The thought of monitoring employees' travel expenses makes you sick? Believe us; it is not as hard and tiring as you think! Finom services are here to help!


Travel expenses can be hard to manage, especially when you come to realize that, except for food, accommodation, and air tickets, there are plenty of other things to pay attention to. When employees don’t keep track of your company’s money on a business trip, unwanted consequences for the company as a whole are inevitable. How should you deduct actual expenses? 

In this article, we will talk about what can be considered a business travel expense and what can’t, and give you some advice on how to manage the budget.

What Is a Travel Expense for Business?

When an employee has a work-related trip from their tax home, everything from food and tolls and parking fees to airfare can be considered expenses incurred for the sake of work. Any company must have a clear travel expense claim policy. Usually, to claim a business traveling expense, a worker must provide receipts for any activity that helped them conduct a work task. Travel expenses can be claimed for:

  • Bus, plane, or train tickets. It is usually allowed to claim transport expenses (public transport or the employee’s own car) for business purposes, except for when an employee commutes from home to work and vice versa. It is possible to claim expenses when a worker has to rent a car (or travel on their own) to travel between several locations (offices, events, meetings).
  • Accommodation. Of course, a 5-star resort hotel is not a travel expense if your company can’t afford it. The place your employee chooses to stay overnight should be reasonably priced.
  • Food. When an employee is away for longer than a half-day, it is necessary to include 50% of their food costs as travel deductions.

These are the three main cost items. However, don’t forget about the following additions:

  • Fuel costs if an employee travels in their own car
  • Highway tolls
  • Luggage fees (for example, at airports), if this luggage is necessary for business
  • Wi-Fi
  • Laundry
  • A business meal
  • Business calls
  • Other expenses related to business

The list is not comprehensive; you need to talk with your employees about it beforehand and make sure they understand the rules.

What is Not a Travel Expense

A number of common travel expenses can’t be deducted. First of all, if the worker’s family accompanies them on their business trip, their expenses can’t be refunded. Commuting to a usual workplace, private travel, any additional stops on the way (if your employee decides to visit his grandma living “just” 20 km away from his business destination - that’s on him), travels to other workplaces (not yours) - anything like this is up to your employee to pay. 

If your employee has to travel around the city for business matters during working hours, expenses may be deductible, but they can’t be called travel expenses. 

Finom Business Account and the Perks It Offers

Finom is here to help you organize and monitor the expenses for travel your employees have. Via the Finom application (Finom for Android, Finom for IOS), you can issue virtual and physical debit cards for your coworkers with the requested limit and block them instantly if necessary. Your employee can upload photos of receipts of any transaction, so that the expense will be provided with a confirmation. Any transaction can be named, so you can see the entire business expenses for the trip.

With business access, it is possible to invite your team to access your account safely. Here are some key benefits for small business organizations:

  1. Online banking
  2. Invoicing services - pay all invoices with one click
  3. Analytic data reports
  4. Cashback of up to 3% for expenses
  5. Virtual cards are free of charge and can be controlled via the Finom application within minutes
  6. You can set different money limits for each employee individually
  7. All the transactions are shown on the Finom dashboard. They can be categorized and filtered for quick access
  8. Automatic reconciliation of receipts
  9. Tech support answer time is less than five minutes.

Finom tips: How long does it take to open a business account with Finom?

How to Manage Travel Expenses Efficiently

Not to create chaos and keep track of money spent during business trips, it’s best to think about how you are going to monitor an employee’s expenses beforehand. Don’t let these things slip your mind:

  1. What the payment method is.

Here are two ways of dealing with a situation. You can either issue a special card for your coworker, so they can pay directly from a company bank account, or you can ask your coworkers to use their own cards and then have them claim all the money spent later. The second option requires lots of time, so it’s easier to go with the first one.

  1. Ask your employees to project expenses before they set off, so they can plan their spending.
  2. Don’t forget to state in which form evidence must be provided (physical receipts, PDF invoices, photos).
  3. Travel expense claims must be submitted within 5 working days of the business trip.
  4. Use expenses management software. Studying expense claims by yourself is really time-consuming. It’s easy to miss or forget something.
  5. Have a clear expense policy and ask your employees to get familiarized with it in order to prevent spends not related to work. Set a meeting before the business trip and explain all the rules once again. It’s crucial for your employee to have a clear picture of the rules and to understand that they must follow them.
  6. Tag each expense.
  7. Analyze the budget of the business trip once it has finished knowing how much you need for the next one.
  8. If you are not satisfied with the cost of a business trip, try to understand why it is so big. Maybe it is better to buy flights from low-cost airlines, book hotels well in advance, collect bonus points and become a member of some loyalty programs. You may also ask your employees to use buses and shuttles from airports, not taxis.
  9. Don’t forget to claim tax returns (VAT).

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All in all, if you value your time and have other important things to do, the best option for you is to use special software for monitoring the business travel expenses of your employees. It saves time and protects you from mistakes. Moreover, it helps plan the budget for the next trip. Before you ask your employee to take a business trip, make sure they know the rules and understand which travel expenses can be claimed and deducted and what can’t be refunded.

Have a good and productive business trip!

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