Acceptable Expenses Claims

It is important to understand what your employer considers to be acceptable expenses claims so you are not unnecessarily out of pocket. In the course of your work, there will often be a number of expenses incurred, with many able to be claimed back.

Most companies where employees incur expenses are expected to put in a monthly expenses claim in a certain format with particular information to support the claim. This is often done in the form of a spreadsheet, with receipts as proof for all items, although often items under a small value (perhaps £3 or £5) do not need accompanying receipts.

It is a good idea to speak to your line manager or company accountant about acceptable expenses related to your particular company and your role within in, but here is a guideline for generally accepted expense claims.

Employee Travel Expenses

The rule for the majority of employee expenses is that it must be ‘wholly, exclusively and necessarily’ incurred for the job. In terms of travel, this does not mean that you can claim for the cost of getting to and from your home to your normal place of work, but you can claim for travel expenses outside of your normal working week. Therefore, if your normal place of work is an office in central London and you live in Zone 4, you cannot claim your travel card on expenses, but if you have to take a taxi to a meeting within your working day, you usually can.

It is worth bearing in mind that some companies have a ‘black cab only’ policy and others may have a ‘public transport wherever possible’ policy, so check with your employer to see what they regard as acceptable. It may be that cabs are acceptable if there is more than one person, or if it is after 5pm, for example.

Entertainment Expenses

Acceptable expenses claims for entertainment vary greatly depending on your role. Marketing and business development roles tend to incur far more entertainment expenses, as it is likely you will need to take clients out for lunch or dinner, or meet contacts for coffee. You must always keep your receipts and often your company accountant or book keeper will need to know who you saw and which company they are from. Your line manager is also likely to want to know this information to be able to ascertain if the money is being well-spent in relation to winning business.

You will get to learn the types of places it is acceptable to take your clients. Your employers are unlikely to be happy to pay for a Michelin-starred tasting menu dinner for a client that hardly brings in any business.

Subsistence

Subsistence refers to a daily or weekly amount that employers allow employees when they’re working away from their usual place for work. For example, if you’re requested to spend a week in the Paris office when you’re usually based in London, as well as the travel and entertainment expenses, you would usually be allowed perhaps £50 or £100 per day to cover additional costs, such as lunch, extra dry cleaning etc.

Many people do not actually have to dip into this amount and save it as a perk, but it is usually a set amount depending on your grade/employer.

Receipts do not need to be kept as it is a set amount rather than in payment for something you’ve already bought.