What is the difference between Re-imbursable and Claimable expenses?
The difference between a Claimable Expense and a Reimbursable Expense is as follows: Claimable Expenses are expenses that are incurred by the contractor and they must be wholly and exclusively business related. The agency/client do not pay these on behalf of the contractor, they are expenses that are claimed through the Umbrella Company. By submitting an expense the contractor is effectively reducing their taxable earnings and thus reducing the amount of PAYE and NI paid. Reimbursable Expenses are expenses the contractor has incurred and that the agency agrees to refund back to the contractor. The agency should pay VAT on these reimbursable expenses as they do on the rest of the invoice.
