Expense claims through payroll

An expense claim with Reimbursement Mode Payroll is paid with the employee's salary. When the payroll run is calculated, xMatix pulls the employee's posted, unpaid Payroll-mode claims into the run, lists each one on the payslip, and the run's salary payment batch pays it together with the net salary. Settle via Payroll on the claim does the same hand-over early. Payroll is one of the ways to clear a posted claim. The others are Reimburse (pay from the bank), a reimbursement batch and an advance settlement. The claim must already be entered, approved and posted.

Overview

The claim's expense was booked when the claim posted, so payroll never accrues the reimbursement a second time. The hand-over posts one journal that moves the liability from Employee Payable to Payroll Payable and raises a Payroll-Payable open item for the claim. The run shows the claim as a line, and the salary payment batch pays that open item with the salary. The claim stays Payment Status Unpaid until the batch is paid; then it shows Paid and Status Settled.

After the run and its batch are paid, Payroll Payable for those employees is back to zero: each amount is accrued once and paid once.

When to use it

• Your organisation reimburses some claims together with salary.
• The claim's Reimbursement Mode is Payroll. Reimburse refuses those claims, so payroll (or an advance settlement) is how they are cleared.

Use Reimburse or a reimbursement batch instead when finance pays the claim straight from the bank. Those routes settle the claim and record the bank payment in one step.

How xMatix handles it

• Reimbursement Mode on the claim offers Finance payment and Payroll. Only Payroll changes behaviour. Final approval sets Status ApprovedForPayroll instead of ApprovedForPayment, Reimburse refuses the claim, and payroll picks it up.
• Calculate pulls claims in. When a run is calculated, every claim that is posted, not yet paid, has Reimbursement Mode Payroll, has the employee's Resource as claimant, belongs to the run's company and is not already in another run is pulled into the run for that employee. Employees the run skips (exited, no compensation) are not pulled.
• Once only. A claim is handed to payroll once. Recalculating the run carries the same claims again without posting them again.
• On the payslip. The employee's run row gets a line "Expense reimbursement <claim number>" with component type Reimbursement, not taxable. It sits after adjustments and before loan recovery. Gross Earnings, Reimbursement Amount and Net Pay include it, so the payslip lists it.
• Not accrued twice. Posting the run accrues salary only. The claim line is skipped because its amount is already on Payroll Payable.
• Paid with salary. Generate payment batch puts everything still open for each employee on the run — net salary plus the claims — on one batch line. Paying the batch settles both and marks the claims Paid and Settled.
• Settle via Payroll hands one claim over before Calculate. It does not check the mode, so check it before you run the action. If the action is given a payroll run, the claim is tagged to that run; without one, the next Calculate of the employee's run tags it and carries it.
• The amount moved is the claim's current open employee-payable balance, not the claim total. If part of the balance has already been cleared, only the rest moves.
• The hand-over journal is dated with the claim's Claim Date and posted for the claim's company and branch. Its narration reads "Claim … to payroll". Payroll Period and Payroll Component on the claim are not read.

Prerequisites

• The claim is posted (Posting Status Posted), has an open balance and has a Resource (the employee).
• The claim's company has a GL account with the Payroll Payable control type. Payroll posting needs the same account, so a company that already posts payroll runs has one.
• The employee is on the payroll run for the claim's company.
• For the optional early hand-over: Settle via Payroll has been added to the claim's record page header (see Configuration), and your security profile is granted the action.

Procedure

Step 1 — Check the claims waiting for payroll

1. Open Expense Claims and filter to Posting Status Posted and Payment Status Unpaid.
2. Check Reimbursement Mode on the Reimbursement tab. Payroll-mode claims are cleared by the run; keep them out of reimbursement batches, which do not check the mode.

Step 2 — Calculate the payroll run

1. Calculate the month's payroll run as usual.
2. Each Payroll-mode claim of an employee on the run is pulled in. Open the employee's run row: it shows a line "Expense reimbursement <claim number>", and Reimbursement Amount and Net Pay include it.
3. On the claim, Included In Payroll Run now names the run. Payment Status is still Unpaid.

To hand a claim over before the run is calculated, open the claim and select Settle via Payroll, then confirm the prompt "Hand the claim to payroll (Dr Employee Payable / Cr Payroll Payable)." The journal posts and the claim stays Unpaid. The next Calculate carries it. If the claim is not posted, has no open item, or was already handed to payroll, the action stops with a message and nothing is posted (see Common problems).

Step 3 — Post the run and pay the batch

1. Post the run. The posting accrues salary only; the claim lines are skipped.
2. Select Generate payment batch on the posted run. Each employee's batch line is net salary plus the claims the run carries, so the batch total can be higher than the run's posted net salary.
3. Pay the batch (see Salary payment batches). The claims become Payment Status Paid and Status Settled.

Step 4 — Check the result

• The claim shows Paid and Settled, and Included In Payroll Run names the run.
• The payslip lists "Expense reimbursement <claim number>".
• After the batch is paid, the Payroll Payable balance no longer includes the run or its claims.

Fields

These claim fields matter for the payroll route. The full claim field list is on Expense claims.

Business rules

• Posted claims only. A claim whose Posting Status is not Posted is refused.
• Open balance only. The open employee-payable item must exist and have a balance above zero. A claim already reimbursed, batch-paid or fully covered by an advance is refused.
• Once only. A claim already handed to payroll is refused by Settle via Payroll and is not posted again by a recalculation.
• Mode. Calculate pulls only Payroll claims. Settle via Payroll does not look at Reimbursement Mode.
• Amount. The open balance at the time of the hand-over, rounded to two decimals.
• Accounts. Debit is the employee-payable account the claim's open item was raised on. Credit is the company's Payroll Payable control account. The batch pays Dr Payroll Payable / Cr Bank.
• Not taxable. The claim line is not taxable, so it does not change the TDS projection or salary tax.
• Paid by the batch. The claim is Paid only when the salary payment batch that settles its Payroll-Payable open item is paid.
• Claims handed over before this release. They have no Payroll-Payable open item and remain Paid on the claim. Finance paid them by journal; nothing changes for them.

Example

An employee's travel claim TRV-0412 for 6,480 is approved and posted, with Reimbursement Mode Payroll. The company pays salaries on the last working day.

1. The payroll accountant calculates the October run. TRV-0412 is pulled in: a journal moves 6,480 from Employee Payable to Payroll Payable, and the employee's row shows "Expense reimbursement TRV-0412" for 6,480. Net pay is 42,300 salary + 6,480 = 48,780.
2. The accountant posts the run. The salary is accrued; the claim line is skipped.
3. Generate payment batch builds the batch. The employee's line is 48,780.
4. The batch is paid. The bank transfer to the employee is 48,780, TRV-0412 shows Paid and Settled, and Payroll Payable for this employee is zero.

Training

Practice exercise

In a sandbox company with a Payroll Payable control account and a payroll run for one employee:

1. Create and post an expense claim of 1,000 for that employee with Reimbursement Mode Payroll.
2. Try Reimburse on it. Expected: "Claim is set to reimburse via payroll; finance reimbursement is not applicable."
3. Calculate the run. Expected: the employee's row shows "Expense reimbursement <claim number>" for 1,000, and the claim's Included In Payroll Run names the run while Payment Status stays Unpaid.
4. Recalculate the run. Expected: the same line appears once and no second hand-over journal is posted.
5. Post the run, generate the payment batch and pay it. Expected: the employee's batch line includes the 1,000, the claim shows Paid and Settled, and Payroll Payable is back to its earlier balance.

Quick reference

• Post the claim first; payroll needs an open balance.
• Calculate pulls posted, unpaid Payroll-mode claims of the run's employees — once.
• The payslip shows "Expense reimbursement <claim number>", not taxable.
• Run posting accrues salary only; the claim is already on Payroll Payable.
• The salary payment batch pays net salary plus the claims.
• The claim stays Unpaid until the batch is paid.
• Settle via Payroll is only needed to hand a claim over early.

Permissions

A user without the grant does not see the button. See Security profiles.

Configuration

• Payroll Payable control account. One per company, with Control Type set to the stored value PayrollPayable. The form's Control Type list shows the spaced label, which posting does not match; see GL accounts — Configuration. Without it Calculate pulls no claims.
• Reimbursement Mode picklist. Ships with Finance payment and Payroll. Keep the stored value Payroll unchanged; the behaviour depends on it. On the claim record page the field is a free-text box, so change the mode on the New or Edit form instead.
• Claim header button. The standard claim header shows Evaluate Policy, Post, Edit and Delete only. Calculate does the hand-over without the button. To hand claims over early, add Settle via Payroll to the header actions of the claim's view layout in Design Studio (Design a form layout). It is not on the mobile claim screen.
• Action grant. Grant or remove Settle via Payroll on Expense Claim in each security profile's Actions tab.

Common problems

"Claim must be posted before payroll settlement."

The claim has not been posted. Post it (or finish its approval, which posts it), then settle.

"Expense claim must be anchored on a Resource before payroll settlement."

The claim has no Resource, so payroll cannot tell whose salary it joins. Set the employee's Resource on the claim.

"No open employee-payable item for the claim."

xMatix found no employee-payable open item for the claim, so there is no balance to move. Check the claim's posting journal with your finance team before you pay the employee another way.

"Employee payable is already settled."

The balance was already cleared by Reimburse, a reimbursement batch, an advance, or a Settle via Payroll from before this release. Nothing more is owed on this claim.

"The claim is already handed to payroll."

The claim was already handed over, by Calculate or an earlier Settle via Payroll. It is paid by the salary payment batch of its run; nothing more is needed.

"No Payroll Payable control account (GLControlType.PayrollPayable) is configured."

The claim's company has no GL account with the Payroll Payable control type. Tag one (see Configuration) and run the action again.

A Payroll-mode claim is not on the run

Check that the claim is posted and Unpaid, that its Resource is the employee on the run, that it belongs to the run's company, and that Included In Payroll Run is blank or names this run. An employee the run skips (exited, no compensation) has no row, so their claims are not pulled. Recalculate the run after fixing the claim.

The claim still shows Unpaid after the run was posted

This is expected. The claim becomes Paid when the salary payment batch is paid, not when the run posts.

Common questions

Does the reimbursement show on the payslip?

Yes. The run row carries a line "Expense reimbursement <claim number>", and Gross Earnings, Reimbursement Amount and Net Pay include it, so the payslip lists it.

Is the reimbursement taxed through payroll?

No. The line is not taxable, so it does not change the TDS projection or the salary tax for the month. How the expense itself is treated is decided by the claim and its categories in the expenses module. The Taxable Perquisite Flag on the claim is not read by payroll or by posting.

Does the salary payment batch pay it?

Yes. Each employee's batch line is everything still open for them on the run: net salary plus the claims the run carries. Paying the batch settles the claims and marks them Paid and Settled.

Is the claim posted twice if I recalculate?

No. A claim is handed to payroll once. Recalculation carries it again as a line without a second journal, and the run posting skips the line.

What about claims settled via payroll before this release?

They have no Payroll-Payable open item and remain Paid on the claim. Finance paid them by journal, and no batch picks them up.

Related topics

• Expense claims
• Reimburse expense claims
• Expense accounting
• Salary payment batches
• Running payroll
• Journals
• AR and AP subledgers
• Claim — entity reference
• Expense Claim — entity reference