How are Expenses and Per Diems managed in the United Kingdom (UK)?

When employees travel for business purposes, they are entitled to claim certain expenses and per diems to cover their costs. These claims must comply with HM Revenue & Customs (HMRC) guidelines to ensure accuracy and transparency.


Expense Claims

  • Receipts:
    HMRC requires that all receipts submitted for expense claims are clear, complete, and accurate. Each receipt must include:

    • The supplier's name and address
    • The date of the transaction
    • A description of the goods or services provided
    • The total amount paid

  • Ensuring that all receipts meet these criteria is essential for a smooth expense claim process.

  • Mileage Claims:
    Employees who use their own vehicles for business travel can claim mileage expenses. HMRC provides approved mileage rates depending on the type of vehicle used. Employees should maintain a detailed mileage log, recording each journey's date, purpose, start and end locations, and the total miles traveled. This log is crucial for substantiating mileage claims.


Per Diems and Business Travel Rates

  • Per Diems:
    For employees traveling outside the UK, specific per diem rates apply. These rates vary based on the destination country and are intended to cover daily expenses such as meals, lodging, and incidental costs. Employees should refer to the HMRC's guidelines on per diem rates for international travel to ensure they claim the correct amount.

  • Meal Allowances:
    Meal allowances for business travel within the UK are based on the length of the journey. The following rates apply:

    • 5 hours: £5
    • 10 hours: £10
    • 15 hours (and ongoing at 8pm): £25

  • These allowances are designed to cover the cost of meals during extended business trips and should be claimed accordingly.

  • Vendor Information:
    Horizons does not require vendor information to be included on receipts submitted for expense claims. However, all other details must be accurate and comply with HMRC requirements.


Best Practices for Expense Claims

To ensure smooth processing of expense claims:

  • Always collect and store receipts that meet HMRC's requirements.
  • Maintain accurate logs for mileage and any other travel-related expenses.
  • Familiarize yourself with the applicable per diem rates, especially for international travel.
  • Submit claims promptly to avoid any delays in reimbursement.


Summary

When claiming expenses and per diems for business travel in the UK, employees must adhere to HMRC's guidelines. This includes providing detailed receipts, maintaining accurate mileage logs, and using the correct per diem rates for both domestic and international travel. By following these best practices, employees can ensure their expense claims are processed efficiently and in compliance with UK regulations.


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