The expense claim function in Xero can be used to record the reimbursement of a business purchase paid for by an employee. This process can be divided into a 3-part procedure:
- Submitting the claim
- Approving and authorising the claim
- Paying the claim
Please see the video below or follow this link, which provides an overview of using Expense Claim in Xero:
For the transcript and more details:
Submitting the claim
Claims can be recorded by any user in Xero with a permission other than Read Only. Note that users cannot submit a receipt on behalf of another individual (this can be done however, with the “New Expense Claims feature” being tested by Xero).
To submit a new claim:
- Navigate to Accounts menu > Expense claims > + Add Receipt.
- Fill in all the details regarding the expense claim (all fields must be filled)
- Note “receipt from” refers to the receipt issuer, not the employee claiming the expense.
- Attach an image of the receipt by dragging the file into the browser page or clicking the file button and then "+ Upload files".
- Save the receipt.
- The receipt will appear under in the Expense claims page under ‘Current Claim’ and can be edited by clicking into the receipt.
- When a claim is ready to be submitted for approval, in the Expense Claim page click the checkboxes to the left of the relevant receipts then select ‘Submit for Approval’.
- You can view the claims you’ve made as well as their status and payment date in the previous claims tab in expense claims.
Approving and authorising the claim
Once the claim has been submitted it can be reviewed by a user with the Adviser, Standard, Invoice Only + Approve and Pay, or Invoice Only + Purchases user role.
To approve a claim:
- Navigate to Accounts à Expense claims à Awaiting Authorisation.
- The page will show a list of all the claims awaiting authorisation.
- Click on a claim to examine the receipts in the claim. You can further click into a receipt to review and edit its details.
- When satisfied, approve or decline the claim. You can partially approve a claim through approving and declining each receipt individually.
- Authorise the claim by entering a payment due date and reporting date.
- Payment due date: date of expected payment to employee.
- Reporting date: date the receipt transaction will be recorded in your accounts.
- Once authorised, the claim moves to the Awaiting Payment tab.
- If you’ve accidentally authorised a receipt you don’t want to authorise or want to edit the details of a receipt, you will need to void the claim by navigating to awaiting payment tab, click on the claim then click on the “void expense claim” button. You’ll then need to re-enter the receipts
Paying the claim
To record payment of the claim and reconcile the reimbursement:
- Navigate to Accounts > Expense claims > Awaiting Payment
- Click on the claim that has been paid
- At the bottom of the claim fill in the dialog boxes “Amount Paid”, “Date Paid”, “Paid From” and “Reference” then click “Paid”. A spend money activity is recorded in Xero.
- Note that the paid claim moves to the Archive tab.
- When reconciling your bank statement lines, the payment to employee can be matched to the spend money activity recorded when the claim was paid.