Best Practices to Manage and Control Business Travel Expenses

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With the constant increase in business travel around the world controlling travel expenses across the company has become a major concern for many. Travel and entertainment expenses are the second most controllable cost that companies face. The process of streamlining travel expenses for business as well as reimbursement guidelines can assist businesses in reducing their total expenditure, thereby improving their bottom lines.

Before we dive into the details of what the costs for business travel are, let’s define the context of “business travel” more clearly. When employees leave their workplace for work-related reasons and activities, they are considered to be business travelers. It could be a trip to a trade show or a business event or a conference, or a trip for a week to a different office or to meet with a customer or a vendor, among other items. In short, any non-office travel for business reasons is referred to as business travel.

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What is a typical business travel expense?

If employees in your business engage in any travel-related activity that is connected to business, it could be classified as a business travel expense. This can include any money spent on food, travel (including trains, airfares or taxis, car rentals, as well as self-driven automobiles), and lodging (in hotels or studio apartments, or Airbnb) in accordance with the rules of your company.

In addition, other non-essential or miscellaneous expenses connected to business travel could be classified as business travel expenses and be reimbursed in accordance with this. Knowing what counts as business travel expenses and travel expenses can help develop a travel budget to adhere to and cut down your expenses.

What is a legitimate business expense?

Any legitimate expense to travel for purpose of business, as defined in your company’s corporate travel policy is able to be considered an expense to travel. The most important thing worth keeping in memory is that this cost must be related to business. It should help the company in terms of revenue, customers, and quality of production or add to the efficiency of the business in the way that it can.


Employees should be able to make claims for expenses related to travel. This would include travel trains and bus tickets, the cost of fuel for personal transportation employed for business use, and travel expenses on the ground for business trips. However, even among these costs, it is advisable to specify what kind of transportation is acceptable. As an example, it is possible that you should not permit employees who are below the specified classification to fly first-class or business-class train tickets. Taxis and cabs can only be permitted under certain conditions. The fuel cost may be limited per kilometer or per day.


On business trips, meals should be considered to be a reimbursement expense. Setting up a budget per day for each meal for each person could be a good way to account for these costs. It is also possible to provide meals to clients and vendors as well as colleagues in the event that employees are on a business trip.


If an employee must spend the night in a particular location to conduct business, the accommodation cost for a hotel or Airbnb could be considered to be an expense for business travel. Based on the location and duration of stay, you could offer a per-night accommodation allowance. It is also possible to specify the type of hotel you prefer or the kind of room that employees have to stay in.

Incidental expenses

Certain expenses that are incidental to the trip can arise during the road for business. These include parking charges, WiFi charges, phone expenses, laundry costs as well as dry-cleaning services for long stays, as well as other costs. So long as they’re part of a business trip and justified and justified, they are able to be classified as expenses for travel.

Health insurance and insurance

Travel insurance and health insurance to cover business travel are also legal business expenses for travel. It is the obligation of companies to take care of their employees. To ensure the security of your employees, it is important to permit them to claim medical expenses or insurance costs that occur during business trips.

What isn’t considered to be an expense for business travel?

Unrelated expenses or even the business side shouldn’t be considered as a business travel expense, and should not be qualified for reimbursement of travel expenses. A few examples are:

Entertainment for the personal

The cost of private entertainment of employees is not eligible for travel reimbursement. For instance, film rentals in hotel rooms, bar costs cigarettes spa or swimming pool fees, tickets to performances or sporting events such as sports events, etc. These expenses are not in the category of travel costs for businesses.

Non-business meeting

If an employee is attending a private meeting that isn’t related to work, the business should not be responsible for the cost. This applies to meals, transportation or entertainment, or any other expenses that do not improve the well-being of the company.

Additional expenses

Other miscellaneous costs like gratuities to hotel staff, extra baggage and concierge services, parking charges at airports, etc. They should also not be classified as business expenses. These should be outlined in your travel policy for business to avoid confusion over what qualifies as an expense for business travel and what is not.

The leisure aspect of leisure trips

When an employee has to mix work and leisure time, which is commonly called a leisure journey. If that is the case, costs related to personal travel are not allowed to be considered business travel expenses. This is the same case when an employee chooses to stay longer in an area they’re going to for business.

Why is it important to track your travel expenses?

To have a clearer view of the finances

By keeping track and an account of your business travel expenses and having a policy on reimbursement for travel to stay in control of your expenses. Since it is the second most cost that a business can control it is possible to identify the areas that you spend too much on, manage these expenses accordingly and ensure the financial health of your company is in top shape.

For tax-related reasons

One of the main reasons to keep track of the business expenses of travelers is to be able to use them for tax purposes. In Singapore, the Inland Revenue Authority of Singapore permits businesses to claim travel expenses as deductions when filing tax returns. In keeping track of the money paid for travel and travel expenses of the company will help lower your tax burden. Additionally, you should keep track of these expenses in order to demonstrate to the authorities that you did not improperly handle funds in case of an audit or inquiry.

To verify the conformity of the travel policies

The tracking of your business travel costs will allow you to determine whether your employees are adhering to the company’s travel policy guidelines. It can help managers and executives to accept or deny requests for travel and control reimbursements for travel. It also helps to stop possible fraud in the bud.

Clarify what employees are allowed to spend their money on

If you monitor the expenses of business travel and expenses, you will have more insight into where employees are spending money when they go on an official trip. This can assist you in modifying your policies and presenting even more complete and effective business guidelines for your employees. The result will be more satisfied and happy employees.

How do you manage the travel expenses associated with your business?

Create a clear business travel policy

The best way to manage the cost of business travel is to establish the right corporate travel policies. Your travel policy should be as precise as you can with specifics regarding how much employees are allowed to pay for meals, transport accommodations, meals, incidental expenses as well as other expenses. A clear policy will help remove any confusion about business travel costs and help to prevent the amount of money that is spent. Here’s the Corporate Travel Policy for Expenses Policy template that is available to download and start your journey towards developing a solid business travel policy!

Make sure you communicate your policies and urge their adoption

It’s not enough just to have a great travel policy. Employees should be aware of the policy. Make it available to every employee regardless of whether or not they are expected to go on a trip or not. Facilitate access to it through an employee’s portal. It is a good idea to send a reminder to employees who are planning an appointment to help them refresh their memories. Make sure to keep the policy easy to comprehend and emphasize the key points.

Automate the process of approval

What if you configure expenses management software to email both the employee and their supervisor in the event of out-of-policy travel? A travel management tool could aid in this. It is possible to do the same for bookings that are made too close to the date of travel. Making sure that these outliers need approval from the management team will help encourage employees to follow the policy and make prior reservations. You can utilize Aspire’s approval processes to establish approval procedures to notify managers about the bookings and monitor out-of-policy expenditures.

Incentivize employees to adhere in line with the policy

Incentivizing employees or offering an incentive for adhering in line with your travel policies could help them reduce their expenditures. If an employee has a good return on their investment or low-budget travel arrangements, consider giving them a portion of their savings or giving them a voucher. This can boost the morale of employees and encourage them to adhere to the budget. It is also possible to have severe sanctions for those who do not follow the guidelines of the policy.

Have tie-ups

An effective way to cut down on costs for business trips is to join forces with transportation companies, hotels, and insurance brokers. Then, you can avail of discount rates for corporate clients who make frequent bookings. Encourage staff members to book through your partners not only to guarantee higher rates but also to help your employees by offering discounts and discounts.

Look for bundles of services

As much as you can it is possible to bundle your services. For example, if you prefer to stay in a place with food included and meals, you will be able to save on food costs. A travel agent who can arrange the flight’s hotel rooms and meals may be efficient.

Create a timeline for booking

Traveling too close to your business trip could increase costs. Instruct your employees to prepare their travel plans in advance and make reservations in order to make the most efficient reservations. For instance, you can set up a schedule for bookings that specify that domestic travel is required for booking fifteen days in advance, and international travel is 30 days in advance. In this way, you’ll be able to benefit from lower prices.

How do you manage and track your business travel expenses effectively?

Create an account

The best way to keep an eye on company travel expenses is to establish a budget. Start by creating a corporate budget for the year. Based on the teams and employees who will need to travel, assign an annual budget to cover business trips. Utilizing a budgeting tool will help you streamline the process and make it easier to estimate expenses more precisely. Aspire’s budget tool allows you to manage the expenses of your company’s travel and monitor the amount you spend.

Sort your expenses into categories

Making distinct categories for your expenses will aid in tracking and reducing expenses. Classify your business travel expenses in terms of meals, accommodation, transportation, and on-ground transportation, for example. Create a miscellaneous category for the other smaller expenses. Instruct your employees to adhere to these categories when they file to claim reimbursements for travel expenses.

Set the payment mode payment

Make clear how you would like employees to cover their company travel costs. The issue of a corporate credit card to employees will help to keep track of costs and better manage them. It also helps reduce the risk of fraud. For example, you could request employees to provide their credit card statements in addition to providing vouchers and receipts. If they only have receipts for cash purchases They could be forgeries. Aspire’s unlimited corporate cards allow secure and safe spending. Insofar as possible avoid spending on personal credit cards as well as in cash.

Beware of certain traps

Do not offer shared accommodations to employees in order to cut expenses. This can result in uncomfortable and unpleasant experiences. Do not skimp on insurance. It could increase your costs in the event in the event of an unexpected emergency. It is also easy to get caught up by corporate deals due to cost savings. But, ensure that it’s also convenient for your workers.


Business travel is essential for any business looking to expand its operations. Calculating and tracking the expenses of business travel does not need to be a difficult task. Planning the business expenses in advance can provide you with an accurate estimate of the total your business travel expenses will be able to incur in the course of a year. It can also help make the process of expense reimbursement a lot easier. Furthermore, be careful with your travel plans by giving employees the exact amount of spending they are allowed to do, bundling their services or looking for tie-ups, and having a travel consultant handle business travel will aid in keeping these costs in check.

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