Per diem is a Latin word meaning “per day”. It is used to refer to the payment of daily expenses incurred by an employee during the course of their work. Paying a per diem is typically a way employers reimburse employees or agents of the company for travel and other expenses while on duty.
Description
Per diem is a payment made for expenses such as travel, lodging and food. Employers typically pay traveling employees a set amount of per diem per each day they travel for work purposes. This amount is intended to cover expenses incurred from work travel. Companies assess average costs, sometimes city by city, for business-related travel and establish per diem rates accordingly.
Details
Per diem is not a taxable amount. Some employers write a separate check for per diem expenses to employees. Other employers include the amount on the employee’s regular paycheck. The amount is listed on the paystub as per diem. It is calculated by multiplying the per diem amount by the number of days for which the employee earned it.
Features
Employees receiving a per diem amount included on their paystub see all normal items listed including income and deductions. The per diem is calculated, listed on the paystub and employees receive a paycheck that includes their earnings as well as their per diem payment.
References
- U.S. Legal: Per Diem Law and Legal Definition
- Dictionary: Per Diem
- U.S. General Services Administration. "Frequently Asked Questions, Per Diem." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "Federal Travel Regulation, Section 300-3.1," Pages 22 and 71. Accessed Nov. 25, 2019.
- U.S. General Services Administration. "M&IE Breakdown." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for Georgia." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for Illinois." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "Factors Influencing Lodging Rates." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for New York." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Highlights." Accessed Nov. 25, 2019.
- Internal Revenue Service. "Notice 2019-55," Page 3. Accessed Nov. 25, 2019.
- Internal Revenue Service. "Per Diem Payments Frequently Asked Questions," Page 2. Accessed Nov. 25, 2019.
- Internal Revenue Service. "Topic No. 511 Business Travel Expenses." Accessed Nov. 25, 2019.
Writer Bio
Jennifer VanBaren started her professional online writing career in 2010. She taught college-level accounting, math and business classes for five years. Her writing highlights include publishing articles about music, business, gardening and home organization. She holds a Bachelor of Science in accounting and finance from St. Joseph's College in Rensselaer, Ind.