Travel Costs Covered by FAR 31.205-46
FAR 31.205-46 addresses several major categories of contractor travel. Transportation costs may be based on mileage rates, actual costs, or a combination of methods when the resulting charge is reasonable. Lodging, meals, and incidental expenses may similarly use per diem, actual expenses, or a combination when the resulting charge is reasonable. :contentReference[oaicite:1]{index=1}
- Transportation: Airfare, mileage, and other qualifying transportation expenses associated with official business travel.
- Lodging: Accommodation expenses subject to applicable reasonableness and per diem requirements.
- Meals: Subsistence costs evaluated against applicable travel rates and circumstances.
- Incidental expenses: Qualifying travel-related expenses that fall within the regulatory treatment of incidental costs.
The applicable treatment depends on the type of expense, destination, travel circumstances, and supporting documentation.
Per Diem and Allowable Travel Amounts
For lodging, meals, and incidental expenses, FAR 31.205-46 generally limits allowable costs to the maximum applicable per diem rates in effect at the time of travel. The regulation references Federal Travel Regulations for the contiguous United States, Joint Travel Regulations for specified U.S. areas, and Department of State regulations for foreign areas. :contentReference[oaicite:2]{index=2}
Special or unusual situations can permit actual costs above the referenced maximum per diem amounts when specified conditions are satisfied. These conditions include an approved justification, appropriate contractor authorization, and additional approval when higher actual-expense treatment is required repeatedly or continuously in a particular area. :contentReference[oaicite:3]{index=3}
For example, if an employee incurs $185 in lodging and the applicable maximum is $160, the additional $25 does not automatically become allowable merely because it was actually paid. The contractor must evaluate whether the circumstances meet the regulatory requirements for higher actual expenses and retain the required justification and supporting documentation.
Documentation and Recordkeeping Requirements
Documentation is central to demonstrating that travel costs satisfy FAR requirements. The regulation requires records identifying the date and place of the expense, purpose of the trip, and name and title or relationship to the contractor of the person on the trip. :contentReference[oaicite:4]{index=4}
For special or unusual situations involving higher actual expenses, the required written justification and applicable approval must also be retained. Receipts are required for each expenditure of $75.00 or more under the specific higher-expense provisions. :contentReference[oaicite:5]{index=5}
A well-structured Travel Expense Policy can translate these regulatory requirements into employee-facing rules for approvals, receipts, mileage, lodging, meals, and supporting records.
Airfare and Contractor-Owned Transportation
FAR 31.205-46 generally addresses airfare above the lowest priced airfare available to the contractor during normal business hours. Higher airfare can be allowable when specified circumstances apply, such as unreasonable travel hours, circuitous routing, excessive travel time, mission requirements, or certain traveler needs, provided the applicable condition is documented and justified. :contentReference[oaicite:6]{index=6}
Contractor-owned, leased, or chartered aircraft receive additional treatment. Related travel must be fully documented and justified, and contractors charging or allocating such aircraft costs to Government contracts must maintain and make available flight manifests or logs containing specified trip and passenger information. :contentReference[oaicite:7]{index=7}
Travel Costs in Finance and Procurement Workflows
Government contractors often connect travel records with contract accounting, project costing, employee reimbursement, and financial reporting. A Travel And Expense Module can provide a structured workflow for capturing expenses, routing approvals, retaining documentation, and transferring approved information into finance systems.
Travel-related purchasing can also intersect with procurement controls when organizations establish approved suppliers, booking procedures, authorization rules, or spending policies for employee travel. A purchase order may also be relevant when travel-related services are procured through controlled purchasing arrangements, although the appropriate accounting treatment depends on the transaction and contract requirements.
When finance systems or ERP environments are being modernized, contractors can also review How Hyperbots Helped Avoid Millions in ERP Migration Costs for broader discussion of ERP migration, finance workflows, and technology-enabled accounting processes.
Travel Allowances and Compliance Practices
Travel Allowance describes an amount provided or reimbursed for qualifying travel expenses under an organization's established rules. For FAR-covered contractors, internal allowances should be administered consistently with applicable contract requirements, company policies, and the FAR provisions governing allowability.
Organizations can strengthen travel-cost administration by establishing approval thresholds, retaining supporting documentation, mapping expenses to contracts or cost objectives, reviewing rate exceptions, and reconciling travel records before contract cost submissions or financial reporting.
The related Manual Purchase Order Process vs Automated: Cut 80% Costs article provides educational context on purchase order processing, procurement controls, approvals, and workflow automation. These concepts can complement travel controls where travel-related purchasing is subject to formal procurement procedures.
Summary
FAR 31.205-46 Travel Costs provides the regulatory framework for determining the allowability of contractor transportation, lodging, meals, and incidental travel expenses charged to Government contracts. Key practices include applying appropriate travel rates, documenting the date, location, purpose, and traveler, supporting exceptions with required justification, and maintaining records that connect expenses with contract and accounting processes. :contentReference[oaicite:8]{index=8}