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Travel and expense reporting: What it is and how to do it
Learn what travel and expense reporting is and how to submit a report in 6 steps.
Travel and expense reporting is the process of recording, documenting, and submitting business trip costs so your company can approve them, reimburse the traveler, and maintain a tax-ready record.
This guide contains:
- What goes into a travel expense report
- How to create and submit a travel expense report in six steps
- Best practices for travel and expense reporting
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Why travel and expense reporting is important
Here’s what good travel and expense reporting does for your company:
- Itemized, approved claims lower the risk of expense fraud (expense reimbursement schemes appear in 13% of cases, with a median loss of $50,000, and they typically run for 18 months before anyone catches them).
- A documented audit trail lets you deduct travel costs and reimburse them tax-free.
- Spend data shows where your money goes, so you can spot overspending early and better plan your corporate travel budget.
- Reports with itemized receipts move through approval in one pass, while a lump-sum claim missing a hotel bill is sent back for questions.
- Fast, complete reimbursement keeps employees from carrying company costs (in a June 2026 survey by Morning Brew and Engine, 37% of travelers at small and midsize businesses said they waited too long to be reimbursed, and 26% said they didn’t get their full costs back).
What goes into a travel expense report
A travel expense report lists all trip costs, with supporting documentation and a reason for each. The exact layout depends on your company’s form or software, but the core fields stay the same.
Here’s what to include:
| Field | What to enter | Why it matters |
|---|---|---|
| Employee details | Name, job title, department, and contact information | Finance knows whom to reimburse |
| Trip details | Destination, travel dates, and the business purpose of the trip | The IRS needs the time, place, and purpose of each trip |
| Line items | Date incurred (not the submission date), vendor, category, amount, and payment method | Each cost can be checked against its receipt and card charge |
| Business purpose per expense | A short reason (e.g., “Taxi to client office for contract review”) | Approvers can see why each cost was needed |
| Supporting documents | Itemized receipts or invoices | The receipt shows what was bought |
| Project or cost center code | The budget code the trip belongs to | The cost lands in the right team’s budget |
| Totals and adjustments | Subtotals by category, minus any cash advance | The final line shows what the company owes |
| Approval | Manager signature and date | The approval confirms someone reviewed the claim |
| Policy notes | A reason for any out-of-policy expense | Exceptions are explained before finance has to ask |
What counts as a travel expense
A travel expense is an ordinary and necessary cost of traveling away from home for business, according to IRS Publication 463. Your policy decides which of these costs your company reimburses, but they usually fall into a few categories, such as:
- Transportation: Airfare, train tickets, taxis, rideshares, rental cars, parking, tolls, and mileage
- Lodging: Hotel stays and taxes, extended stays, and approved short-term rentals
- Meals: A daily per diem or actual meal costs, tips, and client meals with a business purpose
- Other costs: Conference fees, baggage fees, internet and phone charges, and currency exchange fees
Your policy can also list costs it won’t reimburse, such as:
- Upgrades without approval
- Room service or in-room entertainment outside the policy
- Excessive alcohol
- Souvenirs and passport fees
- Personal side trips
- Purchases that mix personal and business items
Pro tip: It’s best to draw these lines in your company travel expense policy before anyone travels.
Per diem vs actual expenses
Your company can reimburse meals and incidentals in one of two ways, or mix them.
A per diem is a fixed daily allowance, while actual-expense reimbursement pays back what the traveler spent, receipt by receipt.
You can base your per diem on the federal rates set by the GSA. For travel from October 1, 2026, to September 30, 2027, the standard GSA rate is $113 per night for lodging and $68 per day for meals and incidentals, with higher rates in more expensive cities.
Here’s how the three options compare:
| Method | How it works | Best for | Watch out for |
|---|---|---|---|
| Per diem | The traveler gets a fixed daily amount, whatever they spend | Frequent, similar trips where you want less paperwork | It can fall short in expensive cities |
| Actual expenses | The company pays back each documented cost | Trips with unpredictable or high costs | More receipts to collect and review |
| Hybrid | A per diem covers meals, while lodging and transport are paid at cost | Teams that want simple meal rules and accurate travel costs | The policy has to spell out which costs fall under which method |
How to create and submit a travel expense report: 6 Steps
A travel expense report is quickest to file when travelers capture expenses during the trip.
Here’s how to get it right:
- Share your policy so travelers know what’s reimbursable, what needs preapproval, and the limits for each category (our guides to travel policy best practices and a business travel policy for employees cover how to set these).
- Ask travelers to photograph each receipt the same day and note the date, amount, category, and business purpose.
- List each expense by date, category, vendor, and amount, attach the itemized receipts, and total each category. Then, subtract any costs the company already paid and any cash advance.
- Ensure every expense has a receipt, a business purpose, and the right category.
- Submit the report within your company’s deadline.
- Respond to questions or rejections quickly, as a missing receipt or an unclear purpose is easier to fix while the trip is still fresh.
Best practices for travel and expense reporting
Good travel and expense reporting depends on rules people know before they travel and habits they keep on the road.
These eight practices help keep reports accurate and compliant:
- Publish your policy, per diem, and category limits before trips start.
- Capture receipts and the business purpose on the same day.
- Enforce a submission deadline.
- Assign default categories by vendor type to reduce misclassification.
- Route payments via company cards or central booking, where practical.
- Tie every record to a trip and a traveler, including guests (e.g., job candidates or contractors).
- Reconcile on a regular schedule and send data to accounting the same way each time.
- Review the policy at least once a year.
Reconciliation can work manually if everyone knows who handles each step.
Still, bringing bookings, cards, and receipts into a single system eliminates the need for manual matching. A travel management system handles the booking side, while travel and expense management software captures receipts and syncs expenses to your accounting system.
Check out our guides to travel and expense management, corporate travel planning, and building a corporate travel program to learn more.
Give traveling employees secure data with Holafly for Business
When your team travels for work, secure mobile data is part of the plan.
Holafly for Business is an eSIM provider available in 160+ destinations that activates on employees’ devices, so your travelers don’t have to buy local SIM cards or incur roaming charges. Admins also get access to our centralized management platform, the Holafly Business Center, where they can manage individual eSIMs, invoices, and data usage.
Holafly Plans for Business come in four tiers, all featuring hotspot, 4G/5G, and 24/7 multilingual support:
- Daily: Unlimited data with pay-per-day flexibility, built for short business trips under 16 days a month.
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- Annual: Unlimited data for ultra-frequent travelers, suited to long-term global operations and predictable annual budgets.
- Enterprise: Bespoke plans for companies managing travel for 20+ employees a year, with volume discounts, a dedicated account manager, priority support, and custom integrations, built to optimize costs, streamline operations, and ensure seamless global connectivity across teams.
Not sure which plan is right for your team? Book a demo.
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FAQ
The IRS treats it as a reasonable period when employees account for travel expenses within 60 days and return any excess within 120 days. Your company’s deadline can be much shorter, and our travel policy best practices guide recommends 5–10 business days after the trip.
Companies should aim to pay approved travel expense claims within 10–15 business days.
You should keep travel expense records for three years from the date you file the tax return that claims the deduction, according to IRS Publication 463.
I’m a writer with over eight years of experience in digital content. My work has appeared in publications such as The New York Times, Forbes, Business Insider, and the BBC. At Holafly, I write clear, practical guides to help travelers stay connected with eSIM technology. In my spare time, I enjoy car detailing, biking around Warsaw, and capturing portraits.
