When an employee incurs business expenses, he or she must complete an expense claim form and submit it to the finance department, together with various supporting documents. These documents are essential for the reimbursement of expenses. This makes the process of processing expense claims a tedious one, both for the employee and for the finance and accounting departments. Nevertheless, these formalities remain essential.
Why do I need to justify my expenses?
Business expenses are deductible from sales and exempt from social security charges. For certain types of expenditure, it can also record deductible VAT.
On the employee side, the reimbursement of business expenses is not included in the base for calculating income tax, and is not subject to social security contributions, except in a few rare cases.
For example, some companies are tempted to inflate business expenses to reduce profits or collect VAT. They may also use them to pay additional remuneration to employees, without this being subject to income tax or social security contributions.
That's why URSSAF has introduced a number of basic rules designed to limit abuses. These include the presentation of certain supporting documents. During a tax audit, the controller generally pays particular attention to this part of the company's expenses. It is a fact that the absence or inadmissibility of certain supporting documents is the main reason why companies are subject to tax reassessment.
An unsubstantiated or inadequately substantiated expense claim reimbursed by the company is reclassified as a benefit in kind, giving rise to an adjustment.
Proof of costs incurred
Transport costs
In the event of a business trip, the company must reimburse the employee for all transportation costs. To do this, the employee fills out an expense claim form, on which he or she must mention: + the precise reason for the trip + the date + the place
To qualify for reimbursement, the employee must also enclose proof of ticket purchase. The company can also pay for the journey between the employee's usual place of work and the place of departure (train station, airport, etc.). In the case of a cab journey, the employee must present the driver's original ticket.
If the business trip is made using a company car, the company must reimburse all fuel and toll costs, on presentation of the relevant receipts.
Travel expense fraud
Some employees who want to make a small margin may be tempted to cheat, for example by buying 1st class tickets in order to obtain a receipt for payment, have them refunded and buy 2nd class tickets again. Others are tempted to ask the cab driver to cheat on the fare.
Mileage expenses
Kilometric allowances are reimbursed according to a URSSAF scale. ** To obtain reimbursement, the employee must in principle provide the **registration certificate for the vehicle used for the journey. He/she must also specify: + the location and reason for the trip + the date + the total mileage + the vehicle's tax rating.
Common mileage allowance frauds
In order to be reimbursed more, it is not uncommon for employees to declare a trip made with a more powerful vehicle than the one actually used.
Meal expenses
If the employee has to eat on site, meal expenses must be reimbursed. As for the above-mentioned expenses, the following must be mentioned on the expense claim: + the location and reason for the mission + the date
A receipt from a restaurant, bakery, supermarket, etc. must also be attached to the application.
Please note that meals may be reimbursed on a lump-sum basis. In this case, no receipts are required.
If it's a business meal with a client, you'll need to provide the restaurant's receipt showing the number of guests. Then, for each guest present, you'll need to specify: + name + company name + position in the company
Meal expenses fraud
Some employees who love good restaurants are tempted to treat themselves by asking the restaurateur to falsify the number of covers on the receipt. By declaring a false name, they can enjoy a good meal at the company's expense.
Accommodation expenses
If the distance between the employee's place of residence and the location of the assignment is more than 50 kilometers, and it is difficult to cover this distance in less than 1.5 hours by public transport, the accommodation costs will be borne by the company. In such cases, proof of payment must indicate: + the number of nights + all expenses charged to the room + a zero balance.
Hosting fraud
Some employees on business trips don't hesitate to use additional hotel services that are not covered. They have them included in the overall non-itemized bill, so that they go unnoticed. In other cases, when the meal is included in the room package (half-board, for example) and the restaurant provides an additional receipt, the employee may be tempted to have it reimbursed twice.
Miscellaneous expenses
Whether it's company-ordered workwear, professional documentation or any other purchase made on behalf of the company, it's important to provide detailed proof. This must include: + the name of the supplier + the date + the items purchased + the total amount + the method of payment used.
Justifying expense claims is not something to be taken lightly. A tax reassessment can be painful if the company has been too lax on the subject. New technologies offer many ways for companies to avoid problems.
Anytime offers an account with prepaid cards that can be easily used by employees. In this way, the company is spared the cumbersome task of keeping track of expenses, and the collection of receipts is greatly simplified.
