Expense reimbursement for employees
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What's Wave's best practice for reimbursing employees for business expenses? Does Wave have built-in functionality or a workflow that supports employees submitting expense reports for reimbursement? These expenses are incurred on an employee's personal credit card or paid out of pocket with cash. I've read the reimbursable expenses FAQ, but that use case isn't the same as what I'm asking about.
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Hi @cttcomedy.
We do have a guide on the matter! Here's how to account for reimbursements. It'll explain the whole process for reflecting reimbursements to your employees in your bookkeeping.
Hi @cttcomedy, just doing a bit of a follow-up.
Can you give us a little bit more information about your business and your employee reimbursement process? Do you have to reimburse your employees for expenses often? What kind of expense are usually at play? If we built a specific feature to make the process easier, what would you like to see from it?
I too would like to see a feature like this. My company is a construction company and at times guys will need to pick up some materials to accomplish the task. I will reimburse them for the materials, but I would like to be able to have it as a line item on their pay stub so they can see it easily.
Also, I've looked at the method linked above and it seem somewhat convoluted. I do notice in accounting under expense categories there is a category 'Payroll - Employee Expenses Paid'. I do use this for accounting purposes when reimbursing myself, but with other employees I want to have it show on their paystub and only have to 'cut one cheque' on the pay cycle, so their should be a way to add in expense reimbursements after source deductions have been calculated. Am I making sense?
Hi @JDub. You can do this already if you are a Wave Payroll user! Here's how.
Click on Employees, under Payroll, and click on the pencil next to the employee to reimburse. On that page, click on "Benefits and Deductions". From there, you'll have the option to add an expense reimbursement as a line item to a given paystub.
great, thanks. once I upload the receipt then I just add it as employee expenses paid in the accounting?
I didn't see an answer here.
I use wave payroll.
A team member has purchased a plane ticket, a hotel, some misc expenses.
I'm not clear now on what i do to take his receipts (on his personal, unrelated credit card), enter them to the system, and then have this show as a line item on his paystub (that is not taxed).
thx.
Hi, @donbowman.
My recommendation would be to create a Credit Card named after your employee and record those receipts against that credit card. This will allow you to keep track of amounts as well as keep those receipts on Wave.
Once you do your payroll, add an expense reimbursement line to your employee's paystub, as mentioned in my previous reply here. Let me know if you run into any issue!
Thanks Alexia, I will try that.
This brings up the obvious feature request. Right now the app / email receipts@ work only for me. My team can login to wave to see paystubs (but the rest of the interface is kind of orphaned, e.g. it looks like it works, but its for some fictitious 'personal' company).
I would like to allow the team to be able to email/app-in their receipts and then I can review/assign them to these 'fake' credit-cards.
since they can login to the company for waveapps, I think it should be doable, you have their email<->company info, and login auth.
Hi, @donbowman.
You can add them as collaborators to your account. To do this, go to the Settings page and find "Collaborators". Adding a user as a collaborator will allow them to see your Wave account and add and edit data as needed. They'll still be on their Personal page by default, but they'll be able to switch by clicking "Personal" in the top-left corner, and then choosing your business.
yeah, that's a bit complex as I grow the team. I really just want them to be able to push receipts as an expense, not be part of the accounting
Hi, @donbowman.
That isn't currently possible in Wave for employees to submit refundable expenses without going through the business itself. It's an interesting suggestion, however. I can see it being useful to many of our users.
Can you tell me a more about your business? Do you expect your employees to have large numbers of receipts to get reimbursed for?
There has been discussions recently about expanding how we handle collaborator permission and allowing business owners to customize their collaborators' access. Would giving your employees a collaborator access to only the receipts page (but not the ability to approve them) be enough for you?
Sure.
Large numbers of receipts? well, people travel to meet customers (so plane tickets, taxi, meals, hotels). Lets say ~4-5/week for some.
other little expenses crop up (e.g. bought this tool on paypal, bought a usb-flash to give customer a copy of presentation).
so yeah, as you get more staff, it gets more complex.
some workflow is also desired. instead of individual receipts, normally there is the concept of an expense report. The user enters them all, and it is submitted as a whole, and then approval chain.
its very common workflow for people to have their team submit expenses in arrears.
it doesn't really scale to have them directly use the accounting system (even for the pay stubs its kind of weird). You want a simple system they can enter:
[image of receipt], category, $, time
...
and then approve/reject the set, and then pay them on next payroll.
corp credit cards are not really a solution, it misses the 'sign off' step, e.g. you can't just pay them w/o looking. also some places don't take credit cards (e.g. taxis in many countries).
Thanks for following up with this information, @donbowman!
Hi Alexia,
we too are looking for some kind of expense/reimbursement/cash advance workflow for employees.
Our staff incur expenses by:
We wouldn't want staff to access our accounts but simply have the ability to make requests, upload receipts (for approval and company records) and submit expenses.
Is some other type of user role in the works? Thanks.
Hi, @mattwong.
Thanks for sharing! I'll forward your feedback to the product team!
I don't have information to share about whether or not this is a feature we're working on right now, but I can tell you that expanded collaborator roles have been suggested a lot recently, and our product team pays close attention to feedback from our users.
Hi Alexia,
ok that's good to hear. For the end user being able to separate between personal, business/es prior to syncing to a company's Wave would be super useful that way companies don't have to view or separate the personal expenses.
Anyhow, fingers crossed this is a feature in future
I've followed the instructions but I'm left with an uncatagorised transaction and I'm a bit stumped. I have zero accountign skills, but worked for a bank for a long time, so understand some basics.
Here's the situation. We're a Scout group, so deal nearly entirely in volunteers and reimbursements. No staff. We decided to purchase a 'Load&Go' Visa debit card to act a sort of petty cash: load it with value, a Scout leader goes to shops and purchases supplies for upcoming camp, the scout leader is not out of pocket and I have a receipt and online Visa statement detailing the transaction for transparency. Seems perfect? Terrific.
The Group Leader paid for it out of his own pocket to start it up and so he needs to be reimbursed.
1. I created a Credit Card called 'Reimbursement-Group Leader'
2. I created a new 'cash & bank' account called 'Load&Go'
3. Showed transactions between Reimb and L&G where Group leader opened account and loaded value on 3 occasions. (which totalled $525)
4. Showed transactions on L&G as an expense 'Camp costs' when Group Leader made 2 purchases
5. Showed transaction between bank account and Reimb of $525 when I actually transferred the reimbursement amount to the group leader.
On my P&L I have an uncatagorised transaction, on my income side, of $525. A 'created transfer'.
What category can I use here? Thank you!!
Hey @Pip. To me, it sounds like you are mostly handling this correctly in Wave (for how your business runs) which is awesome.. you know your stuff. What you would want to do is categorize the expense transaction (for the $525) as the Reimbursement-Group Leader account so that it decreases the liability. This should balance out your accounts on the reports section as expected, but if you are still running into problems, please let me know so we can look into this further.
@JamieD Ah! You know what it actually was? It was the transaction imported from my bank! I didn't recognise it because it was essentially the same details as the one I created. So, I deleted that transaction and now it's all good.
has there been any movement on this? Its been over a year since i commented.
Its exceptionally confusing for my staff since the interface they get makes it seem like they can enter an expense report, but that goes to some mystery company that is opened in their name as a function of signing up to see their paystub. E.g. when you login w/ google you get your own company, but are also an employee of mine, the interface doesn't make this clear.
failing that, is there a product you can recommend that has some integration?
its a pretty common business need out there, and a real show stopper.
Hey @donbowman
Appreciate you bringing this back up, but as it stands we currently don't see this on the roadmap for our payroll system. Our system is a little more rudimentary and meant for paying your employees and documenting their hours. It also generates the necessary tax reports.
I apologize that your issue still hasn't been addressed by our developers, but to be completely transparent I haven't heard of this coming down the pipeline for Wave's payroll system.
Regarding your employees Wave profiles to view their paystub, this is a way for our system to do two things 1) have your employee view their pay stubs, and 2) have the use their own accounting software if they'd like to start keeping track of their books.
Again our apologies that this feature hasn't yet been rolled out yet. I am not quite familiar with other software out that may do this, but it never hurts to ask around or search the web.
is there something that integrates that you recommend for expensing? its a key use case.
e.g. expensfy? Where are the Wave API documented so i can know what is integrated or possible to integrate?
also, is there any way to make is so they don't have to view themselves as their own small business owner in Wave as well as getting pay stubs? its very confusing to them (since they then fwd their receipts to their own account, and, well, it goes nowhere)
Hey again,
you can search for any of our integrations we use through Zapier here if you like! So far we haven't seen any integrations for this feature.
Regarding the business, this is not possible. If they wanted to Archive Their Business They could go ahead and do that, but they'd need a Personal account in order to view their pay stubs. If you'd like to just download it and send it to them that's a possibility of course as well under the run payroll page.
Is this the current workaround to reimbursing employees for health insurance premiums via US programs like QSEHRA? Thanks!
Hey there @OfficeJess
I've merged your question into a more appropriate thread where you might be able to find answers that help you best. You can also check out our Accounting for Reimbursements article for more info if you need! Let us know if this helps!
For those who utilize QSEHRA (Small Business HRA) as a non-taxable health insurance reimbursement benefit for employees, I received the following advice from the live online chat. The key is that you have to be signed up for Wave Payroll and their Tax Services for this to work.
The key with a QSEHRA that makes it so awesome for small business owners and employees is that neither side incurs a tax liability for it. The employee is not taxed on it, because its not considered income at the federal or state level. And the employer is not taxed on it either.
I've read through this thread on the topic of reimbursing employees. I've also read the "How to Account for Reimbursements" post. I still have a question. I created a credit card account for each employee to track expenses that need to be reimbursed, so that is a liability. I then reimbursed them through the WAVE payroll, so they got paid back. I don't know how to create a transfer or journal transaction to reduce the employee liability. Here is how the WAVE post says to do it, but that is assuming it was reimbursed from the checking account directly and not through payroll.
_Step 3
"Now, when you’ve paid Raj what you owe him, you’ll want to create a transfer from your bank account to the loan account representing the reimbursement. On the Transactions page, click Add Expense, and enter a description line. Select the reimbursement date and the total amount reimbursed. Under category, select Transfer to Bank, Credit Card, or Loan and select the “Reimbursements - Raj” account you created for this purpose."
Could someone walk me through how to create the correct transfer or journal transaction to show that the liability was meet through payroll ? Thanks very much!