What is a business travel expense? Business travel expenses are usually incurred by an employee or company when travelling for business purposes. It can include the cost of flight and train tickets, hotel reservations and meal expenses.
But, what is a business travel expense list, and how do you control your business travel expenses? Continue reading this article to understand exactly that!
List of Claimed Business Travel Expenses in 2023
Today, the success of many businesses relies on successful business trips. Therefore, it’s essential to know and understand what to include on your list of business travel expenses, and how to deduct these travel expenses.
However, not everything can be claimed as travel expenses. Here are examples of eligible expenses that can be included:
1. Airfare or Other Transportation Costs
Everything related to transportation during a business trip can be claimed as travel expenses. This includes the costs of flight, train, bus tickets, car rental as well as parking fees.
2. Accommodation Expenses
Hotel or lodging expenses during a business trip can be claimed as travel expenses. However, it is important to know the corporate travel policy of your company. There you will find a budget and the type of accommodation that you are permitted to book on behalf of your company.
Find out why you need a corporate travel policy for your business trips.
3. Meals and Business Activities
Most business’s include the cost of meals during a business trip, particularly if you are eating out with clients / investors etc. This will also often include food bought from stores, take-out and room service if you are looking for a quiet evening.
Entertainment may well be covered, but you might expect this to be on a case by case basis. Once again, this would be more likely to be covered if entertaining clientele and business partners.
Make sure to do your research when landing in a new city. Or, draw on the expertise of a corporate travel agent if you have one!
If you are traveling to Toronto, here you can find the 10 best lunch restaurants to eat at.
4. Communications Expenses
Business travel requires a lot of physical and online communication. For this reason, business-related phone calls, mobile internet access and other communication expenses are included in the business expense list.
5. Business Events
The cost of entrance and participation in conferences, seminars or other business events is also claimed as an actual business travel expense.
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In some cases, corporate companies include the cost of dry cleaning and laundry expenses, parking tickets, business cards and even tips for hotel staff.
What Can't Be Claimed As Business Travel Expenses?
There are some expenses that can’t be claimed as business travel expenses, including:
When it comes to travel expense management, it is essential to know that personal expenses, unrelated to the conducting of your business, are almost always not covered. That means that the cost of personal entertainment, clothing or meals while on vacation can’t be claimed as business trip expenses.
If you are traveling on behalf of your company it is important to consider its expense policy, as there might be different tiers available depending on the seniority of staff members. For example, you would C-Suite Executives to have less restrictions on spending than a Junior Sales Associates.
First-class tickets, business-class tickets, expensive hotels, room upgrades etc. can be claimed as business expenses, but not by everyone! So, if you want to get the maximum refund from your work, you need to know the limits that might effect you.
Employees' Family Expenses
Accommodation and transportation of employees’ family members are also typically categorized as non-claimable expenses.
In addition, each country has its own tax laws and regulations. Therefore, you should contact a tax professional or the relevant tax authority to find out which expenses you can and cannot claim.
How To Manage Business Travel Expenses
Business travel expense management can be complicated to deal with effectively. However, there are several steps to managing business travel expenses that can make life easier! Follow these steps and you will avoid incidental and non-claimable expenses during your next business trip.
Set up a budget
Before the trip, establish a budget for the expected business related expenses, and try to follow it as much as possible. Remember, your expenses must be ordinary and necessary.
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Keep a Receipts
For better expense management we recommend keeping and collecting all of the receipts you receive during the trip. You will need them for the reimbursement process, or the tax deduction process.
Use Expense Management Software
To track and manage business travel expenses, many companies use an expense tracking and management software. With the help of expense reporting programs or services, employees can easily submit expense reports and managers can review and approve them more easily.
Use a Corporate Credit Card
If your company provides you with a credit card for business expenses, use it to cover all your business travel expenses. This will make everything much less complicated, as you won’t have to settle up at the end. However, you won’t be earning points on your own credit card whilst away.
Use a Rewards Programs
Take advantage of rewards programs offered by hotels, airlines and corporate travel companies to earn points or miles that can be used for future travel.
Track Your Expenses Regularly
Keep track of your corporate travel expenses regularly, so that you can adjust your travel costs and spending if necessary.
Plan your trip as early as possible. This can help you avoid last-minute bookings, which can be more expensive. Additionally, it’s important to remember that business travel expenses must comply with company policies.
Use a Corporate Travel Agency
Partnering your business with a corporate travel agency can streamline the entire expensing process, from helping you build your corporate travel policy and planning your corporate trips, to restricting unnecessary spending by enforcing your policy.
Take a look at our list for the 7 best corporate travel agencies in Canada.