The Income Tax Act describes three categories of expenses that employees can have reimbursed by their companies. In addition to orders placed on behalf of the company and expenses incurred to fulfill an order, this also applies to business trips. Whether it's a business trip lasting several days, a meeting with a distant customer or a trip to a trade fair - business trips are part of everyday life for many employees. In the following article, you will not only learn what a travel expense report is, but also receive valuable tips on how to create one.
Companies often carry out a cost-benefit analysis of business trips to ensure that the expenditure is justified.
What a travel expense report is
A travel expense report is a structured report that lists all costs incurred during a business trip. It serves to ensure that employees are appropriately reimbursed for their expenses and that the financial expenditure for business trips is transparent and traceable.
In this process, the employee records all relevant expenses. These costs are then reviewed, usually by the company's accounting or controlling team. If they comply with the applicable guidelines, the employee is reimbursed the eligible costs.
Why you should create a travel expense report
Many companies have clear guidelines that stipulate travel expense accounting after business trips. But even if such regulations do not exist, there are good reasons why it still makes sense to prepare an expense report. Both employees and employers benefit from this.
For employers accurate travel expense reporting is not only important to comply with tax regulations, but also to keep track of expenses and identify potential savings. Detailed accounting allows companies to better understand how much money they are spending on business travel and where there are opportunities for optimization.
Also for employees there are advantages to preparing a travel expense report. Although you can claim the costs of a business trip as income-related expenses in your income tax return, this only reduces your gross annual salary. Reimbursement of expenses by the employer is therefore often the more economically sensible option.
Employees record their expenses in the expense report and submit them for reimbursement.
What costs you can be reimbursed for after a business trip
During a business trip, some costs may arise that can be divided into four types of costs: Additional meal expenses, accommodation costs, travel costs and incidental travel costs.
Additional meal expenses
Additional meal expenses are reimbursed tax-free and are defined by the statutory travel expenses guidelines. An important note here is that the amount of reimbursable costs for trips abroad can vary depending on the destination country.
Clear rules apply to domestic travel: If employees are traveling for at least 8 hours, the flat-rate payment amount is 14 euros. If the trip lasts at least 24 hours, this increases to 28 euros.
Accommodation costs
Accommodation costs include expenses such as hotel stays or the rent for an apartment during business trips. There are different ways of accounting for accommodation costs. Some companies use a flat rate per overnight stay, while others prefer to bill on the basis of receipts.
An important special feature in the billing of accommodation costs is the personal contribution for breakfast and other meals. A fixed amount is often set for this, usually EUR 5.60 for breakfast and EUR 11.20 for an evening meal. These amounts are borne by the employee and must be taken into account accordingly in the travel expense report.
The hotel is often selected according to the company's budget and the applicable guidelines for business trips.
Travel costs
Whether on land, at sea or in the air - travel expenses are an essential part of the travel expense report. You can claim these as soon as you travel by a means of transport other than a company car, such as by plane or train. You will be reimbursed for outward and return journeys as well as journeys to your destination and, under certain conditions, journeys home in between.
Travel costs are usually calculated using either a flat rate per kilometer or a kilometer rate. The mileage allowance is a fixed amount per kilometer driven and is often used for private or rental cars. Alternatively, you can use a mileage rate that takes into account the actual costs per kilometer, such as for cab rides.
Incidental travel expenses
In addition to the major costs of a business trip, there can also be smaller expenses that are often overlooked - incidental travel expenses. However, you should also take these into account in your travel expense report. These include, among other things
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- Parking fees
- Tolls
- Ferry costs
- Costs for business telephone calls
- Claims for damages in the event of a traffic accident
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- Tips
- Baggage fees
- Fees for lockers
- Tickets for professional events
- Theft of professional property
Incidental travel expenses also include charges for the use of highways or other toll roads.
Costs that are not reimbursed
However, there are also costs during a business trip that you are not allowed to have reimbursed. These include fines for traffic violations or other offenses as well as costs for additional amenities in the hotel such as the use of the minibar or pay TV. Charges for additional luggage that you do not need for business purposes also fall into this category.
Overall, you may not include any personal expenses or additional services that are not incurred as part of the business trip in the travel expense report.
Mandatory information in a travel expense report
A correct travel expense report requires certain information that must be included. To avoid errors, queries and delays in the reimbursement of travel expenses, you should ensure that you provide all the necessary mandatory information in your statement. This includes
- Name of the business traveler (with employee number if applicable)
- Date including time of start and end of the trip
- Trip duration
- Reason for the trip
- Destination of the trip
- Signature of the traveler
How you can create a travel expense report
Many people use an Excel template for their travel expense report - but that doesn't have to be the case! A more intuitive and clearer travel expense report template is available from SeaTable, for example. Let your employees submit all expenses and receipts digitally via web forms. The data is then automatically and neatly sorted in a spreadsheet so that you always have an overview and can regularly reimburse your employees for all expenses.
You can find more information about SeaTable's travel expense report template here.
Simply register for free with your e-mail address, try out SeaTable and customize the template according to your wishes to record the displays in your company the way you want!
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