$227.00
China
Shanghai
¥232.00
¥563.00
¥605.50
¥1,328.50
What’s covered under per diem rates?
- Corporate credit cards: Many companies provide corporate credit cards for employees to use for business travel expenses. These charges are then reviewed and approved separately from per diem claims.
- Direct billing: Some organisations have arrangements with hotels or travel agencies where the company is billed directly for accommodation and major travel expenses.
- Travel management systems: Companies often use specialised travel management platforms like TravelPerk where employees can book travel and accommodation. These systems track expenses separately from per diems.
- Mileage claims: For fuel expenses when using personal vehicles, employees typically submit mileage claims using HMRC-approved mileage rates.
- Pre-paid bookings: In some cases, the company may pre-book and pre-pay for accommodation and travel, so the employee doesn't need to claim these expenses at all.
- Reimbursement through payroll: Some organisations process larger travel expenses like accommodation through the payroll system rather than the standard expense claim process.
How are international per diem rates taxed?
- Employees won’t owe income tax on these payments.
- Employers won’t need to make National Insurance contributions on them.
Set your custom HMRC-compliant foreign per diem rates
- Visit the official HMRC website.
- Look for the section related to employer expenses and benefits or scale rate payments.
- Accessing the form through this general link for HMRC forms:
- State the rate you wish to pay
- Prove that the amount is a reasonable estimate of actual expenses incurred by employees. You can do this with a sampling exercise. This involves randomly selecting about 10% of eligible employees and tracking their expenses for one month. The data from this sample must provide a clear and reasonable estimate of the typical expenses incurred during business travel.
- Show that you have a checking system in place to ensure payments are only made when employees are entitled to them and have actually incurred the expenses.
International per diem rates and corporate travel for UK businesses
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