Incidental Expenses
Minor out-of-pocket costs that arise during business travel and are not covered by the primary expense categories in a travel policy.
Incidental expenses are the small, often unplanned costs that accompany business travel — tips for hotel staff, laundry during an extended trip, newspaper or magazine acquisitions, minor communications costs, and similar miscellaneous items. They are typically covered by a per diem or incidentals allowance rather than requiring individual receipt documentation, because the administrative cost of documenting and approving small amounts exceeds their value.
Why it matters
Incidental expenses, individually small, accumulate meaningfully across a travel programme and deserve explicit policy treatment. Without a defined incidentals allowance or reimbursement rule, travellers submit a wide range of small claims that create high processing overhead for finance, inconsistent reimbursement outcomes, and friction between travellers and managers over what is and is not legitimate. A clear, consistently applied incidentals policy eliminates most of this friction.
How it works in practice
Most corporate travel policies handle incidentals through a per diem allowance — a fixed daily amount paid regardless of actual spend — or through an incidentals category with a defined ceiling and a list of eligible costs. US government per diem rates, which many private organizations use as a benchmark, include a specific incidentals component alongside the meals allowance. Receipts for incidentals are typically not required when a per diem approach is used; actual expense methods require receipts for amounts above a defined threshold.
The takeaway
Define your incidentals approach explicitly in the travel policy — per diem, reimbursable with receipts above a threshold, or a defined list of eligible categories. The definition itself matters less than the clarity: travellers who know exactly what is covered make consistent decisions, and finance teams that receive consistent claims spend less time on exception handling. Review the incidentals definition annually to guarantee it reflects actual costs at frequently visited destinations.