If your employees travel for work, your admin and finance team is no stranger to corporate travel management. However, when the records get overwhelming, even the most seasoned finance and admin team can get stressed out. Check out these tips on seamless business travel and expense management.
What Is a Business Travel Expense?
A business travel expense is the expense that an employee has incurred on a business or work-related trip. This could be expenses on necessities such as meals, transportation and accommodation. A business travel expense is reimbursable when the employee makes an expense claim.
It’s important to note that a business travel expense must be done in the context of work or business. It has to be incurred for the purpose of doing work for the company or organisation.
What Can Be Considered a Business Travel Expense?
Just because you purchased something during a business trip doesn’t mean that it’s automatically a business travel expense. Here are the expenses that can be considered:
1. Meals
Meals eaten during a business trip should be considered a reimbursable business travel expense. Just be sure to indicate the budget on the corporate travel policy so that the employees won’t end up having an unreasonably expensive meal.
2. Transportation
Transportation expenses in the corporate travel policy include airfare, bus tickets, train tickets, taxi and Uber fares and cost of fuel. To avoid any misunderstandings with travelling employees, be sure to also outline the policy for transportation. For example, they can only avail of economy class plane tickets, or perhaps fuel costs are only limited per day.
3. Accommodation
When you manage corporate travel, one of the most important things to know is if the employee will need to stay overnight at the location. If they do, the hotel room (or Airbnb) should be a business travel expense. There can also be a per-night accommodation allowance.
As usual, the policy must be clear, so it must specify the accommodation or room type that the employees can book.
4. Healthcare and travel insurance
Companies must look after their employees at all times, so healthcare and corporate travel insurance are considered business travel expenses. Allow employees to claim medical and insurance expenses that they incur while travelling for business.
5. Incidental expenses
Incidental expenses such as phone costs, laundry and parking fees may arise when an employee is travelling for business. As long as these are justifiable and recorded in the business expense policy, they can be considered business travel expenses.
How Can We Seamlessly Manage Business Travel Expenses?
Travel and expense management requires diligent tracking and policy-making. Here are some tips to help you seamlessly manage corporate travel:
1. Have a clear corporate travel policy
The secret to properly managing business expenses without misunderstandings is to have a clear corporate travel policy without any room for employees’ personal interpretation. Communicate the policy well by making it as detailed as possible. Indicate the budget on specific categories such as meals, transportation, accommodation and incidental expenses.
With a clear and standardised corporate travel policy, you must also be sure that your employees are aware of it. Inform your employees about the policy and share a copy with them whether or not they will be travelling. Make it easily accessible to all employees, and remind employees who are about to go on a business trip to review the policy before they leave.
2. Categorise expenses
Seamlessly track your employees’ expenses by categorising them. Sort them according to their nature—meals, accommodation, transportation, etc.—so you can have a quick view of how much was spent on what. Remind your employees to refer to these categories when they file for reimbursements.
3. Set a timeline
Set a timeline and encourage employees to book ahead because booking too close to a trip can be more expensive. For example, set a timeline wherein domestic trips must be booked one month in advance while international trips must be booked two months in advance, wherever possible.
4. Issue virtual cards
It’s always easier when there’s a specific mode of payment that employees must adhere to. Issue virtual cards so you can track and manage their expenses even while they’re travelling.
One of the best things about virtual cards is that they’re configurable, which means you can manage how each card is used and you can prevent fraudulent activity. Plus, you can quickly freeze/block it if it gets compromised.
5. Automate the process with business travel expense software
It’s easier to manage corporate travel when it’s automated. In just one app, you get to see daily trip data, match receipts and approve claims.
More examples of what you can do with business travel expense software include:
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- Get trip details from a daily feed from your travel management company so your employees won't have to keep receipts
- Receive complete travel details such as booking number, trip itinerary and reason for travel
- Match trip data to the employee and expense records
You no longer have to spend countless hours manually matching each transaction with a receipt and an employee. An automated business travel manager can help with daily trip data and receipt matching.
Business travel expenses are a significant cost for any organisation. While business travel expenses may sound like they’re too much to handle, managing these doesn’t have to be daunting at all. As long as you have a robust policy, a clear understanding of the process and the right tools and software, you’ll see that corporate travel management is as seamless as any other operation you’re used to.
