Reimbursing Expenses with ReceiptsOctober 5, 2021
Business expense reimbursements are not recognized as employee salaries. From the word reimbursement:
- These are expenses paid or incurred while the employee is delivering work for the company. Yes, it should be associated with the business or any other work-related activities.
- The employee should provide proof or supporting documents that will match the declared expenses.
In return, the employer needs to compensate the employee and reimburse the cost. Nevertheless, you need to set rules for your employees and it should include the following provisions:
- The kinds of expenses that employees can reimburse.
- The documents and receipts that are needed to submit.
- The ideal time frame for submitting report expenses.
- The process on how to request reimbursement.
- The procedure for returning overpayments or allowances.
- A system for collecting, analyzing, validating, and paying employee spending claims on an internal basis.
- The person to contact for any queries or concerns.
Expenses that are applicable for reimbursement can be travel expenses, meals expenses, office expenses, phone bills for business calls, and delivery fees.
TRAVEL AND MEAL EXPENSES
Who was present?
Why was the meal regarded as official business?
When did the meal take place?
Where did the meal take place?
How much did the meal cost?
Other documentation that the IRS official may request to validate the claims.
The IRS requires the following documents for each trip to be reimbursed for travel:
The reason for the out-of-pocket expense
The travel date
The distance traveled
Odometer readings at the start and end
OFFICE SUPPLIES EXPENSES
Office supplies checklist includes:
- Desk supplies
- Paper products
- Filing supplies
- Stationery/mailing supplies
- Computer/printer supplies
- Time tracking supplies
- Binding supplies
- Supplies for hanging
- Identification supplies
Employers should consider offering employees who purchase office supplies regularly with a corporate credit card to reduce the need and time required to refund them.
Parking garages, taxi fares, and the cost of luggage storage are all examples of travel expenses that are sometimes disregarded.
BUSINESS CALLS EXPENSES
Employees should only claim for calls made for business purposes and if requested, be prepared to present records to substantiate that the calls for which they are claiming were work-related. Aside from receipts, a phone bill or voice call record can be submitted.
Delivery reimbursement allows employees to be paid for their fuel expenses as well as wear and tear incurred with using their personal vehicle for business. The employer can specify a cash amount to be paid to the delivery driver for each delivery completed.
Expense report receipts are critical for accounting teams and employers as they can also be used for tax purposes. Organizing receipts digitally is the way forward and utilizing a receipt generator can make online receipt management run more smoothly. There are lots of receipt templates to choose from and ExpenseFast can help you create the receipts you need for your business.