Please be aware that this resource is informational only, and many external factors, unique to your company might apply.
Each company must make their own decisions about how they meet their tax obligations.

Table of contents

Table of contents

Daily Allowance (Per diem)

If you provide exempt scale rate payments to your employees for their subsistence expenses, you do not need to report these per diems to the HMRC or pay taxes on them.

Exempt scale rates must only be used where all the qualifying conditions are met.

  • the travel must be in the performance of an employee’s duties or to a temporary place of work
  • the employee should be absent from their normal place of work or home for a continuous period in excess of 5 hours or 10 hours
  • the employee should have incurred a cost on a meal (food and drink) after starting the journey
  • An employee can only be reimbursed for a meal once. Therefore if the cost of an evening meal or breakfast is reimbursed on an actual basis because it is included in the cost of an overnight stay, the employee would not be entitled to the benchmark rate for breakfast or late evening meal as well.

To recap, exempt scale rate payments are approved bespoke amounts agreed with the HMRC, or payments that are made in accordance with HMRC’s benchmark scale rates. We’ll be discussing the latter below.

The current benchmark rates for domestic travel in the UK are:

Rate Rate Conditions
a) £5 Qualifying travel of 5 hours or more
b) £10 Qualifying travel of 10 hours or more
c) £25 Qualifying travel of 15 hours (and ongoing at 8 pm)


Notes on Domestic Per Diems:

  • An additional meal allowance of up to £10 per day may be paid if an allowance under a) or b) is paid and travel is ongoing at 8 pm.
  • No benchmark rate has been set for overnight accommodation
  • The over 15-hour rate will almost always apply when an employee is required to stay overnight and provided that the cost of any meal is not included as part of the accommodation

Overseas Scale Rates

For travel abroad, HMRC’s Worldwide Subsistence rates will apply per city:

If your employee is travelling to a place not shown in the table, you can reimburse your employees using the rates for the closest city shown for the country that they have travelled to.

Unlike domestic rates, overseas scale rates also include:

  • a 24-hour rate, comprising of breakfast, lunch, dinner, other, drinks, and hotel to office allocations
  • a supplement room rate for overnight stays

Here’s an example of the scale rate for a business trip to Abu Dhabi:

Abu Dhabi, UAE Rate (in dirham)
Over 5 hours 98
Over 10 hours 242.50
24-hour rate 373.50 (total residual) + 637 (room rate)
Room rate 637


Subsistence Type Amount
Breakfast 85.50
Lunch 82
Dinner 128.50
Other 15.00
Drinks 32.00
Hotel to Office 30.50
Total Residual 373.50

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