Process and pay expense claims
A quick overview for using Xero's expense claims is shown below - refer to our Expense Claim help for full details and screen instructions.
Expense claims should be used where personal funds have been used to pay for something for the business. Expense claims can be submitted by employees in your organisation or by business owners. The way the claim is reimbursed may be different depending on who submitted it, and this is covered below.
- Enter your receipts.
Enter each receipt individually into the current expense claim (displayed by default) using the Add Receipt button on the main Expense Claims screen. These will total up automatically so you can see how much your claim will be for. Attach an electronic copy of the actual receipt using the Attach a file link. If you're adding a lot of receipts at one time, we recommend you Save regularly - after you've entered about 30 receipts.
- Submit your claim.
When you have entered all the receipts you want to claim and it's time to hand your expense claim in, submit it for approval using the Submit for Approval button on the main Expense Claims screen.
- If you want to keep a record of the expense claim, use the Expense Claim Summary Report that you can get to from the confirmation bar that displays as soon as you have submitted your claim or from the Previous Claims tab for each claim. The Pending Claims tab will also show you the status of the claim as you wait for it to be paid.
(Only users with a user role that allows them to approve claims beyond this point.)
- Approve the claim.
Open each claim on the Awaiting Authorisation tab and approve or decline the receipts on the claim. Authorise the claim for payment by entering the payment and reporting date.
- Pay the claim.
Make the payment from your bank account to the person who submitted the claim.
- Reconcile the claim.
Once the payment has gone out of your online bank account and has been imported into Xero you can reconcile it to the claim during the bank reconciliation process - this will mark the claim as paid. Alternatively, you can go to the claim on the Awaiting Payment tab and enter the amount you've paid onto the claim and then reconcile this payment to the payment that's downloaded from your online bank account.
- If the claim is to be paid back to your employee or yourself, enter the amount of the payment onto the claim (this can even be a part payment) and make the payment to that person. Choose that the claim be paid from the same bank account in Xero as the payment will go out of.
- If the claim is to be paid back into the business, do the same thing by entering the amount of the payment onto the claim but this time, choose the owner's equity account that you have set up in Xero. By default this is 'Owner Funds Introduced'. If you don't have Xero set up to enable payments to this account (or whichever account you want to use for this) you need to go to your chart of accounts and enable payments to the account.