Single invoice line for re-billed expenses

This limitation is causing me problems too. When I spend a week onsite with a client, I need to invoice as many as a couple dozen receipts (3 meals/day, auto rental, auto fuel, etc.) but their accounting department only needs to see one line item for Meals, one for Auto, etc.

I have tried putting in a lump sum with unit "Expenses", but then the receipts remain "unbilled," and there's no way to change that.

The ideal solution would be able to group expenses by category on the invoice, linking the expenses back to the invoice and marking them as billed.

Kris, what is it about the VAT that is causing a problem; are you not charging VAT on all your re-billed expenses regardless of whether they were VATable expenses in the first place? (all re-billed expenses form part of your service charge so you should be charging VAT on them).

Unless my client wants a breakdown of expenses, I generally add up all of the expenses I want to re-bill (including the original VAT) to get the net cost and group them into a single expenses line on my invoice (with VAT added on top).

Of course, this does mean they won't show as re-billed but I don't really find that an issue.

Of course, I should mention that the above only applies to expenses that you have incurred on your behalf (travel, food etc.), not things that you have paid for on the client's behalf (hosting, domain names etc.) which would usually be disbursements for VAT and treated differently.

Luke/Emily,

Thanks for the replies. Just to clarify, I do charge output VAT on the invoice for both the Time and Expenses elements. I also group the individual expenses (on a spreadsheet with scanned receipts) into a single 'Freeagent Expense'.

Emily, I am not that sure that a breakdown of expenses is required on an invoice by clients. In my experience, the breakdown is provided at 'goods/services' receipt stage i.e. the timesheet. My clients tend to follow a three way match for invoicing (Purchase order, GR and Invoice) with the invoice element being scanned and system matched, so a multitude of invoice lines for expenses causes system mismatches.

However, the main issue I have is with the input VAT element of expenses. Let me illustrate the issue with an example (keeping simple for illustration):

Expense 1 for Hotel with input VAT at 17.5%
Expense 2 for train with input VAT at 0%

If I want to reclaim the Hotel VAT, I would create a separate expense line in Freeagent and apply the correct VAT treatment. Same for the Train part. This approach would result in multiple invoice lines, which is not desired, but at least my company has the benefit of reclaiming the input VAT.

If I group the expenses, I would have to apply the 0% input VAT to the group as HMRC would not look kindly on over-claiming VAT! This would provide me with a single expense line on the invoice, but results in a lost claim for input VAT for my company. There is an associated issue related to grouping as the scanned receipts also have to be grouped and treated a single attachment within the Freeagent expense line.

I appreciate that this is probably not an issue for most, but does seem like a system shortcoming.

Thanks
Kris

Kris, it seems that you can still do what you want, you just may not be able to use the automatic re-bill option.

You definitely need to record them as separate expenses in order to properly account for the input VAT, like you say.

In order to produce a single "expenses" line for your invoice, I would simply calculate the expenses total and create the invoice line manually (with standard VAT as normal).

This does mean the original expenses will not be linked to the invoice as they are when you use the "re-bill" option but I'm not sure if that's actually a problem. Perhaps Emily can confirm, but does this actually do anything other than display the expenses under the invoice as "Expenses re-billed on this invoice"? I'm 90% certain it has no other impact on your books.

Luke,

Thanks for that. I will try the suggested approach. The accounting entries should be fine, but as you mentioned, not sure whether some Freeagent internal process is affected. Will wait for Emily or someone from Freeagent to comment.

Cheers
Kris

My clients are used to separate timesheets and travel expense reports, with one line summaries for each week/trip on the invoices.
So what I was thinking is that since I don't have VAT issues, I'd make one expense entry per expense report (for reimbursable expenses only I mean) and mark it as project reimbursable with a reference to the expense report.

Does that make sense? It'd be nice if the expense report management was more "bundle-able" like timesheets are currently.

Hi Emily,

I should have clarified up front that I'm a US user with no multicurrency issues - at this point anyway :)

What you're saying makes sense if I'm understanding correctly. Let me recap:

Since I have separate itemized travel expense reports (airfare, hotel, rental, gas, meals, etc) with photo receipts, in FreeAgent I could use one bundled expense entry for these reports (and attach the entire pdf report) but for any other types of rebillables such as equipment, postage, etc and non-reimbursed expenses I'd continue to use one entry per expense/receipt.

Do you have any suggestions on which category would be appropriate?

Thanks for the help, I really appreciate it!

Side note: The reason this is an issue for me is most of my corporate clients have their own spreadsheet type expense report format for travel expenses with their own codes, subtle category differences, etc and they tend to go through completely separate approval workflow than the invoices.

Great, thanks for the help!