The topic of travel expense reporting is a vexing one, and not just for employees who travel frequently for business. Manual and paper-based effort, long Excel spreadsheets and complicated verification processes make business travel tedious even for accounting teams. However, to minimise the administrative burden of frequent business travel, there is a simple and effective solution for companies to use: Travel expense software.
A digital tool can help manage travel expenses and, along the way, offers numerous interfaces to simplify complex and time-consuming processes.
A fundamental requirement that many employees continue to struggle with, despite software and simplified processes when it comes to travel expenses, is the fact that they usually have to pay in advance for business trips and lay out the money for the travel expenses. One solution to this, at least with regard to travel costs incurred, can be a mobility budget granted by the employer, which employees can use for their journeys on business trips.
What are the advantages of a mobility budget for employee mobility and business trips compared to classic travel expense accounting based on the reimbursement principle?
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In a travel expense report, employees summarise all costs incurred in the course of a business trip. These include, for example, travel costs, accommodation costs and additional meal expenses. The receipts for these are collected and recorded by the employee on the business trip and the costs are reimbursed by the employer after verification. A travel expense report does not have to comply with formal or legal requirements. As a rule, employees prepare the travel expense report themselves and submit it to the employer. Depending on the company, the process of internal accounting differs; many companies now use special software or online tools for travel expense accounting.
Business trips include travel to project meetings, customer visits, trade fairs, conferences, further training or other out-of-town professional appointments. The duration of a business trip can vary, sometimes including an overnight stay or lasting several days. The trips may be to another state or even country, or only to the nearest city.
There are no uniform guidelines for business trips, which is why every company handles business trips differently. Many companies define travel policies that apply to all business trips and provide guardrails for business travel expenses.
On business trips, various cost items can arise for the company and the employees. Proof of the individual costs incurred must always be submitted for the travel expense claim. The following costs can generally be incurred on a business trip:
This list shows: travel expenses quickly cause a great deal of administrative work in companies, especially if they still traditionally work with paper and Excel lists.
In this article, we will limit ourselves to the travel costs of a business trip.
If employees undertake journeys for business purposes away from their usual place of work and outside their own city limits, they can deduct these travel costs for business trips. However, if employees travel to a meeting with clients or business partners in the same city, this is not considered a business trip and therefore cannot be claimed as travel expenses in the tax return.
However, daily travel between the employee's home and their usual place of work can be deducted from tax as income-related expenses using the commuter allowance. The commuter allowance, which incidentally applies to both pedestrians and cyclists, amounts to a maximum of 4,500 euros per year. In comparison, travel expenses allow for the deduction of higher costs.
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With traditional travel expense reporting, employees usually have to pay in advance, lay out the money for the expense items and claim reimbursements from the employer. With a mobility budget, they could receive a budget from their company in advance and pay with it, simplifying the whole process.
To illustrate the differences between a mobility budget and a travel expense claim, let's look at some key factors:
A mobility budget offers financial relief, flexibility and more efficient administration, which increases employee satisfaction while reducing overall costs. Companies should consider this innovative approach not only to optimise their employee benefits and compete for talent, but also to make business travel more convenient for employees. The mobility budget is not only a modern solution, but also a key to successful corporate mobility management in the future.
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