Daily Allowance
What is Daily Allowance?
Daily Allowance, also known as per diem, is a financial stipend allocated to employees to cover day-to-day expenses while traveling for work. This allowance may vary based on factors such as destination, duration of travel, and company policy. Instead of reimbursing individual receipts, organizations often provide a lump sum amount to simplify expense tracking.
Corporate travel policies typically define the daily allowance based on government regulations or industry benchmarks. Companies may categorize allowances into meals, incidentals, and lodging, ensuring that employees have adequate coverage without excessive spending. By setting predefined limits, businesses can maintain budget control while offering flexibility to travelers.
Daily Allowance benefits both employees and employers by reducing administrative work associated with expense claims. It also enhances compliance with travel policies, minimizes out-of-pocket expenses for employees, and ensures transparency in corporate travel expenditures.