SAP Concur has been helping organisations manage expenses for over 25 years. However, it’s easy to forget that there are still employees out there who have never submitted an expense claim.
Whether you’re a small business or a large enterprise, you may be unsure of what expenses you can claim for business purposes and how you can claim them.
So, if expense management is a new concept for you or your business, here are some basics to get you started…
What is a business expense?
A business expense is a cost incurred as part of doing your day job. Basically, anytime you spend money for business purposes or spend money that you expect to be reimbursed for, you should be creating an expense claim.
What are some common business expenses?
Costs to the business often come from travel expenses. Perhaps you’re visiting a client, working from a different office location or travelling overseas for an event. Whatever the scenario, if you’ve ever travelled for work then there are probably expenses you can claim. Some of the common expense types are outlined below:
- Travel expenses e.g. train tickets, airfares, taxi fares
- Mileage or fuel costs
- Hotel or accommodation fees
- Personal food and beverage costs
- Entertainment costs e.g. client lunch
What are the different types of business expenses?
There’s an easy way to split out the different types of expenses. Consider what would require an invoice and what would go into an expense claim. Generally, low cost or “on the fly” expenses – like travel fees or a client lunch – would usually go into an expense claim. Whereas more complex, higher cost or ongoing expenses – like office furniture or a training subscription – would usually go into an invoice.
Furthermore, do you know the difference between tax deductions and tax-deductible expenses? Ultimately, they’re the business expenses set against your turnover to help calculate your profit. And you need to understand the difference to manage taxes effectively.
But before we get into the more granular details, consider your current situation. If you’re thinking ‘we have a lot of business expenses but no process to manage them’, it might be time to do some research into expense management systems