Managing employee travel can feel like herding cats. Between tracking receipts, enforcing policies, ensuring compliance, and reimbursing expenses, it's easy for things to spiral out of control—costing your business time, money, and sanity.
This guide shows you how to transform employee travel from a necessary headache into a streamlined process that saves money while keeping everyone happy. We'll cover why travel management is so challenging, what makes a good travel program, and how the right tools can simplify everything.
Why employee travel is hard to manage without the right systems
Employee travel generates more administrative work than almost any other business expense. Without the right systems in place, managing travel becomes a time-consuming process that affects everyone from travelers to finance teams to managers.
Tracking receipts becomes a full-time job
When employees travel, they generate receipts for everything from flights and hotels to meals and ground transportation. Someone has to collect all that supporting documentation, verify it matches the expense claims, and file it properly for tax purposes. Paper receipts get lost, crumpled, or fade over time. Employees forget to submit them or submit incomplete information that requires follow-up.
Policy compliance is nearly impossible to enforce
Most companies have travel policies that specify acceptable costs for lodging, meals, and other expenses. But enforcing these policies manually is exhausting. By the time finance reviews an expense report, the money's already spent. That means you're either having uncomfortable conversations about reimbursement or letting policy violations slide, which sets a bad precedent.
Reimbursement delays frustrate employees
The typical reimbursement process takes weeks. Employees submit expense reports, wait for approval, then wait for accounting to process payment. Meanwhile, they're carrying charges on personal credit cards and getting frustrated with the delay. This especially impacts employees who travel frequently or those who may not have the financial cushion to float business expenses.
Budget visibility disappears across departments
When different departments book travel independently and employees submit expenses weeks after trips, you lose visibility into your travel spending. You can't see patterns, identify cost-saving opportunities, or track whether you're staying within budget. By the time you realize spending is out of control, it's too late to course-correct.
Compliance with federal travel regulations creates confusion
For organizations that need to follow federal travel regulations—like those working with federal agencies or receiving government funding—the complexity multiplies. Federal rules specify per diem rates, require documentation of a bona fide business purpose, and set specific standards for the actual cost of travel within the continental United States and beyond. Keeping track of these requirements manually while ensuring every trip meets the business purpose standard is incredibly challenging.
Tax reporting becomes a nightmare
Come tax time, you need to prove that all travel expenses served a legitimate business purpose and weren't actually fringe benefits. You need to separate travel expenses from moving expenses, document incidental expenses, and account for everything from telephone calls to meals. Without organized records throughout the fiscal year, tax preparation becomes a scramble to reconstruct months of travel activity.
Multiple approval workflows slow everything down
Different trips require different approvals. A single trip to visit a client might need manager approval, while a week-long conference might require executive sign-off. Round trip flights cost more than local travel, international trips need additional review, and trips that combine business with vacation need careful scrutiny. Managing these varied approval requirements manually creates bottlenecks that delay both bookings and reimbursements.
Fraud and errors go undetected
Without systematic controls, mistakes and fraud slip through. Duplicate submissions happen, personal expenses get mixed with business costs, and policy violations go unnoticed. By the time accounting catches an issue, the payment may have already processed, making recovery difficult.
What makes a successful employee travel program?
Creating an effective travel program requires more than just writing a policy document. You need integrated systems and clear processes that work together to manage costs while supporting your employees.
Clear travel policies establish expectations
Your travel policy should specify what's covered and what isn't. This includes setting maximum amounts for hotel rooms, establishing per diem rates for meals, and defining which transportation methods are approved. The policy should address common scenarios employees will encounter—like whether tips are covered, how to handle entertainment expenses, or what to do when traveling with family members.
Streamlined booking processes save time and money
The easier you make it to book approved travel, the more likely employees will follow your process. This might mean partnering with preferred travel services, setting up corporate accounts with hotels near common destinations, or providing access to booking platforms that automatically enforce policy limits. When employees can quickly find compliant options, they're less likely to book outside the system.
Expense tracking systems capture costs in real time
Modern expense management doesn't wait until after the trip. The best systems let employees log expenses as they happen, capture receipts digitally, and automatically categorize spending. This real-time approach ensures nothing gets forgotten and provides immediate visibility into costs.
Approval workflows keep spending on track
Automated approval routing ensures the right people review expenses before payment. Simple trips might need only manager approval, while international travel or trips over a certain dollar value might require additional sign-off. The system should route expenses based on rules you establish, ensuring consistent application of your policies.
Reimbursement processes respect employee time
Fast, reliable reimbursement shows employees you value their time and trust. The process should clearly explain how to submit expenses, what documentation is required, and when to expect payment. Employees shouldn't have to wonder whether their expense report was received or when they'll be reimbursed.
Corporate cards reduce reimbursement burden
Providing corporate cards for travel eliminates the need for employees to use personal funds. They can pay for approved expenses directly, and the company gets detailed spending data immediately. This approach is particularly valuable for employees who travel frequently or those who might struggle to float significant expenses.
Documentation requirements protect everyone
Clear documentation serves two purposes: it proves expenses were legitimate business costs, and it provides the records needed for tax purposes. Your system should make documentation easy—letting employees snap photos of receipts, add quick notes about the business purpose, and attach additional supporting information when needed.
Policy education ensures compliance
Even the best travel policy fails if employees don't understand it. Provide training when employees start traveling for business, and offer refreshers as policies change. Make the policy easily accessible—not buried in a handbook nobody reads.
Reporting and analytics drive better decisions
Your travel program should generate data that helps you make better decisions. Which destinations are most expensive? Are certain departments consistently over budget? Regular reporting helps you spot trends before they become problems—like seasonal cost spikes or locations that consistently exceed budgets—so you can negotiate better rates or adjust policies proactively.
Integration with accounting systems eliminates double entry
Your travel management system should connect directly to your accounting software. When an expense is approved, it should flow automatically into the right accounts, properly coded and ready for financial reporting. This eliminates manual data entry, reduces errors, and ensures your financial records stay current.
How BILL Spend & Expense simplifies employee travel management
BILL Spend & Expense transforms employee travel from a manual headache into an automated process that saves time while providing better control.
Real-time expense tracking eliminates receipt chaos
Employees can capture receipts instantly using their phone camera. The system automatically reads the receipt, extracts key information, and categorizes the expense based on your policies. Everything is organized and stored in one place where finance teams can easily access it.
Automated policy enforcement prevents overspending
BILL enforces your travel policies automatically. When employees submit expenses, the system checks them against your rules. This real-time enforcement prevents policy violations before money is spent, rather than discovering problems weeks later during reconciliation.
Complete visibility into travel spending
See exactly how much your organization is spending on travel at any given moment. Track expenses by department, employee, trip, or destination. Spot trends, identify opportunities to save money, and ensure spending stays within budget. The system provides the real-time visibility that manual processes can never achieve.
Seamless integration with your accounting system
BILL connects directly with your accounting software, automatically syncing approved expenses to the right accounts. This eliminates manual data entry, reduces errors, and ensures your financial records are always current. When tax time arrives or you need to prepare reports, all your travel expense data is properly organized and documented.
What our customers say
"Gone are the days of holding onto receipts, hoping you don’t lose them by the time you return to the office. BILL’s virtual cards and mobile app allows for quick receipt upload on the spot." — TurnoverBnB
"Golf Genius has saved significant time creating and processing expense reports—at least 60 hours a month as a company." — Golf Genius
Frequently asked questions about employee travel
Managing employee travel raises plenty of questions, especially when you're determining policies or handling edge cases. Here are answers to some of the most common questions about travel expenses, reimbursement, and compliance.
What counts as a business day for travel purposes?
A business day for travel typically includes any day when an employee is conducting work away from their normal location. This includes the actual days of meetings or conferences, plus necessary travel days to reach the destination and return. Weekends or holidays spent at the destination may count as business days if work activities occur during those times or if staying at the location is more cost-effective than making a return trip.
How do I determine which city's per diem rates apply?
The per diem rates you use should match the city where your employee is staying overnight, not necessarily where they're conducting business. For example, if an employee works in one city but stays at a hotel in a nearby suburb, you'd use the rates for the suburb. The General Services Administration (GSA) provides per diem rates by city to help you determine the correct amounts for locations within the continental United States.
What are the two methods for calculating travel reimbursement?
The two methods for travel reimbursement are actual cost and per diem. With the actual cost method, you reimburse employees for their exact expenses based on receipts and documentation. With the per diem method, you pay a fixed daily rate that covers meals and incidental expenses regardless of actual spending. Many organizations use actual cost for major expenses like lodging and transportation while applying per diem rates for meals and other daily expenses.
Can employees use their own vehicle for business travel?
Yes, employees can typically use their personal vehicle for business travel. Most organizations reimburse mileage at the IRS standard rate, which covers fuel, maintenance, and vehicle wear. You'll need to track the departure point, destination, purpose of each trip, and total miles driven. Some policies require prior approval for vehicle use, especially if the trip exceeds a certain distance or when other transportation options might be more cost-effective.
What food expenses are reimbursable during business trips?
Food expenses during business travel are generally reimbursable either through per diem allowances or actual cost reimbursement, depending on your policy. This typically includes meals during travel days and while at the destination. However, food costs might not be fully reimbursable if the trip includes entertainment purposes or if meals are provided as part of a conference or event. Be clear in your policy about whether alcohol is included and if there are limits on meal costs.
Do I need receipts for expenses at the airport?
Receipt requirements at the airport follow the same rules as other travel expenses. Most organizations require receipts for any expense over a certain threshold ($25 is fairly common). This includes airport parking, baggage fees, ground transportation from the airport, and any food purchases. Small incidental expenses like coffee may not require receipts if they fall below your policy threshold, but it's always best practice to keep documentation for all business expenses.
Are there any tax exemptions for business travel expenses?
Business travel expenses that meet IRS requirements for ordinary and necessary business purposes are generally tax-deductible for the company and not considered taxable income for employees. This includes transportation, lodging, and meals while traveling for business. However, expenses must be properly documented with receipts and records showing the business purpose. Personal expenses, even if they occur during a business trip, don't qualify for these tax exemptions.
What's an example of proper travel expense documentation?
Proper documentation for a business trip includes receipts for all major expenses (flights, hotels, rental cars), a clear explanation of the business purpose for the trip, dates of travel, and the destination. For example, a properly documented conference trip would include the conference registration receipt, hotel receipt showing the dates stayed, flight itinerary, any ground transportation receipts, and meal receipts or per diem calculation. Notes should explain who attended, what business was conducted, and how it relates to the employee's role.
How do I determine the total cost when comparing travel options?
To determine the total cost of different travel options, consider all expenses including transportation, lodging, meals, parking, and other incidental costs. For example, driving might seem cheaper than flying until you factor in mileage reimbursement, hotel costs for an extra night due to longer travel time, and additional meal expenses. Compare the complete cost of each option, including the value of employee time spent traveling, to make the most cost-effective decision.
Who is responsible for booking employee travel?
Responsibility for arranging and booking travel varies by organization. Some companies require employees to book their own travel within policy guidelines, while others have administrative staff or use a travel management service to handle bookings. The key is establishing clear procedures in your policy about who handles booking, what approval is required prior to booking, and what to do when employees need to make last-minute changes or handle travel emergencies.
