Per Diem Definition

Term Definition
Per Diem refers to the daily stipend an employee receives to cover travel expenses in addition to salary and wages.

Extended Definition
An employee’s per diem pay typically covers lodging expenses. Per diem may also include additional money to cover meals and other incidental expenses, such as laundry or tips for service workers. As long as the per diem rate does not exceed the standard rate set by the government, the employee does not have to pay taxes on this type of compensation.

Related Article
What Is Per Diem Pay?