Urssaf and expense claims: how to avoid being reassessed?
Urssaf and expense claims... it's a question that worries companies. And with good reason: a tax reassessment can happen very quickly, often because of a simple error rather than a genuine desire to cheat.
As a public body responsible for ensuring compliance with regulations, one of Urssaf's missions is to combat fraud and concealed benefits in kind... and this involves checking expense claims.
Whether you're a company, a self-employed worker or an association, you need to be as rigorous as possible.
What are the best practices to follow to avoid the pitfalls of an audit? We tell you all about it in this article co-written with Charlène Serayet, manager of Dasmind, a company specialized in administrative management for businesses.
What are business expenses?
There are many different types of business expenses. Let's take a look at the ones most commonly associated with expense reports:
Travel expenses
These are not expenses relating to the daily commute to work, but business travel (customer meetings, attendance at conferences or seminars, supplier visits, etc.).
In this context, the employee incurs a certain number of expenses, notably for accommodation and transport. However, business travel expenses are only justified if the distance between home and the place of work :
- is equal to or greater than 50 km,
- requires more than 1 h 30 by public transport (one way).
In addition, if the employee uses his or her personal vehicle, allowances are applied according to a mileage scale defined by Urssaf.
Last but not least, the cost of car rental by the employee, as well as petrol and toll charges, must also be covered by the company.
How to deal with these expenses? See this article dedicated to the reimbursement of travel expenses.
Meal expenses
Still in the context of business travel, employees' personal meals may be reimbursed under certain conditions.
But meal expenses can also be incurred for business lunches, with a customer or prospect for example.
Other business expenses
Finally, there are other professional expenses, such as those related to telecommuting or the purchase of equipment needed to carry out the assignment.
How are business expenses reimbursed?
There are several ways of reimbursing business expenses:
Reimbursement of actual expenses
This is based on receipts and reimburses the exact amount spent by the employee. The only constraint is that the employee advances the money before being reimbursed by the company.
Flat-rate reimbursement
means that the employee is always reimbursed the same amount, according to scales established and updated by the Urssaf. This type of reimbursement covers :
- accommodation,
- meals,
- the use of a personal vehicle for business purposes,
- professional mobility within France.
In this case, the employee is not required to provide receipts, but must specify the reasons for the expenses incurred.
Urssaf inspections and expense claims: 6 best practices to observe in 2024
⚠️ The Urssaf remains particularly vigilant on the issue of business expenses, as some companies do not play the game. There are several reasons for this:
- business expenses are exempt from social security contributions;
- VAT is deductible on certain expenses, for example :
- tolls,
- diesel fuel (but not petrol),
- meal expenses,
- breakfasts or drinks for hotel accommodation, etc. ;
- reimbursement of business expenses is not taken into account when calculating income tax.
Some organizations are therefore tempted to commit fraud in order to increase their profits, or to offer benefits to their employees.
Tip: be particularly rigorous when managing your expense accounts!
Tip no. 1: keep receipts
The absence of supporting documents for actual expense claims is the primary reason for a tax reassessment by Urssaf, which considers the expenses concerned to be benefits in kind.
That's why you must always have valid supporting documents in your possession.
Invoices, notes... make sure these documents include all the required information:
- the name of the establishment concerned (hotel, restaurant, etc.),
- address,
- date of transaction,
- the amount.
Finally, since it is possible in some cases to benefit from a VAT deduction, make sure that all receipts are drawn up in the name of your company.
☝️ In the case of a business lunch, the document must also specify :
- the reason for the meal,
- as well as the names, positions and contacts of guests.
A word from the expert
Expense statements are used in almost all companies, to reimburse expenses incurred by employees on behalf of the company. However, even if this system is very practical, it is nonetheless regulated.
An expense claim must include the mandatory elements listed above.
If the expense claims do not comply, or are missing, the company runs the risk of having the expenses requalified, which could lead to additional social security contributions.
To avoid this, you need to be vigilant about compliance and the presence of expense receipts. You can use a software program or simply create a filing form with the mandatory fields (less costly for small teams).
Tip 2: Respect the tax exemption threshold
Are you opting for flat-rate reimbursement? Then don't exceed the ceilings predefined by Urssaf. Otherwise, the company must subject the additional amounts to social security contributions.
💡 To avoid any inconvenience, we recommend that you define a spending policy to clearly communicate to employees what limits must not be crossed.
Tip 3: Choose the right reimbursement method
Always choose the right reimbursement method.
For example, if you don't have a receipt, opt for a flat-rate reimbursement.
Also, be aware that you can't change your mileage reimbursement to actual mileage.
Finally, please note that flat-rate reimbursement does not apply to company directors. They must opt for reimbursement of actual expenses (excluding mileage allowances), with supporting receipts.
Tip 4: Stay alert to expense fraud
Without being in bad faith, a company can be inattentive to employee expense claims, and expose itself to risk. So stay vigilant and check your employees' receipts... before Urssaf does it for you!
Voluntary expense fraud also exists. Getting invited to a restaurant but having to collect the bill in order to be reimbursed, asking the cab driver to inflate the bill... these are all cheating practices practised by some employees. The solution? Apply a genuine expense management and control policy.
Tip no. 5: avoid excessive or inconsistent expenditure
Urssaf is perfectly capable of judging whether expenses are too high or inconsistent with the reasons given. In such cases, the organization considers them to be benefits in kind (concealed), and therefore subject to social security contributions.
For example, lunch in a restaurant with a client is acceptable. But if your family joins in the meal, it will look dubious.
Therefore, make sure that expense claims are for useful and reasonable expenditure, in the interests of the company and its activities.
☝️ Be aware that if a single employee eats more than 5 business meals a month, Urssaf may also deduct this as a benefit in kind. This is why you need to be able to justify the necessity of all these lunches for the smooth running of the company.
Tip no. 6: Prevent mistakes by enlisting the help of others
Avoiding mistakes... this advice may seem obvious, but many companies have been subject to tax reassessments as a result of flaws that were not the result of dishonest behavior, but just simple clumsiness. For example, the manual management of a large number of expense claims sometimes leads to an expense being claimed twice, a practice considered fraudulent!
That's why it's important to pay close attention to these operations, and if necessary, to get help from :
- with software. Software is available to help you manage your expense reports. Eurécia Notes de frais, a module of the Eurécia HR software, enables employees on the move to record their business expenses and transfer receipts from their cell phone. All information is automatically forwarded to the employee's line manager for validation and processing. Reimbursement terms and validation rules are defined in advance. This avoids the risk of errors and, above all, lost documents.
- by a professional. By way of illustration, Urssaf has advisors on hand to help you through the process. You can even voluntarily request an audit, to ensure that your expense claims are properly processed.
Article translated from French