If a costing module has been configured, this tab can be used to view projects or project headers the user has been given access to, or to set that the user is to have access to all projects or project headers. These projects and project headers will then be visible to the user when entering a new expense. All expenses incurred by a business during a particular accounting period are treated as a cost and recorded in an income statement. An income statement is often known as the Profit & Loss, or (P&L) Statement. It’s important to have a basic understanding of the three main financial statements to help you evaluate your company’s fiscal performance. Including phone and internet service, communication utilities are deductible as business expenses.

Others will be day-to-day purchases – costs your business incurs regularly to bring your product or service to market. When you run a business you’ll have to pay for certain things to provide your goods or services. Pleo’s spending solution makes keeping track of expenses a breeze, not to mention its seamless integration with your favourite accounting software. With cash accounting, the expense is only recorded once the actual cash has been paid out. Direct expenses (as the word implies) are the expenses that are directly related to the core operations of your company.

Making Tax Digital

If enabled in System Settings, the Audit History tab will be visible and will show information on line entry, amendments and any deleted items. Once the expense has been submitted and is progressing through the approval route, this tab will become populated. If the expense has been marked as Urgent, the reason given will show here. WAP Projects is a simple costing module which sits within WAP and does not post to Sage – it can only be used if no other costing module is in use.

• For example, if you start with a 12 month contract and you secure another 12 month contract with that client, you must stop claiming expenses at 12 months.
• In cash accounting, the transaction is recorded only when payment is actually made; for example, when the money leaves your account, rather than when the liability occurs.
• As capital expenses tend to be higher in value, these are likely to be taxed more heavily than other expenses.
• The app does not track the exact route a user has driven and will therefore not use additional data in this feature.
• The Expenses Module has many features and not all will be used, so further user-specific set-up can be found within the functionality sections.

Any capital expenditure is recorded as an asset in your company’s balance sheet rather than on the income statement. Expenses you can claim (aka allowable expenses), are the essential costs that keep your business ticking over each month. So, you have all these different types of expenses that make running your business possible. Although the two terms are sometimes used interchangeably, capital expenditures are not accounted for in the same way.

How do I record my business expenses in inniAccounts?

Enter a name for the rate, select a vehicle type, fuel type and country (if applicable). If editing an existing fuel rate, click to drop down on the Allocated Vehicles to view any vehicles that have been linked with the fuel rate. If vehicles have been linked and claims submitted, limited fields will be able to be edited. The bank fees that are charged to your business accounts, including credit card and loan interest, can be claimed as business expenses.

For example, advertising activity that costs £1m clearly uses up a value of £1m. This may or may not be a wise decision, but if it results in sales activity that generates profits of more than £1m, the expense is the primary cause of an overall increase in value. Adding them to a subsistence category all of their own allows you to look at them separately and make an individual assessment rather than hunting through every expense claim for issues. If you are working in a company that has a convoluted nominal ledger with codes all over the place you may well find it difficult to pick out all the codes that relate to a particular type of expense. Directors often have credit cards and some tend to use these as an extension of their own personal card. Having a category to group costs into, regardless of the nominal code means that you can easily identify things that need to be added into your reports manually.

An introduction to business expenses

And finally, your revenue minus all expenses is the total net profit of your company. In this blog post, we’ll cover accounting expenses 101, plus tips for keeping track of it all. When you think of accounting, you probably think of complex spreadsheets and digging around for crumpled receipts, but every business depends on good expense management. Taking care of your business accounting expenses can be pretty intimidating (unless you’re an accounting firm, of course).

Once the expense has been submitted and approved, it will post through to Sage as an invoice. Create a new vehicle and link it to the Fuel Card fuel rate; this is done through System Setup – Vehicles. A new fuel rate will need to be created with a zero-value rate; this is done through System Setup – Fuel Rates. Or alternatively, tap on the expense itself to view in more detail; click on the Lines tab to view the individual lines. Once within the approve expense page, the approver will see the expense ID, Sage Company, Employee name, Net and Gross values and Expense Date.

7. Subsistence Rates

Subsistence Rates are based on time spent away from the workplace and are setup within System Setup – Subsistence Rates. Once configured, these will then be available to all users when entering a subsistence claim, depending on their Grade. Once the credit cards have been set up and allocated to users, bookkeeping for startups the following setup is required. With this configuration users will manually enter any spends they have made with their company credit card. This allows for users to enter claims as they happen but does potentially increase the risk of the user forgetting a transaction or entering the details wrong.