Employee-paid business purchases · AU
How do I record an employee reimbursement without counting the expense twice?
Short answer
Record the approved business purchase once, with an amount owed to the employee. Match the reimbursement payment against that amount rather than recording another expense. Keep the supplier receipt, business purpose, approval and payment reference together.
Detailed answer
Create an approved claim before paying the employee
An employee’s bank transfer request does not explain what the business bought. Ask for the supplier receipt or invoice, purchase date, business purpose and the amount being claimed. Give each claim a unique reference and identify any personal portion that the business will not reimburse. The approver should check whether the purchase was already paid using a company card or submitted on an earlier claim. If the receipt is missing, keep the claim unresolved until the evidence and accounting treatment have been reviewed. Do not assume a bank statement alone establishes eligibility for a GST credit.
Clear the employee balance rather than creating another expense
For accrual bookkeeping, an approved purchase generally records the appropriate expense or asset and a corresponding amount payable to the employee, with any GST component assessed separately. When the reimbursement leaves the business bank account, allocate it against that payable. For example, an approved AUD 86 purchase creates an AUD 86 employee balance; paying AUD 86 should reduce that balance to zero, not add another AUD 86 expense. Reconcile the employee schedule to the ledger and investigate old unpaid claims. If reimbursements are processed alongside wages, keep them identifiable and ask your adviser whether any payroll or fringe benefits treatment needs consideration.
Official sources
Published by Expert Bookkeeping Services · Last updated 2026-11-01. General information only — confirm specifics for your situation with a qualified adviser.
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