What do you need to know about expense reimbursement?
What Is Expense Reimbursement? The expense reimbursement process allows employers to pay back employees who have spent their own money for business-related expenses. When employees receive an expense reimbursement, typically they won’t be required to report such payments as wages or income.
When to reimburse employees for out of pocket expenses?
Set expectations for when and how employees will be reimbursed. For example, you could reimburse employees for out-of-pocket expenses via direct deposit when they get their paychecks, or you could cut checks 30 days after the expenses have been processed. It’s just a matter of deciding what works best for your organization.
What should be included in a travel reimbursement policy?
Including the expense reimbursement policy in your corporate travel policy to make it even more accessible. Equipping employees with travel and expense software to enforce the policy. Give them an expense management tool to help collect receipts and file expense reports and travel booking software to track travel expenses.
When is the best time to implement a reimbursement policy?
Another factor in the success of your expense policy is timing. To optimize adherence to a new policy, implement it at the start of a new year (fiscal or calendar) or after you’ve created new budgets or audited travel and expense spending. After implementing your reimbursement policy, it’s important to enforce it to avoid fraud.
When do you need an expense reimbursement policy?
Any business in which an employee makes a purchase on behalf of the company using personal funds (cash, personal credit card, etc.) instead of a corporate credit card should have an expense reimbursement policy. Out-of-pocket business expenses are very common for event planning or travel heavy roles.
When do you need original receipts for reimbursement?
While original receipts are recommended for all expenses submitted for reimbursement, they are required for all expenses greater than $25.00. Requests for exceptions to this policy should document extenuating circumstances and be approved by the CFO.
Including the expense reimbursement policy in your corporate travel policy to make it even more accessible. Equipping employees with travel and expense software to enforce the policy. Give them an expense management tool to help collect receipts and file expense reports and travel booking software to track travel expenses.
Set expectations for when and how employees will be reimbursed. For example, you could reimburse employees for out-of-pocket expenses via direct deposit when they get their paychecks, or you could cut checks 30 days after the expenses have been processed. It’s just a matter of deciding what works best for your organization.