Good Criteria to Be Used When Incurring Business Expenses for Travel
You’ll control your staff travel costs and avoid morale problems if you create a travel expense and reimbursement policy and include it in your employee handbook. Even if your staff members aren’t trying to slide anything by you, they might spend more money than necessary if you don’t give them a list of parameters to follow when traveling on company business.
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Require a Request
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One of the key criteria to include in a corporate travel policy is to ask employees to submit a travel budget request before they leave. They won’t know all of their expenses, but they should know where they’ll be spending money, such as on air fare, lodging, parking, taxis, meals and tips. Create a form for employees to use to request their travel budget, filling in what numbers they can beforehand, and require that they get their request approved in writing by their supervisor.
Book Staff Travel and Lodgings
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If you let employees book their own flights and accommodations, they might be tempted to use airlines and hotel chains that give them bonus points they can redeem for personal use later, rather than the lowest-cost options. You also lose travel points and credit card bonus points when you let employees book travel in their own names. Depending on your situation, have a member of your administrative or human resources staff book all travel and lodgings. Let employees submit preferred airlines and hotel chains and offer them the opportunity to pay the difference to use their choices. You can let employees book their own flights and hotels in their own names after your office has approved the arrangements if you don’t want the points to use to earn free flights and room nights the company can use later. Communicate the IRS rules regarding employees keeping free travel awards.
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Require Receipts
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It’s convenient for employees to submit a credit card statement with all of their expenses as proof of their travel costs, but statements don’t let you see what the employee actually ordered. For example, if you accept a credit card statement to verify room costs, you won’t know if that room bill included mini-bar items, movies, gift shop purchases, room service or personal phone calls. Allow employees a per diem for small amounts, such as tips or cab fare, so they won’t have to keep receipts for small amounts.
Set Meal Per Diems
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Limit the amount of money employees can spend on meals each day using a set daily amount, or per diem. Change this amount depending on the city an employee is visiting, based on the cost of living in different cities if you will be sending staff to a location you know will be very expensive.
Create a Reimbursement Form
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Make it easy for employees to submit their reimbursement request and for your accounting department to keep track of travel expenses by creating an expense reimbursement form. If you don’t request receipts, you can create an online form employees can fill out. Have each reimbursement request checked against their pre-approved travel budget request and approved by a supervisor.
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References
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