Employee Reimbursement Policy - Template, Sample Form Pro · IN-law

EMPLOYEE REIMBURSEMENT POLICY

This Employee Reimbursement Policy ("Policy") is effective from ________ ("Effective Date") and is issued by ________, a company incorporated under the Companies Act, 2013, having its registered office at ________ and bearing Corporate Identity Number (CIN) ________ (hereinafter referred to as "We", "Us", "Our", or the "Company"). This Policy applies to the Company, its subsidiaries and joint ventures over which the Company exercises management control.

All employees and other stakeholders of the Company are expected to read, understand and comply with the procedures set out under this Policy. This Policy forms part of the terms and conditions of employment and shall be read in conjunction with the applicable provisions of the Income-tax Act, 1961, the Code on Wages, 2019, and other applicable laws.

§ 1. SCOPE

(a). This Policy applies to all employees of the Company, including trainees, apprentices, interns, part-time and full-time employees, and to such other stakeholders as may seek reimbursement of expenditure incurred on behalf of the Company.

(b). This Policy does not form a contract of guaranteed entitlement to any specific amount and reimbursement remains subject to the terms, limits and approvals set out herein.

§ 2. GENERAL GUIDELINES

(a). This Policy outlines the reimbursement framework of the Company concerning the reimbursement of specific and reasonable expenditure incurred by the employees exclusively for the purpose of the Company's business. The expenditure shall be necessary for the business transactions of the Company and shall be in relation to the individual's regular responsibilities or special assignments.

(b). The Policy facilitates timely processing of payment and proper documentation of authorised expenditure.

(c). The employees shall read and understand this Policy before incurring any expenditure on behalf of the Company.

(d). All employees or other persons intending to obtain reimbursement from the Company shall adhere to this Policy. Failure to adhere to this Policy may result in non-reimbursement of the expenditure incurred or other disciplinary action against the employee.

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(f). The employees are required to use the most economical and cost-effective method when incurring business expenses. If any expenditure is found to be unnecessary or extravagant, such expenditure will not be reimbursed by the Company and the employee shall be solely responsible for the same.

(g). The approved business-related expenditure may be paid by the Company in advance or reimbursed upon submission of valid documents in accordance with this Policy.

(h). Reimbursement of actual business expenditure supported by valid documents and incurred wholly, necessarily and exclusively for the performance of official duties shall be treated in accordance with the Income-tax Act, 1961 and the rules made thereunder. The tax treatment of any payment under this Policy shall be governed by applicable law, and the Company reserves the right to deduct tax at source where required.

(i). The business expenditure will be approved by the ________ ("Approver") unless otherwise mentioned under this Policy.

§ 3. REIMBURSABLE EXPENDITURES

The following expenditure is generally reimbursable by the Company after scrutiny and approval by the Approver:

(a). Travel Expenditure

(I). All pre-approved and justified travel expenditure will be reimbursed to the employee.

(II). The employee shall endeavour to book tickets in advance and shall choose the best and lowest-cost option.

(III). Travel shall only be undertaken where alternative options are not feasible.

(IV). Before undertaking any business trip, the concerned employee shall submit a request to the ________, and such request form shall include all necessary information including the purpose, location, duration, method of travel, estimated budget, etc.

(V). The employees may utilise personal vehicles for business travel when other transportation is unavailable or uneconomical.

(VI). Mileage will be reimbursed at the rate of Rs ________ per kilometre as fixed by the Company, inclusive of all automobile costs including fuel, repairs/maintenance, insurance, etc.

(VII). The reimbursement claim for a personal automobile shall include the date, time, business purpose, origin and destination locations, kilometres travelled, and the name of the approving authority.

(VIII). Everyday commuting to/from the regular work location is not covered under this reimbursement.

(IX). Any accident or other damage to the vehicle is not covered under this Policy and the employees are advised to maintain full coverage insurance for their vehicles.

(X). Necessary taxis or other ground transportation will be reimbursed. The employees are required to check economic and convenient options before considering any general taxi services which may be more expensive.

(XI). Travel expenses of companions will not be reimbursed by the Company unless otherwise approved in writing, and shall be the sole responsibility of the employee.

(b). Food Expenditure

(I). Reasonable food expenditure will be reimbursed to the employees upon submission of the detailed purpose and an itemised list of receipts.

(II). Individual daily meal expense is limited to Rs ________ (________), unless special approval is received from the Approver.

(III). Room service or expenditure on alcohol is not covered under this Policy.

(c). Accommodation

(I). All accommodation shall be pre-approved in writing by the Company unless the employee was unable to obtain prior permission due to reasons beyond his/her control. Such special circumstances shall be scrutinised by the Approver and the decision of the Approver shall be final.

(II). Employees shall always use moderately priced accommodation whenever possible.

(III). The maximum amount reimbursable for accommodation per day is Rs ________ (________), unless special approval is received from the Approver.

(IV). Room upgrades are permitted only if there is no additional cost to the Company.

(d). Other Expenditure

(I). Eligible employees may claim mobile phone bill reimbursement, subject to a cap of Rs ________ (________) per month.

(II). Pre-approved expenditure on training and education of employees.

(III). Pre-approved cost of tools and equipment used exclusively for business purposes.

(IV). Pre-approved cost of licences or professional fees incurred directly in relation to the Company.

(V). Medical reimbursement, subject to a maximum of Rs ________ (________) per annum. Only the medical expenditure of the employees is covered.

§ 4. NON-REIMBURSABLE EXPENSES

The Company generally reimburses only expenses incurred directly in connection with its business. The following are some of the expenses which are non-reimbursable, and the list is not exhaustive:

(a). Personal expenses of any kind.

(b). Fines or penalties imposed by any law enforcement or statutory authority in connection with the act of the employee.

(c). Travel insurance. Employees are advised to opt for personal travel insurance whenever possible.

(d). Personal entertainment.

(e). Unauthorised expenditure on meals, entertainment, etc.

(f). Unauthorised upgrades in transportation or accommodation.

(g). Expenditure on companions unless necessary and approved by the Company.

(h). Loss or theft of personal belongings of the employee.

(i). Expenditure for personal gain.

(j). Personal purchases.

§ 5. EMPLOYEE RESPONSIBILITIES

(a). Document all expenditure which the Company has not directly arranged for the employee.

(b). The list provided under this Policy is by no means exhaustive. Employees should always obtain approval from the ________ or higher authority before incurring any expenditure on behalf of the Company.

(c). Always apply due diligence and take expenditure decisions which are most favourable to the Company.

(d). Whenever possible, avoid mixing personal and business expenditure. If unavoidable, the employee shall submit a detailed break-up of expenditure.

(e). In case of any doubt in relation to business expenditure, always consult the ________ before incurring such expenditure.

(f). If any employee incurs unapproved business expenditure, the Company shall have the full right to reject such reimbursement request, and in such case the employee shall keep the Company indemnified against any liability arising therefrom.

§ 6. ADVANCE PAYMENTS

(a). In certain cases, the Company may provide advance payment to the employee for anticipated business expenditure, subject to the prior approval of the concerned Approver.

(b). The employee shall submit a request for advance payment along with the estimated budget and the purpose of such expenditure to the concerned authority before the date of travel or expenditure.

(c). The advance payment shall be used exclusively for the purpose for which it was sanctioned, and the employee shall submit a detailed account of such expenditure along with the supporting documents within the prescribed time.

(d). Any unutilised amount out of the advance payment shall be returned by the employee to the Company within ________ days from the completion of the business activity or trip.

(e). If the actual expenditure exceeds the advance payment, the balance amount shall be reimbursed to the employee upon submission and approval of valid supporting documents in accordance with this Policy.

§ 7. PROCEDURE FOR REIMBURSEMENT

(a). The employee shall submit the expenditure reimbursement form within ________ days from the date of expenditure.

(b). The reimbursement request form shall be approved by the ________ before submission to ________.

(c). The request form shall be submitted to the ________. The ________ shall scrutinise the request form along with the documents attached and shall ensure that such application is in compliance with this Policy and the other applicable rules and regulations of the Company.

(d). The request form shall contain all required information including the date of expenditure, place, descriptions, details of products/services, business purpose, and details of the person/department who approved such expenditure.

(e). Always submit approval emails or documents along with the claim request.

(f). Submit the original copy of the receipts and invoices. The employee may be asked to submit bank statements to substantiate or cross-verify the expenditure.

(g). The reimbursement shall be paid to the concerned employee within ________ days from the date of submission of the request form; or, if such request is rejected by the concerned authorities, the same shall be communicated to the concerned employee within ________ days from the date of submission.

(h). The employees are required to return any reimbursement or allowance that exceeds the substantiated expense within ________ days from the date of communication from the concerned department.

(i). If the employee fails to refund the excess amount paid on account of reimbursement within ________ days, such excess amount may, subject to the provisions of the Code on Wages, 2019, be adjusted against the salary or other payments due to the employee.

(j). Any dispute in relation to the reimbursement amount or rejection of reimbursement shall be escalated to the ________ or higher authority within a period of ________ days from the date of communication or payment of the disputed reimbursement amount.

§ 8. DOCUMENTATION AND DATA PROTECTION

(a). The files and records in connection with reimbursement claims and any related disciplinary action shall be preserved for a period of ________ from the last date of employment, or for such longer period as may be required under the Income-tax Act, 1961 or other applicable law.

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§ 9. CHANGES TO THIS POLICY

(a). We reserve the right to revise and amend this Policy from time to time to adapt to changing circumstances and laws. The employees and other stakeholders are required to refer to the updated version from time to time on the website or other records of the Company.

§ 10. GOVERNING LAW AND JURISDICTION

(a). This Policy shall be governed by and construed in accordance with the laws of India.

(b). Subject to the internal escalation mechanism set out in § 7(j), the courts at ________ shall have exclusive jurisdiction in respect of any dispute arising out of or in connection with this Policy.

§ 11. FURTHER INFORMATION

(a). For any queries or further information about this Policy, the employee or other concerned person may contact the following department/person: ________ (________).

§ 12. ACKNOWLEDGEMENT

(a). By signing this Policy:

(b). I acknowledge that I have reviewed the above-listed policies and guidelines of the Company and understand my responsibilities.

(c). I agree to report any actual or potential situation or incident that may be contrary to the above policies as soon as I become aware of it.

(d). I agree to abide by the aforementioned policies and I understand that my failure to follow the policies may result in disciplinary action, up to and including dismissal.

Employee Name: ________

Designation: ________

Date: ________

_________________________

Signature

REIMBURSEMENT REQUEST FORM

________

Name of the employee: ________

Designation: ________

Department: ________

Branch: ________

Employee/Payroll ID: ________

Date/period of expenditure: ________

Category of expenditure: ________

Description of expenditure: ________

Total amount: ________

Approved by: ________

Claimed by: ________

Dated: ________

Signature:

Checked by: ________

Signature: