TABLE OF CONTENTS
Business expense reimbursements in India are managed through the Remote People platform, allowing both employees and employers to upload claims. This ensures a streamlined and compliant process for reimbursing work-related costs.
Submission Timelines
On-Time Submission: Expenses uploaded and approved by the line manager before the 15th of the month will be reimbursed with the same month's salary.
Late Submission: Expenses uploaded or approved after the 15th will be reimbursed with the next month's salary, paid on the last day of the following month.
Eligible Expense Categories
Reimbursable expenses for business operations include:
Travel expenses (including mileage, tolls, parking)
Communication expenses (mobile, internet)
Entertainment expenses (client meals, events)
Training expenses (seminars, courses, memberships)
Documentation Requirements
To ensure tax-free reimbursement, all expense claims must be supported by valid documentation:
Invoices or bills must clearly show:
The nature of the expense
The payer's name (must match the employee's name)
Invoices are generally required.
Parking tickets and tolls must be submitted separately from mileage logs and include receipts.
Tax-Free Reimbursement Examples
With proper documentation, the following expenses can be reimbursed tax-free:
Vehicle expenses: Fuel receipts, car maintenance invoices
Telephone expenses: Internet bills, mobile recharge bills
Food coupons: No bills required for exemption
Per Diems and Taxability
Per diems may be taxable depending on the client's policy.
Food coupons are exempt from tax and do not require receipts.
National and international per diem rates for 2025 are subject to client-specific guidelines.
Entertainment and Gift Expenses
Client entertainment, team gatherings, and gifts must comply with the client's tax policies and internal compliance guidelines. These rules vary and must be aligned with the company's approach to taxable benefits.
Health & Wellness Reimbursements
Only medical bills are eligible under Section 80D (Health Checkup).
The maximum exemption limit is Rs. 5,000.
Other wellness-related expenses (e.g., gym, therapy, yoga) are not reimbursable under current tax guidelines.
VAT on Reimbursable Expenses
VAT may apply to reimbursable expenses depending on the nature of the expense and the vendor. This is subject to local tax laws and client-specific accounting practices.