Expenses management is currently so lax that many firms have no written rules and less than 2% of expense claims are investigated, despite this being a HMRC requirement. WebExpenses expense management service helps you audit an array of claims across a travelling workforce, incurring costs in different contexts, through different payment methods and currencies.

2.  The HMRC was given a £900 million to close the tax net around
expenses cheats in 2010
 However, a round of spot-checks on businesses found that 40%
still have “issues” with record-keeping
 That could be the just the tip of the iceberg
 Tax inspectors plan new “flash inspections” of 12,000 company
records in the next year

3.  Expenses-management is currently so lax that many firms have no
written rules and less than 2% of claims are investigated, despite this
being a HMRC requirement
 Many firms cite red tape as the biggest roadblock to growth
 Auditing an array of claims across a travelling workforce, incurring
costs in different contexts, through different payment methods and
currencies, is also prohibitively expensive for SME’s
 A staggering 63% of small firms spend more time managing
expenses than generating new business

4.  Complying with a dense thicket of tax rules is leeching vital
pounds and hours from the business
 Yet a failure to keep proper records could cost even more, in
fines, interest and tax repayments
 However, there is a loophole; the HMRC says it won’t target
companies that have “adequate procedures in place” to prevent
fraud
 And those businesses that implement strong expense policies, will
find huge tax rewards are just around the corner

5.  Red tape is the biggest obstacle to transparent and efficient
expenses-management
 Storing and sifting a mountain of paper receipts, then manually
entering everything on a spreadsheet, is not only heavily labour-
intensive, but likely to lead to dangerous oversights
 Businesses need to move towards electronic claims and receipts
which eliminate the need for paperwork, and seek to automate as
much of the expenses-management process as possible

6.  Lost receipts cost businesses millions of pounds a year in
unclaimed tax
 Electronic receipts eliminate the risk of error at both ends –
1. Employees no longer need to carry receipts, but can enter
claims and evidence as soon as costs are incurred
2. Finance Departments no longer need to file claims and
receipts, as they are automatically stored online, instantly
available to tax inspectors

7.  With costs now incurred on everything from personal cards to
Tablets and mobile travel sites, businesses need to speed up and
integrate the whole expense-management process
 Now , a claim entered anywhere, through any method, can be
remotely monitored and checked
 Companies should take full advantage of the global connectivity
provided by the internet, enabling spending details to be uploaded
from anywhere and viewed in real-time from a remote office

8.  If fraud is discovered, it is vital that businesses show tax inspectors
that they attempted to enforce the rules, by informing employees of
the law and checking claims for compliance
 Sometimes false claims are simply the result of errors, and
businesses can easily reduce this, by notifying employees of incorrect
claims at point of entry
 Businesses should make policies instantly accessible from anywhere
 Staff should be encouraged to send electronic claims through email or
SMS, use phone cameras to snap receipts, upload card details
online, or take screenshots of online booking forms

9.  Travel is the single biggest expenses item, and exaggerated
mileage is both the most common type of expenses fraud, and
the easiest to combat
 Businesses must end their dependence on employee travel
“estimates” and overworked admin staff
 Satellite mapping now provides postcode-to-postcode verification
of each employee journey, while software can automate the
process of checking every business mile against tax policy
 Companies should combine mapping with Pre-Trip Approval to
plan tax-compliant journeys in advance

10.  No expenses management system can eliminate human
dishonesty entirely, but employers can foster a transparent and
fair business climate which discourages excess and promotes
prudence
 Finance Departments must enforce expenses rules fairly across all
departments and tiers of employee
 They should reward honest employees, while openly punishing
excess
 If the system is seen to be fair, staff are less likely to falsify
claims

11.  There are some advantages to the complex rules that face the
typical company
 If your key staff are aware of the rules and tax legislation that
exists then they can make the system work for them
 These rules can change in subtle ways and the increasing desire
for government to raise tax revenues will mean that it could be
easy for companies to fall foul of an ever changing tax landscape
 Expenses and benefits training is key to ensuring that the right
staff are aware of the changing sands of tax compliance

12.  Businesses that successfully differentiate between tax-exempt
and taxable expenditure, will both avoid fines and reap massive
tax rewards
 There are tax deductions on everything from “incidental
expenses”, to “travel costs” for a relocating employee’s family
 And if businesses instantly pay the correct amount on tax for each
item, in each context, they will avoid interest on late payments
 Take advantage of software which can automatically differentiate
between the complex HMRC definition of “business” and
“recreation” in every context, and pre-plan whole trips around
maximising tax relief

13. To stay connected with WebExpenses,
Find Us On –
Google+
LinkedIn
Twitter
Facebook
YouTube