Staff Expense Claims

Expense Reimbursement Policy and Procedures

It is College policy that members of staff be repaid the actual cost of expenses incurred exclusively and necessarily in the performance of activities related to their employment at St Chad’s College. Given that the College is a Church of England Foundation, expenses incurred by staff on behalf of the Church are generally also eligible for reimbursement so long as the claimant is representing the College.

Throughout this policy, the term ‘staff’ includes anyone authorised by the College to incur expenses on behalf of the College, whether he or she is on the payroll or not.  For instance, Governors and Honorary Fellows are required to follow the same reimbursement  procedures as salaried-staff.

In general, for domestic expenses, reimbursement will only be made on completion of the appropriate claim form which must be accompanied by receipts or invoices.  Normally, expenses should have been approved prior to being incurred.  For foreign travel, the choice of a receipts-based claim or the per diem claim system should also be agreed prior to travel.  Claims should be made within the financial year they were incurred.

Where expenses are incurred in foreign currencies, the amount should be converted either at the exchange rate applying on the date of the claim or at exchange rate when the amount was charged to your credit card or when currency was exchanged. Reimbursements will be made by BACS in most cases unless the sums are small enough for the petty cash system to be used.  It is essential that all claims be completed fully with details of the purpose and nature of the expense as well as the date the expense was incurred.  Once completed, all claims must be signed by the claimant and forwarded to his or her line manager, who will in turn seek the appropriate authorisation.

A brief description of the nature and purpose of the expense should be shown in the ‘detail’ column of the form.  For example, claims for subsistence must show details of the journey for which a claim has been made.  Failure to report sufficient details may result in claims being returned for completion.

CREDIT CARDS

Expenses incurred via use of College-issued credit cards must be reconciled by the user, who must also assign a nominal code for each item of expense. A brief indication of the reason for each expenditure ought also to be provided on the reconciliation form.  Expenses paid via personal credit cards may also be reimbursed, but their use generally requires the submission of the original receipt (or delivery note) unless the expense is clearly recorded on the credit card statement and is unambiguously a legitimate College expense.  All credit card reconciliations must be approved by line managers.

The use of credit cards for internet purchases is now the primary use of most cards. Because of the need to prevent fraudulent claims, the College may require further verification of any expenditure or proof that the item or service procured was actually received and procured for the benefit of the College. Where possible, invoices or receipts ought to be kept for verification purposes even though they are not required to be submitted with the reconciliation form.

ACADEMIC EXPENSES

Academic and academic-related staff may apply to the Principal for grants to help pay for approved research expenses.  Mentors/Tutors are also eligible to apply for such grants (chiefly to defray travel costs) through the Principal’s discretionary fund (though departmental sources of funding should also be explored); academic-related expenses for other academic staff are drawn from the Professional Development budget.  Financial help for travel during extended sabbaticals is negotiated separately, again with the Principal (or, in the Principal’s case, with the Chair of Governing Body).

TRAVEL EXPENSES

As noted above, the College will reimburse expenditure incurred when working on behalf of the College (including research-related travel). It is acknowledged that both official and research-related travel often involves personal elements; thus the College may ask for evidence that care was exercised in separating personal from official expenses.  For the avoidance of doubt, ‘expenses incurred exclusively and necessarily in the performance of activities related to their employment at St Chad’s College’ does not mean that mixing official and unofficial matters during travel precludes reimbursement.  It does, however, mean that not all expenses incurred while travelling are eligible for reimbursement.

TRAVEL EXPENSES (domestic)

Staff members who are working away from the College (i.e. more than 5 miles from their normal place of work) are able to claim subsistence under the following circumstances:

  • The cost of a breakfast meal when away on College business and when business necessitates an early start (i.e. before 8 am) to a maximum of £10;
  • The cost of lunch when away from the normal place of work over the lunch period on business to a limit of £10; and
  • The cost of evening meals when staying away from home overnight on college business to a maximum of £25.

A subsistence scale for routine travel to London (or to other destinations over two hours distance from College) has been agreed by the College.  If the travel is over 12 hours, then a rate of £28 (£6+£7+£15) may be claimed without providing receipts (these rates are subject to verification via sampling according to HMRC rules). A valid receipt (or other evidence) must accompany any other claims for domestic subsistence, and details must be shown of the business meeting, date and/or places visited.

Mileage rates for college-related travel are according to HMRC rates:

From 2011/12 First 10,000 business miles in the tax year Each business mile over 10,000 in the tax year Cars and vans 45p 25p Motorcycles 24p 24p Bicycles 20p 20p

5p per passenger per business mile for carrying members of College in a car or van on journeys which are also work journeys for them.

Domestic Rail

Unless travelling with non-College colleagues (on official business) who are entitled to travel first class, all College staff and Governors will be reimbursed at standard class rates (though first class may be booked when it is cheaper than regular standard class rates).

Domestic and European Flights

All flights within Europe must be economy class.

TRAVEL EXPENSES (foreign)

The College reimburses reasonable College-mandated foreign travel expenses either on a receipts-basis or on an HMRC per diem basis.

Air travel must generally be booked at economy rates, unless otherwise authorised by the Chair of the Governing Body or by the Principal.  For longer overseas flights, premium economy or business class may only be booked when authorised ahead of time by the Chair of the Governing Body or by the Principal.  Such authorisation will rarely be given unless the premium rates are heavily discounted (e.g., they fall within the general price range of economy flight tickets).

HMRC have issued detailed guidance regarding the use of per diems including the following:

Rates are intended to represent expenses that employees actually incur during a period spent in a foreign country. Although receipts need not be submitted when expenses are at or below HMRC rates, they should generally be kept when possible for verification that the travel actually occurred.

Rates include:

  • A 10-24 hour rate. This is intended to cover the total cost of meals in a period of 24 hours plus the cost of daily travel
  • An over 10 hour rate, which is intended to cover subsistence expenses for any period of more than 10 but less than 24 hours
  • An over 10 hour rate, which is intended to cover subsistence expenses for any period of more than 10 but less than 24 hours
  • An over 5 hour rate, which is intended to cover subsistence expenses for any period of more than 5 but less than 10 hours

The hourly rates have to be measured by reference to the times of arrival at and departure from the foreign country.

The College would expect the 10 hour subsistence rate to be deeply discounted depending on where the time was spent (i.e., in an airport).

Please note that the type of per diem you can claim depends upon the type of accommodation you stayed in:

  • Hotel accommodation will be reimbursed only up to the HMRC rate.
  • If you stay as a guest of a family, a friend, a colleague or a business/institution, then HMRC guidance is that the rate should only cover your actual subsistence expenses.  Thus, if your hosts are providing room and board, you may claim 10% of the subsistence rate without receipts, or up to 50% of the residual subsistence rate with receipts if your guests are supplying your meals (i.e., to pay for a meal for your guests in lieu of paying for your stay). You may, however, charge up to 100% of the residual subsistence rate if you are being provided only with accommodation.
  • If you stay in accommodation, whether rented or otherwise provided by yourself or by others, which includes laundry and or cooking facilities, then the HMRC residual subsistence rate may be charged for the first week and eighty-percent for the second week .  For stays lasting longer than two weeks, a maximum of 50% may be charged for the third and subsequent weeks.
  • If you stay in foreign accommodation where no rent is charged, a per diem charge of £25 for accommodation will be deemed reasonable.
  • If you stay in vacant accommodation provided by others and are not responsible for any residential charges (say for utilities, cleaning), then you may charge 80% of subsistence rate for the first week and 50% for subsequent weeks without receipts. If your costs are higher, then receipts are required for tax-free reimbursement at that rate.

To see the current per diem rates please visit http://www.hmrc.gov.uk/employers/wwsr-oct10.pdf

    Sample HMRC subsistence rates:

    Canada (Toronto & environs) (2010)

 

  • Room $CAD 208.50 (£115) per day
  • Residual $CAD 140.5 (£78) per day

 

 

South Africa (Eastern Cape – based on Pretoria rates) (2010)

 

  • Room RAND 950.50 (£ 55) per day
  • Residual RAND 326 (£19) per day

 

 

    France (Paris) (2010)

 

  • Room 188 euro (£156) per day
  • Residual 110 euro (£91) per day

 

Please note that per diems are not available for all countries/cities, so the HMRC tables should be checked for availability before claiming a per diem. The rates shown are the maximum permitted; the College may set its own rates below these maxima if the relevant budgets cannot meet the full allowance.  At all times, of course, individuals may, and are encouraged to, claim for less.

If hiring a car is necessary, then the ‘hotel to office’ portion of the subsistence rate should be subtracted from the HMRC residual rates unless public transport is also used.  Receipts for the car hire and for petrol should be itemised for reimbursement separately.  When the cost of the car hire is greater than the ‘hotel to office’ rate, the increased cost must be justified by the nature of the business conducted and the need to travel (say to offset higher hotel costs).

Members of staff are expected to exercise reasonable restraint when incurring expenses on overseas business on behalf of the College.  When claiming on a receipts basis, documentary evidence of the expenditure should be supplied (whenever possible).  The College appreciates that it may be difficult to document some overseas travel expenses (for instance when working on projects in rural South Africa): in such circumstances, reasonable claims will ordinarily be made on a per diem basis. Provided these expectations are met, full tax-free reimbursement of expenditure necessarily incurred on the College’s behalf will usually be made.

Expenditure will be reimbursed normally on a receipts basis for locations where there is not an established HMRC per diem for a comparable area or where there are genuinely higher costs than those allowed for in the per diem rates.  Prior authorisation is required before such travel or if getting receipts is likely to be difficult.

Staff are always permitted to use their own resources to stay in hotels or to purchase food and drink beyond College and HMRC limits.

HOSPITALITY EXPENSES

The College generally follows University guidelines for hospitality-related expenses.

Domestic.  Staff are reimbursed for hospitality expenses when such expenses are used to support students (up to certain limits established by the Senior Tutor).  In addition, staff are reimbursed for hospitality-related expenses when engaged explicitly on College business with those who are not College employees.  HMRC regards the refund of hospitality-related expenses for College employees entertaining College employees as a taxable benefit.  Thus staff cannot claim for a working lunch where only College employees are present.  For the purposes of these regulations, tutors/mentors are not considered College employees.  Tips are generally an unavoidable cost of providing hospitality, and tips up to 15% will be reimbursed.

Mentors/Tutors.  Mentors/Tutors may claim reimbursement for expenses related to the support of their tutees up to annual limits set by the Senior Tutor.

College Officers.  College Officers who entertain official guests or business partners on behalf of the College will have entertainment expenses paid (whether these expenses were incurred outside the College or in their private or College-provided residences) may claim for reimbursement of their expenses via actual receipts or via their college credit card.  The University allows a maximum expenditure of £20 per person for lunch and £55 per person for dinner (2010).

Foreign Travel.  When College staff are travelling overseas and are expected to share hospitality, personal hospitality-related expenses extended to individuals are generally included in the subsistence rates unless permission is given ahead of time.  Official hospitality expenses will be reimbursed (say to pay for a meal for a number of people or for a reception put on by the College). When local custom requires an exchange of symbolic gifts or paying for meals for one’s hosts, for example, these may be claimed in the same manner as for domestic hospitality — provided they are reasonable.

Partners/Spouses.  Expenses incurred by partners and spouses of College Officers may be claimed only when partners are ‘required’ to accompany a College Officer in the service of the College.  This should be a rare occurrence.  Thus, if a couple receive an invitation to represent the College at a reception outside of Durham, then the expenses of the couple may be reimbursed.  In the case of partners/spouses accompanying Officers on foreign travel (outside of Europe), a strong case must be made that such expense is of proportionate benefit to the College: in such cases the Principal or the Chair of the Governing Body (or someone explicitly delegated by them) must authorise the travel. Unless the actual services of the spouse can be shown to be required by the College, such reimbursement may not be tax-free (a good test is whether someone else would have had to accompany the College Officer if the spouse were unavailable).

Any questions on this policy should be directed to the Principal or the Bursar.