“The best product available for managing expenses!”
“Using Soldo has totally transformed our expense process. My employees are delighted by the ease of use – as am I!”
What is an employee expense policy?
An employee expense policy is a document outlining the things team members are and are not allowed to spend company money on.
It’s important because it makes it clear from the outset how much they can spend on items like meals and miles. It also clarifies what they’re not eligible to use funds for, so there are no disputes further down the line.
A good expense policy will save your company valuable time and resources, as well as help to protect against fraud and compliance breaches. And Soldo, a multi-user expense account with advanced spending controls, is a great way to make sure it’s implemented properly.Get started
What sort of things does an employee expenses policy include?
Each expense policy is unique to the company it belongs to, but permissible expenses usually include:
- Travel costs, including airfare, train tickets, taxis and fuel costs
- Accommodation and meals
- Miscellaneous costs, including client entertainment, parking and transaction fees
Expense policies also lay out what you won’t cover. You can make it clear, for example, that you won’t pay for five star hotels or first-class travel. You might also prohibit things like the cost of missed flights, child or pet care and travel insurance.
Using Soldo, you can make sure they adhere to these conditions. Simply give them each their own prepaid card, and add rules and limits to define where and how they can spend their money.Get started
How do I create an effective employee expense policy?
A lot goes into creating an effective employee expense policy, and we’ve put together in-depth guide which reveals just what it entails. But to get you started, here are a few key things to bear in mind:
1. Be clear
If you’re transparent from the outset, everyone will be on the same page.
Make sure your policy is concise and to the point, and laid out in an accessible way. Steer clear of jargon and corporate speak, and write it in the tone that fits your company. Even better, bring your team into the decision-making process. That way, it becomes a collective agreement, rather than a set of rules imposed by the higher-ups.
2. Be fair
Of course, this doesn’t mean you can’t be strict, and you should make it clear what you expect from members of your team. But you also have to understand that an unfair expense policy is often more detrimental than no expense policy at all.
You want to make sure that your expectations – how much employees can claim back for meals, for example, or how much they get paid for fuel – are reasonable. There’s no one-size-fits-all solution to this: certain policies may work for some companies and not for others, and it’s up to you to decide what constitutes “fair”.
3. Keep it updated
It’s no good washing your hands of your policy once you’ve written it. It’s a work in progress that needs to adapt as your business does.
This means you should revisit it every few months, and assess how your business has grown and priorities have changed. You’ll also want to keep an eye on other influencing factors, including inflation, new legislation and changing technology.
4. Use digital tools
An expenses policy should no longer be thought of as just a document. With tools like Soldo, you can make it part of the day-to-day.
By giving your team Soldo cards, you can set customisable conditions to limit how and where they can spend money. You can enable notifications to let you know when anything out of the ordinary happens, and nip issues in the bud before they become an ongoing problem.
Soldo has the added benefit of helping you learn from and about your expenses policy. You’ll be able to use a dashboard to pick up on patterns in people’s spending, and address habits that the company is getting into. You can even share the data with your accountants so they can help you shape your policy as you grow.
Frequently asked questions
There are a number of reasons to create a watertight expense policy:
- Limit costs and outgoings: Your policy makes it clear what is expected of your employees, and what they can use company cash for.
- Foster a culture of fairness: If members of your team feel adequately compensated for business costs, they are less likely to submit exaggerated claims.
- Prevent fraud: Your policy is a concrete document you can use to protect yourself if you feel employees have overstepped the mark.
Yes, you need to keep a record of all the expenses your employees have claimed for three years.
HMRC may ask to see them at the end of the tax year, and you may need to be able to refer to them if they query any of your outgoings. This means you’ll need to be able to reference the details on the receipt, including where the transaction took place, the amount it was for and the date it was made.
There are different rules for which expenses you have to report and pay tax on. You can find more information on them on the HMRC website.
Technically speaking, employers aren’t required to reimburse employees for expenses incurred in connection with their work, including travel expenses. But they are allowed to, and are even encouraged to, in the interests of keeping things fair for everyone.
Create an expense policy that works with Soldo
A written expense policy is all well and good, but with Soldo, you can take it from the page and put it into practice.
Soldo is a multi-user expense platform made up of a payment card, mobile app and web console. Together, they save you time and money at every stage of the expense management process. You’ll be able to watch payments as they happen, navigate paperwork and admin, and gain insights which you can use to make your business run more smoothly.
The prepaid card
Soldo’s prepaid card helps employees buy what they need, and gives the finance team oversight of what’s being spent.
By adding unique spending conditions to each card, you can make sure team members only ever spend what’s permitted by your policy. You can set daily, weekly or monthly limits on the amount they can spend, for example, or rules about where and how frequently they can use the cards. There’s also no limit to the number of cards you can hand out to your team.
The mobile app
Once they’ve made a payment, cardholders can take a photo of the receipt in an app, so there’s no need to hang onto them.
This means there’ll be no more disputes about unrecompensed cash if receipts go missing. Your employees will be compensated just as the policy specifies. Plus, with real-time in-app updates, they’ll always be up to date on how much they’ve spent and how much is left on the card.
The payment control console
This is where you can make sure your employees adhere to the policy you lay out for them.
You’ll be able to review every payment your team makes in real time, and then browse them by transaction type, cardholder and more. You can also add rules and limits to each card to keep them within your company’s parameters, make free and instant fund transfers to make sure they can spend what they need, and block cards if you notice anything suspicious.
But our web console does more than just increase your control.
You can also use it alongside the most popular accountancy apps, from Xero to Quickbooks, to create in-depth reports. Once you have done, you’ll be able to react to your company’s actual spending habits, and tailor your employee expense policy to fit your own business.