A reimbursable expense is a cost you incur on behalf of a customer. Travel expenses and special materials or supplies are examples of common reimbursable expenses. When you bill your client, include these costs on the invoice so that they can reimburse you.
Create a reimbursable expense
- In the left navigation menu, click Accounting > Chart of Accounts, and then select Add a New Account.
- Under Account Type, select Other Income under Income.
- Under Account Name, enter Reimbursed Expense.
- Click Save.
Create your invoice
- In the left navigation menu, click Sales & Payments > Invoices, and select Create an invoice.
- Add the reimbursable expense as a new item, as you would enter any product or service on an invoice.
When you add the reimbursable expense line, click Edit Income Account, and select the Reimbursable Expenses account. You can include the specific details of your reimbursable expense in the product description.
- Add any other products, your customer’s details, and any additional information you need to include.
- Click Save and continue.
- Click Approve draft on the following screen.
- Click Send invoice… to send it to your customer. If you’ve received the expense reimbursement already, under Get paid click Record a payment.
Record the reimbursable expense
- In the left navigation menu, click Accounting > Transactions.
- Click Add Expense.
Enter the information relevant to your transaction, and under Category, select Refund for Income > Reimbursed Expenses.
- Click Save.
To confirm you recorded the expense correctly, in the left navigation menu click Reports > Account Transactions (General Ledger), and under Account select Reimbursed Expense. You should see $0.00 for the reimbursed expense, as the income from the invoice created, and the expense entered on the Transactions page, offset one another.