The ultimate expense policy template

After looking at different policies for inspiration, it is finally time to write your policy. You probably feel overwhelmed, and you are not sure where to start, but don’t worry. 
 

We’ve got the guide and expense policy template you need to get from A to Z and create the perfect policy for your business.  
 

Planning your policy
 

Before you start writing your policy, you’ll need to think about what your business is like. Your expense policy feeds into your company culture and how employees feel about your business.  

If you’re still not sure, check out our article on expense policy examples.  

Does your business value employee freedom, or is it more focused on keeping costs down? If you’re cultivating an atmosphere of freedom and responsibility, then you’ll probably want to create a less specific policy based on guidelines. Alternatively, if you’re aiming to keep expenses to a minimum, then you’ll want to create a detailed expense policy that will close loopholes and reduce spending. 

Once you have a vision of what you want your expense policy to be like, you’ll need to outline the different sections that you’re going to include. 

We’ve written a basic outline below but feel to make it your own. Every company and business expense policy is different, so tailor it accordingly. 
 

Most policies include the following sections: 

• Purpose and scope
• Key principles
• Managing expenses
• Reimbursements
• Travel expenses and mileage
• Accommodation
• Meals and subsistence 
• Official business hospitality 
• Incidental expenses
• Non-reimbursable expenses 

Purpose and scope

The first thing you need to do is briefly define what your expense policy is and what it’s for. You might also want to mention the different employees that the policy covers, for example there might be different rules for managers versus other staff.  

You can start by saying something like: 

This document outlines the correct procedure for purchasing products or services in the pursuit of business activities.

Key principles  
 

Most policies include a section about company values. 
 

Your expense policy reflects your company, so you need to ask yourself, who are you, who do you want to be and what are your values? 

It also affects how employees feel. If your policy is exhaustive and specific, they might wonder if the business trusts them to do the right thing. They might also feel stifled by complex regulations that are too easy to forget.  

On the other hand, if your margins are thin, or you have a complex organisation then stringent rules and regulations might be just what you need. 

Writing a short sentence summarising your values is a good way to start. 

We want to empower you to buy the things you need to do a good job, so we entrust you to spend our money wisely. 

Remember, your values should guide your whole policy. 
 

Managing your expenses 

It makes sense to include a section on how expenses are managed and how the expense procedure works in your business. You can put this section towards the front or the end of the document depending on your preferences.   

If you want, you can call this section “expense procedure” or something to that effect. There are lots of ways to structure this section so it’s a good idea to look at other expense policies for inspiration. In our template we broke our procedure down into several number of short sections. 

Every business has its own expense procedure. The main goal of this section is to describe your procedure as clearly as possible so that your employees know exactly what to do with their expenses.  

Businesses are increasingly moving away from paper and ad hoc accounting procedures, so our template focuses on businesses that use expense management systems. Just use our template for inspiration and adapt it to your business if you still use manual expense reports.  

You can start this section by briefly describing how your business manages expenses. 

Here at [company name], we use accountabl. As an employee, you are provided with an accountabl payment card which is appropriately customised with individual spending rules and limits depending on the position held within the company.
 

Reimbursements 

If your business still relies on manual expense reports, you should include a section on reimbursements. Businesses that use expense management solutions have automated expense reports and can generally skip this section.  

All you have to do is clearly explain how the reimbursement procedure works and what employees need to do to get their money back.  
 

Travel expenses and mileage 

Travel is more relevant to some business and industries than others. If travel and mileage are relevant to you, you’ll need to lay out your guidelines and rules in a dedicated section. 

Before listing the specifics, you should start by briefly outlining your business’ approach to travel expenses. 

We will cover any travel that is done in the pursuit of business outside of your standard travel to and from the office.
 

Don’t forget to mention insurance and other legal requirements! 

You must also ensure that the insurance provider is notified that the vehicle is being used for business purposes and that the vehicle is suitably insured. 

You’ll need to calculate your mileage rates as well. 
 

Accommodation

In this section, you clearly describe your rules on accommodation expenses. 

Ask yourself, when should your employees book hotel rooms? How much are your staff allowed to spend? Does your business have a travel provider? Do you want your workers to book hotels or pay for accommodation in a specific way? 

Meals and subsistence  

Meals and subsistence is another basic section, where you just explain the rules. 

You should ask yourself, when will your business cover your employee’s meals? How much are they allowed to spend? When and where are they allowed to spend it? For example, you might only cover meals and subsistence when they're travelling.  
 

Official business hospitality

Entertaining valuable customers, potential clients and important contacts is important. You should expect to relax the rules when it comes to official business hospitality.  

That said, you’ll probably want to put some constraints in place. For example, you could put spending limits down and factor in the ratio of employees to guests.  

You might also want to create a gift policy too. 

Incidental expenses

Incidental expenses are those little, and often overlooked, extra travel expenses including calls, wi-fi and laundry. Ask yourself, how much should your business cover in a given time period?
 

Non-reimbursable expenses

Lastly, you’ll need to clearly define what your business won’t cover.  For example, most businesses won’t cover costs incurred by friends and family or personal services. 

Download our free expense policy template 

Now that you’ve read through our blog posts on expense policies, it’s time to get writing.   
 

If you missed them, we’ve got a super helpful post on writing an expense policy and a list of inspirational company expense policy examples. 

You can use this article as a guide or download our easy-to-follow template and make it your own. 

Our template is completely free and customisable to help you craft the perfect expense policy for your business in no-time.