How is Per Diem Calculated?
Per Diem is an allowance or payment made for each day of travel, usually for business travel. To calculate your Per Diem you need a few pieces of information:
- When you are traveling,
- Where you are traveling, and
- How long your trip is.
There are a few edge cases we will cover at the end including the use of Government Meals Rates (GMR), Proportional Meals Rates (PMR), and Flat-Rate rules.
The General Service Administration (GSA) sets Per Diem rates for travel destinations within the Continental United States, usually abbreviated as CONUS. The GSA Per Diem rates are the official rates used by the IRS and the Federal Government. Many state and local governments and private companies use the GSA rates as well. The Department of State (DoS) sets the Per Diem rates for travel outside of the Continental United States (OCONUS),
The GSA/IRS Per Diem rates are based on the county to which you are traveling. There are over 3,000 counties in the lower 48 states. The Dept. of States sets Per Diem rates based on city or region. In some cases there is only one rate for an entire country.
Per Diem rates also vary based on the time of year. Particularly in regions where there is tourism, Per Diem rates rise during peak season. You can use the dropdown navigation tool to look up any travel destination.
First and Last Day Travel Rules
On the first and last days of travel you only receive 75% of you ME&I Per Diem. This is because you will not be traveling the entire day and thus are not entailed to a full day's worth of Per Diem. 75% is a generous approximation. In 2014, the First and Last day percentage was raised from 55% to 75%.
You receive full Lodging Per Diem for each night you spend away from home.
Government Meals Rates and Proportional Meals Rates
M&IE is a combination of Meals and Incidental Expenses. Incidentals are always $5. You full mean rate is based on your travel destination.
Military personnel traveling to a location where government dining facilities are available (mess hall) may only receive the Government Meals Rate (GMR). This rate is substantially lower than the regular meals rate and covers only the exact cost of eating breakfast, lunch, and dinner in the government dining facility.
Proportional Meals Rate (PMR) is used when one or two meals are given at no cost to the traveler (ex. a conference your employer is paying for that includes lunch). Also, if a military personnel has access to one or two meals in a government dining facility then they will be given the Proportional Meals Rate.
Proportional Meals Rate is calculated by averaging the standard meals rate and the government meals rate. The standard meals rate changes based on your travel destination but the government meals rate only changes year-to-year - not based on location.
Flat Rate Per Diem
In an effort to encourage travelers to cut costs and to simplify the Per Diem calculation for extended trip (30-days or longer) your employer may issue a "Flat-Rate" Per Diem. Flat-Rate rules are used by the federal government. Flat Rate Per Diem rules dictate that any trip laster longer than 30-days will be paid at a rate of 75% the full amount and trips lasting longer than 180-days will be paid at a rate of 55%. The goal is to encourage travelers to take advantage cost saving opportunities available through booking extended stays.
The Flat Rates are marginalized. This means that regardless of how long your trip is, you will receive the full per diem amount for the first 30 days. For days 31 to 180 you will receive the reduced amount and for day 181 and later you will receive the further reduced rate.