Employee expenses: guide for employers

Don't forget, you can use our PoP (proof of purchase) app to keep track of employee spending

If you’re an employer that offers staff expenses and benefits, it’s good business practice to let HM Revenue and Customs (HMRC) know.

That way you can pay tax and National Insurance on the likes of company cars, health insurance, and travel requirements.

It can be a tricky topic to get right. So, in this guide we cover everything you need to know about expenses.

But we’ll also introduce you to PoP—our expense tracker. You may find it very useful as part of your pay and benefits package. So, let’s get started.

What expenses can an employee claim?

There are quite a few allowable expenses for employees—these include:

  1. Temporary accommodation at a workplace.
  2. Business travel on bikes.
  3. Business travel mileage for employee vehicles.
  4. Car parking charges when travelling on business.
  5. Clothing (as in, uniform).
  6. Business travel mileage for company cars or vans.
  7. Additional costs of working from home.
  8. Business travel to a temporary place of work.
  9. That’s not an extensive list, but it shows you the extent of expenses employees can claim for.

Always a tricky area, of course, is VAT (that’s value-added tax—this is assessed incrementally).

Employee expenses app

Of course, you can simplify your process with a bit of modern technology. That’s where our expense tracker app (PoP—proof of purchase) to help you out.

It helps you to manage your employees easily. You can approve them wherever you are—at the office, or on the go.

The features of the app are designed to offer accessibility and simplicity. You can:

  1. Request employees to log all expenses, which you can then approve or decline. To do either, it’s the swipe of a button.
  2. Receive instant notifications when a member of staff submits a request.
  3. Place control in your employees’ hands, so they can work out mileage and calculations.

In short, the app does away with a potentially long-winded documentation process.

Plus, it makes documenting mileage easier. Travel costs are often one of the leading expenses you need to keep track of.

It also removes the need for difficult sums that could leave you scratching you head. All your employees have to do is enter basic details and the app works it all out. Simple!

Employee business expenses form You can provide your member of staff with a form to fill out—this can be especially useful if they’re going on a trip.

You can, of course, use PoP to simplify this process.

However, if they don’t have access to the software you can take a different route. Printing off a form can help keep track of employee travel expenses.

These sort of trips can generate food expenses for employees—along with other fees such as:

  1. Airplane tickets.

You can easily create a form using a Word document—you’ll want to make columns so the employee can document their spending on:

  1. Meals at restaurants.
  2. Vehicle expenses.
  3. Parking fees.
  4. Toll charges.
  5. Public transport costs.
  6. Entertainment costs.

You should then leave room for the total charges to be worked out.

You can use the form along with an app like PoP to ensure accuracy, as it’s important for staff to keep track of fees as they go along.

Can a company reclaim VAT on employee expenses? Yes, as part of employee expense deduction you can—but only in certain circumstances.

To reclaim back from HMRC (HM Revenue & Customs), you must gather all invoices and receipts in the name of your business.

When traveling on business, you can reclaim VAT on purchases that go up to a maximum of £150.

But that’s so long as you have the receipts available. As such, you should instruct your employees to keep all receipts during their trip.


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