Expenses and claims: stop keeping receipts in your pocket

Hook

Boss, where are last month's receipts right now? In your pocket, in the car, in a drawer, somewhere in WhatsApp. Looking for a receipt at month end turns into archaeology. Today we cover how to manage expenses and claims: where the receipts come from, when to record them, and how a claim should work. You will be able to use all of it straight away.

Two routes first

When the company spends money it goes down one of two routes. The first: the company pays directly — shop rent, utilities, supplier payments, straight out of the company account, receipt into the books, clean and done. The second: somebody puts the money up first — the boss entertains a client on his own card, a staff member buys stationery for the office out of pocket. That route is the claim. Almost all the mess lives on the second route.

Receipts come from four directions

A receipt has not been just a piece of paper for a long time now. Some sit in email — TNB, internet, insurance, all billed into your inbox. Some have to be downloaded from an app — telco, bank and platform statements. Some are still paper — the kopitiam receipt, the parking slip. And the payment methods are just as scattered: Touch 'n Go, bank transfer, card, cash. Four sources, one principle: all of it goes to the same place. Emailed bills get filed into one fixed folder, app statements get downloaded every month, paper gets photographed on the spot and never left overnight. If the receipts are not complete, the accounts cannot be complete — and "complete", from the first lesson, starts right here.

The rhythm of recording

Once the receipts are in, when do you record them? Two kinds. The fixed monthly costs — rent, utilities, phone, insurance, instalments — those commitments come round every month and the amounts do not run away. Make a checklist, reconcile it once at the start of the month, record each one as it arrives; that is the least work. The ad-hoc spending — buying materials, entertaining, running errands — is best recorded the same day, and cleared within the week at the latest. Why? Because a month later you will not remember what that money went on. The worst case of all is leaving it to year-end: half the receipts lost, memory a blur, and an all-nighter of archaeology before the filing deadline. Remember the rhythm in one line: fixed costs monthly, ad-hoc spending daily.

The rules of a claim

When the boss puts money up himself, the usual ending is that he forgets. Your money is gone and there is no expense in the books. You lose twice: the money was spent for nothing, and the company under-records an expense, so the tax you should have saved is not saved either. When staff claims have no rules, the problem runs the other way: everything gets claimed, and who approved it and whether there was a receipt is anybody's guess. Write one set of rules for the whole company. What can be claimed — money spent for the business, the line from the third lesson. Who approves — one fixed person. When it is paid — a fixed cycle, paid once claimed, nothing carried into the new year. And in the e-Invoice era, when you take a bill from a supplier, remember to give the company's details, not your own name.

To close

Manage the receipts and the expenses get recorded in full; record the expenses in full and the statements come out right, and you stop overpaying tax. Next lesson takes the other end of the money: the invoice is out but the cash has not come in — receivables and payables, how to chase them and how to manage them. I am LTT, helping SME bosses get their accounts straight. Follow us, and see you next time.