Concerning international mileage and expenses ...

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Q. (cont.) 

What is a good source to find information regarding: 

International mileage--where can we find the rates by country so we can implement?
International expense reports--where can we find the information by country if we need to have hard copies stored somewhere, and if so, do they need to be stored in-country or not?

 

A.  Rotary International offers a PDF with 2017-2018 automobile reimbursement rates by country here: https://my.rotary.org/it/document/automobile-reimbursement-rates. (This link will download a PDF to your computer.) The organization does a very good job of keeping this information up-to-date each year.

As to your question about international expense report record retention, I expect every country has its own rules and guidelines governing expense reimbursement, though from your point of view, as a U.S. payer (and assuming the travel expenses in question are in support of your business), I’m not sure that you must do more than observe IRS accountable plan rules on the U.S. side; and that each of the payees would individually be responsible for appropriate reporting (and documentation) on their side. That could mean in some countries that they need to hold onto original receipts, but the IRS accepts electronic records, so that should not present an issue on the documentation side.  (Of course, you want to have appropriate management review/authorization for the travel expenses in place.)

Here are comments from one of our global experts:

“Every country does have rules about T&E, such as amount thresholds for receipts, what is considered a T&E receipt, where receipts need to be kept, how long to keep receipts, and whether the reimbursement is perceived as personal income. For example, Puerto Rico requires the T&E amount to be sent on a 1099 and the employee has to provide the government with original receipts at year-end tax time. Italy does not allow original receipts to leave the country ... and penalties could include jail time for executives! 

“If you have such a large number of countries you are supporting, we would suggest you consider hiring a VAT recovery group like Meridian, which focuses on T&E VAT recovery, and will know what each country requires and can keep you updated.  Meridian or other such expert should be able to help you set up and review the existing records to ensure you are compliant.”

As far as resources for new AP team members, AP & P2P Network membership offers abundant resources to address the needs of AP pros at every level of expertise. A site search will turn up articles on topics of interest. Each month, there are a number of webinars available that your team may participate in -- on various topics in professional development, compliance and automation. (Those are available on the site under the link “Events.”) If there is a chapter meeting nearby, that’s an excellent way for them to get to know others in their new field and develop resources and mentoring relationships to get questions answered (https://www.iofm.com/chapters/). I also highly recommend Accounts Payable Specialist training and certification: https://www.theaccountspayablenetwork.com/certification/.

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