tmcmatchPer diem in the UK: the HMRC rates behind a tax-free daily travel allowance
Many countries have one government per diem. The UK does not. A daily allowance paid to a travelling employee can be tax-free, but only if each part of it rests on a specific HMRC rule: benchmark meal rates for UK journeys, a small nightly limit for incidentals, scale rates for 284 overseas cities, or a rate HMRC has approved for your organisation. Anything paid outside those is taxable earnings. This page lays the parts side by side and works through two trips.
Key points
- No single UK per diem. Five separate rules make one up.
- UK meals: £5 / £10 / £25, plus a £10 late supplement.
- Overnight incidentals: £5 a night in the UK, £10 abroad — and exceeding it makes the whole amount taxable.
- Abroad: HMRC scale rates by city, in local currency, from a table dated 26 March 2020.
- Your own rate needs HMRC approval, for up to 5 years.
What a UK per diem is made of
| Part | HMRC rule | Amount | Catch |
|---|---|---|---|
| Meals on a UK business journey | HMRC benchmark rates (SI 2015/1948) | £5 (5h) / £10 (10h) / £25 (15h and after 8pm); £10 late supplement | No receipts needed at or below the rate |
| Small personal costs on a night away (laundry, calls, newspapers) | Incidental overnight expenses (ITEPA s.240–241) | £5 a night in the UK, £10 a night abroad | Go over, and the whole amount is taxable |
| Meals and incidentals abroad | HMRC overseas scale rates | By city: 284 cities, local currency | Table dated 26 March 2020 |
| Hotel abroad | Overseas room rate, or actual cost | By city | Room rate is a benchmark, not a cap |
| Hotel in the UK | Actual cost | No HMRC flat rate | Receipts |
| Your own daily rate | Bespoke rate approved by HMRC (s.289B) | Whatever HMRC approves | Up to 5 years |
| A flat daily allowance outside all of the above | None | — | Taxable earnings |
The word “per diem” bundles things HMRC keeps apart. The GOV.UK pages quoted here talk about benchmark rates, scale rate payments, subsistence and incidental expenses — and each has its own conditions. A policy that pays one daily figure has to show how that figure maps onto these rules, or it is simply taxable pay.
1. Meals on UK journeys: the benchmark rates
The Income Tax (Approved Expenses) Regulations 2015 set the amounts an employer can pay for meals on qualifying business travel without receipts:
| Qualifying travel in the day | Maximum |
|---|---|
| 5 hours or more | £5 |
| 10 hours or more | £10 |
| 15 hours or more, and ongoing at 8pm | £25 |
| Supplement: a 5- or 10-hour allowance is paid and travel is ongoing at 8pm | £10 |
The rules on what counts as qualifying travel — and the 24-month limit on temporary workplaces — are on travel expenses and tax.
2. The overnight incidentals limit
No liability to income tax arises in respect of a sum if or to the extent that it is paid wholly and exclusively for the purpose of paying or reimbursing expenses which— a are incidental to the employee’s absence from the place where the employee normally livesRead it on legislation.gov.uk
The limit is per trip, not per night in isolation:
£5 for each night during the period spent wholly in the United Kingdom, and b £10 for each night during the period spent wholly or partly outside the United Kingdom.Read it on legislation.gov.uk
And it is a cliff: “Section 240(1) and (2) do not apply if the exemption provisions total in respect of the qualifying period in question exceeds the permitted amount.” An employer that pays £6 a night for a two-night UK trip does not get £10 tax-free and £2 taxable; it gets £12 taxable.
3. Overseas: HMRC scale rates by city
GOV.UK: “You can reimburse subsistence to employees by making a scale rate payment using the rates below.” If you do not use them, the choices are to “apply for a bespoke rate from HMRC and include the payments in a P11D form pay or reimburse your employees actual vouched expenses”. For places not on the list: “If your employee is travelling to a place not shown in the table of overseas scale rates you can pay or reimburse your employees using the rates for the closest city shown for the country that they have travelled to.”
| City | Over 5 hours | Over 10 hours | 24 hours | Room | Currency |
|---|---|---|---|---|---|
| New York, United States of America | 31 | 76.50 | 102.50 plus room rate | 216 | US dollars |
| Paris, France | 40 | 86.50 | 117 plus room rate | 199.50 | euros |
| Singapore, Singapore | 91.50 | 206.50 | 218 plus room rate | 318 | Singapore dollars |
| Tokyo, Japan | 4,445.50 | 10,534.50 | 11,290.50 plus room rate | 18,381.50 | Japanese yen |
All 284 cities are on HMRC overseas subsistence rates, with the date of the table and the rules on using it.
4. Your own rate: bespoke approval
An employer that wants its own daily figure can apply to HMRC. The test is in the Act:
An officer of Revenue and Customs may give the approval if satisfied that any calculation of a payment or reimbursement of expenses in accordance with the proposed rate, or such other rate as is agreed between the applicant and the officer, would be a reasonable estimate of the amount of expenses actually incurred.Read it on legislation.gov.uk
The approval runs to a fixed end date, “that day not being later than the end of the period of 5 years beginning with the day on which the approval takes effect”. GOV.UK adds that you only need to apply if you want bespoke rates — HMRC’s benchmark rates need no application.
Two trips, worked through
A long day trip in the UK
A day trip of 11 hours that is still going at 8pm: the 10-hour benchmark plus the late supplement.
| 10 hours or more | £10 |
|---|---|
| Late supplement (travel ongoing at 8pm) | £10 |
| Total | £20.00 |
Two nights away in the UK
The incidentals limit for the trip is two nights at £5: £10.00 in total. The hotel is paid at cost. How the meal benchmark applies on the days of an overnight trip is set out in HMRC’s guidance on the regulations, which we have not reproduced here; paying meals at actual cost avoids the question.
Three nights in Paris
| 24-hour rate × 3 (117 plus room rate) | €351.00 |
|---|---|
| Room rate × 3 (199.50) | €598.50 |
| Scale-rate total | €949.50 |
| Incidentals: three nights at £10 | £30.00 |
The scale rates are benchmarks. HMRC’s manual: “Employers are not bound to use the overseas room rate.” An employer can book the hotel directly and pay only the subsistence rates, and actual receipted costs can always be reimbursed instead.
We are paid a fixed fee per enquiry, agreed in advance, identical whichever supplier receives it. Per diems are here because the hotel — usually the largest part of a daily cost — is the part HMRC’s UK rates do not cover, and it is the part a travel supplier books.
Want hotels paid centrally so the per diem only covers meals?
Describe the requirement once. It goes to no more than three suppliers, once each.
Writing a per diem into policy
- Name the rule behind each part: benchmark meal rate, incidentals limit, overseas scale rate, or approved rate.
- Pay UK hotels at cost, or book them centrally.
- Keep incidentals within £5/£10 a night for the trip as a whole.
- Check claims: “Your employees cannot check their own expenses.”
A ready-made set of clauses is on expenses policy template. Whether per diems have to be reported is on P11D and business travel. This page applies legislation and HMRC guidance as read on 2026-09-28; it is not tax advice.
Common questions
What is the per diem rate in the UK?
The UK has no single per diem. HMRC’s benchmark meal rates for UK business journeys are £5 for 5 hours, £10 for 10 hours and £25 for 15 hours when the journey is still going at 8pm. Overnight incidentals are tax-free up to £5 a night in the UK. Accommodation is paid at cost.
What is the HMRC per diem for overseas travel?
HMRC publishes scale rates for 284 cities, in local currency. GOV.UK: “You can reimburse subsistence to employees by making a scale rate payment using the rates below.” For Paris, for example, the 24-hour rate is 117 plus room rate and the room rate 199.50 (euros).
Is a per diem taxable in the UK?
Not if it is paid at HMRC’s benchmark or scale rates for qualifying business travel, or at a bespoke rate HMRC has approved. A flat daily allowance paid on any other basis is taxable earnings.
What is the £5 overnight allowance?
The incidental overnight expenses exemption in ITEPA 2003 s.240–241: up to £5 for each night wholly in the UK and £10 for each night partly or wholly abroad, for small personal costs. If the total for the trip exceeds that, the whole amount is taxable: “Section 240(1) and (2) do not apply if the exemption provisions total in respect of the qualifying period in question exceeds the permitted amount.”
Do employees need receipts for per diem payments?
Not at or below HMRC’s benchmark or scale rates, but the employer must be able to show the travel qualified and must check the payments; employees cannot check their own expenses.
Can an employer set its own per diem rate?
Yes, with HMRC approval. HMRC approves a bespoke rate if it would be “a reasonable estimate of the amount of expenses actually incurred”, for up to 5 years.
Sources cited on this page
- Income Tax (Approved Expenses) Regulations 2015 (SI 2015/1948)
- ITEPA 2003, s.240 — Incidental overnight expenses
- ITEPA 2003, s.241 — Overall exemption limit
- GOV.UK — Expenses rates for employees travelling outside the UK
- ITEPA 2003, s.289B — Approval of flat rates
- GOV.UK — Expenses and benefits for employers
Every figure above was read from the source it is attributed to on 20 September 2026. How we check this.
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