Out-Of-Pocket Expenses. Definition & How to Declare Them
What Are Out-Of-Pocket Expenses?
The Estonian business system is very flexible and offers many advantages for entrepreneurs. For example, imagine Ana forgetting her business card on her trip to San Francisco and needing to pay a business expense. What can she do?
No problem. Ana can pay that expense with her personal credit card or cash, but ask for an invoice for her company and then tell us that she paid that with her personal money. We will declare that expense as “out-of-pocket expenses,” and Ana can refund that money back into her personal bank account without paying taxes.
Who Can Declare Out-Of-Pocket Expenses?
Any member of the board of an Estonian company can pay expenses with their personal money and then declare them as out-of-pocket expenses. Later, they can refund that money back into their personal accounts.
How to Declare Them?
Log in to Companio and go to your purchase invoices.
If you haven't done so already, upload the purchase invoice.
Then just click the "Out of Pocket" button for that entry in the expense table.
Updated on: 01/12/2022