Tax
Claiming subsistence as a company director: how the flat rates work, and why your diary matters more than your receipts
As a company director you can claim tax-free subsistence for meals and overnight stays on business trips using HMRC's benchmark flat rates, with no receipts required. The catch is that you must keep a proper travel diary. Here is how the rates work and what to record.
By David ElliottBSc FCA, Founder & Managing PartnerFigures in this piece were checked on 25 September 2026. Rates and thresholds change, so confirm anything you are relying on.
If you are the director of your own limited company and you travel for business, you are entitled to claim tax-free subsistence for meals and overnight stays without HMRC ever asking to see a receipt. That sounds almost too good to be true, but it is a genuine, long-standing HMRC concession, provided you claim the right amount for the right kind of trip and keep the right record of it.
The catch is that “the right record” is not a pile of till receipts. It is a diary. Get the diary right and the flat rates look after themselves. The good news is that eba has produced a spreadsheet “diary” you can use for exactly this, with a business mileage log built into the same sheet, so you can keep track of both mileage and subsistence claims in one place. Just ask us for it.
What subsistence actually covers
Subsistence is the cost of food and drink, and for overnight stays a few personal incidental expenses, that you would not have had to pay if you were not travelling on business. HMRC accepts that chasing down a receipt for every coffee and sandwich is disproportionate, so instead of reimbursing actual, evidenced cost, your company can pay you a fixed “benchmark scale rate” based on how long you were away and what time of day it was. It is tax-free, free of national insurance, and deductible for corporation tax.
These flat rates are an alternative to claiming actual costs. You can still claim genuine, receipted expenditure instead if that suits a particular trip better, but for the great majority of routine business travel the flat rates are simpler and, for a well-organised director, usually just as generous.
The three meal rates: it comes down to hours away
The principle is a simple table based on how long you are away from home, or from your normal place of work, on a qualifying business trip.
| Time away from home or normal workplace | Tax-free flat rate |
|---|---|
| At least 5 hours | £5 |
| At least 10 hours | £10 |
| At least 15 hours (and still travelling at 8pm) | £25 |
You claim whichever single band you qualify for. The rates are not cumulative, so a trip that keeps you out for 11 hours attracts the £10 rate, not £5 plus £10.
The late-evening top-up
If your day runs later than planned, HMRC recognises that you have had to buy a meal you would not otherwise have needed. Where the 5-hour or 10-hour rate applies and you are still travelling at or after 8pm, your company can pay a further £10 on top. So a working day that runs past 8pm can produce £15 (the £5 rate plus the £10 top-up) or £20 (the £10 rate plus the £10 top-up). This top-up does not apply on top of the £25 rate, because that rate already assumes you are still out at 8pm. £25 is the maximum a single day’s meal claim can reach under the flat-rate structure.
If all of this sounds fiddly, do not worry. All you have to do is fill in the spreadsheet.
Overnight stays: a separate, smaller allowance
If a trip keeps you away overnight, there is a second and entirely separate allowance for “incidental overnight expenses”, things like a phone call home, a newspaper, or laundry, rather than meals. Your company can pay:
- £5 per night for a UK overnight stay
- £10 per night for an overnight stay outside the UK
This sits on top of the meal rates above, not instead of them. One point worth flagging clearly: if you go even a pound over the £5 or £10 limit, the entire amount becomes taxable, not just the excess. It is an all-or-nothing limit, so it is not worth stretching.
The conditions that have to be met
The flat rates are generous, but they are not automatic. Three things have to happen for a claim to qualify.
- The trip has to be genuine business travel, either travelling in the course of your duties or travelling to a temporary workplace. Your ordinary commute to your company’s usual place of business does not count, however early you leave or however long the drive is.
- You have to have actually bought food or drink after setting off. If a client fed you at the meeting, or the cost was covered some other way, there is nothing to claim for that period.
- The claim has to reflect a real, qualifying trip, which is where record-keeping comes in.
Why your diary matters more than your receipts
Since April 2019, HMRC no longer expects employers to check receipts or bank statements to confirm what an employee actually spent when a benchmark rate is being used. That is the whole point of a flat rate. But the relaxation came with a condition: your company still has to operate a system for checking that qualifying travel actually took place. In practice, that means a detailed log of where you went, when, and why.
For a company where the director is also the person approving their own expenses, this matters even more than usual. HMRC pays close attention to payments between a company and its owner-director, so a credible diary is your best protection if a claim is ever queried, far better protection, in fact, than a shoebox of receipts you did not need to keep.
A good subsistence diary captures, for every trip:
- The date, and the start and end date and time of the trip. This is what determines your hours away and whether the late-evening or overnight rules are triggered.
- Where you travelled from and to
- The business purpose of the trip
- Whether you are claiming the late meal, and whether the stay was overnight
- If overnight, whether it was in the UK or overseas
- A brief note of anything unusual, such as a delayed train, a meeting that overran, or a client who fed you, in which case do not double claim
Run the hours through the table, apply the late-evening or overnight add-ons where they are genuinely earned, and you have a claim that is both correct and easy to defend.
The bottom line for directors
Used properly, the benchmark scale rates are a clean, low-admin way to get real travel costs out of your company tax-efficiently, with no P11D reporting and no benefit-in-kind for you personally. The whole system rests on one habit: log the trip on the day it happens, honestly and consistently. If you are already doing that, the rates essentially calculate themselves.
If you would like us to check your current subsistence claims against these rules, or help set up a simple recurring diary process for the whole board, get in touch.
Frequently asked questions
Can a company director claim subsistence without keeping receipts?
Yes. HMRC’s benchmark scale rates let your company pay you a fixed, tax-free amount for meals on a qualifying business trip without evidencing the actual spend. You do still need to keep a travel diary showing the trip took place, and you must have genuinely bought food or drink after setting off.
What are HMRC’s flat subsistence rates?
£5 if you are away at least 5 hours, £10 if you are away at least 10 hours, and £25 if you are away at least 15 hours and still travelling at 8pm. The bands are not cumulative. On top of the £5 or £10 rate, a further £10 late-evening meal rate applies if you are still travelling at or after 8pm.
What is the overnight incidental expenses allowance?
Separate from meals, your company can pay £5 per night for a UK overnight stay and £10 per night for an overnight stay outside the UK, for incidentals like a phone call home or laundry. If you exceed the limit by any amount, the whole payment becomes taxable, not just the excess.
Does my commute to work count as business travel?
No. Travelling to your company’s usual place of business is ordinary commuting and does not qualify, no matter how early you leave or how far it is. The rates apply to travel in the course of your duties or to a temporary workplace.
Do I have to report subsistence on a P11D?
No. When the benchmark scale rates are used correctly for qualifying travel, there is no P11D reporting and no benefit-in-kind on you personally. The payment is tax-free, free of national insurance, and deductible for the company.