Does a Cash Float come out of wages?

StevenB12

Hey guys,

I know this is probably something better off asking my company (I'm still awaiting reply on the subject). I've recently started my new job which requires a lot of travel and staying over night in hotels etc, the company pays for the hotel, parking costs, breakfast and dinner, usually you pay for this and then hand in your receipts and you receive the money back mid month and end of the month (so 2 weeks of receipts mid month obviously, and the other 2 weeks at the end of the month).

I received an email from the credit control section today saying that they were paying me back 2 weeks worth today, as well as a cash float of 200 pound, which is to cover expenses for the remainder of the month, with the cash float being topped up when it starts to run low or it runs out.

Does this cash float come out of your wages generally if any one knows? Since in theory it is my wages paying for the expenses but then just reclaiming that back, so is it a case of 200 pound coming out of my wages per month, but then being paid back as and when the next month?

Thank you.

SensibleSarah

I've only worked in one place that used a cash float system and no it didn't have anything to do with wages, the money was essentially there so that the employee wasn't out of pocket before claiming back expenses. Obviously all receipts had to be kept for anything used from the float, but assuming it all tallied up then it was basically just a pot of money used for expenses and topped up by the employer when it was needed - usually once a month in our case. Saved all the paperwork of expense claims and meant that employees didn't undergo hardship when waiting for expenses to be paid back.

TBagpuss

I would expect it to be money paid on account of expenses, not an advance on salary, however your contract may well include a provision allowing them to deduct money from your final salary to cover any amount paid out as a 'float' and not paid back or accounted for with receipts, so that they've covered their backs and someone in your position can't walk off with £200 at the end of the contract!

Savvy_Sue

And my advice would be to get a separate purse or wallet for it, only EVER use it for work expenses and ALWAYS put the receipt there.

(We used to run this system at work for some staff, and the only ones who could ever balance it used this system.)

StevenB12

Thank you all, sorry for the late replies.

I asked a colleague about it at work and he basically said the same. More or less what happens is you get the 200 and that covers you for a month and when you hand your receipts in they just top that money back up once it gets to a certain point.

He said you could use it for yourself for out of work expenses say if you needed something for shopping etc as an example, as long as you replace that money from your pay. It's not something that they account for from receipts as such apparently.

You need to keep and hand in all receipts, but they dont ask to see where the money has gone so say if my monthly expenses were about 120, and I had to use 30 before pay day, they will assume you have 50 left, and then send you over 150, so in essence as long as you are putting the money back that you spend outside of work you are fine. Hopefully I don't have to haha.

getmore4less

Might be easier to think of it as a cash advance.

you owe the company £200

They pay your claimed expenses

when you leave you give them back the £200.

If you need more to cover the cash expenses then you might need more than £200 but most just put everything they can on cards and make use of the interest free period to cover the gap between paying the money and getting the expenses money back.

Savvy_Sue

StevenB12 wrote: »

I asked a colleague about it at work and he basically said the same. More or less what happens is you get the 200 and that covers you for a month and when you hand your receipts in they just top that money back up once it gets to a certain point.

He said you could use it for yourself for out of work expenses say if you needed something for shopping etc as an example, as long as you replace that money from your pay. It's not something that they account for from receipts as such apparently.

I really am struggling to get my head round what you've written here. Especially the bit I've put in bold.

My understanding was that if the company could not justify expenses paid, then HMRC can legitimately tax you on them. So if the company aren't asking for receipts, I'm not sure how they could prove to HMRC that they're reimbursing legitimate expenses, and not just bunging you an extra TAXABLE £150 or quid or so.

StevenB12 wrote: »

You need to keep and hand in all receipts, but they dont ask to see where the money has gone so say if my monthly expenses were about 120, and I had to use 30 before pay day, they will assume you have 50 left, and then send you over 150, so in essence as long as you are putting the money back that you spend outside of work you are fine. Hopefully I don't have to haha.

so you send in receipts for £150, and they send you £150 in cash, but £30 of those receipts are for non-work related expenses? Seriously?

If I'm missing something, blame it on the day I've spent learning about procurement ...

TyreLever

Savvy_Sue wrote: »

I really am struggling to get my head round what you've written here. Especially the bit I've put in bold.

My understanding was that if the company could not justify expenses paid, then HMRC can legitimately tax you on them. So if the company aren't asking for receipts, I'm not sure how they could prove to HMRC that they're reimbursing legitimate expenses, and not just bunging you an extra TAXABLE £150 or quid or so.

so you send in receipts for £150, and they send you £150 in cash, but £30 of those receipts are for non-work related expenses? Seriously?

If I'm missing something, blame it on the day I've spent learning about procurement ...

You're not missing anything, that is correct.

StevenB12

No no,

What I'm saying is,

Say if I gave you 200 pound for work related expenses that were going to come up through the month, such as food etc if you were working away. If you spent 50 pound out of that 200 on your own things, then you aren't going to send receipts in for that are you? But you would replace that money from your own wages once you get paid. The other 150 you are sending receipts back for. Because that's all you've spent from your work float, on work related items. So they will claim tax/vat back on those receipts obviously. But just because you're getting 200 doesn't mean you have to always have 200 worth of receipts to send back, it's not a necessity that you are going to spend that much every month.

Basically that 200 pound as all have said is a cash advance so you aren't out of pocket from your own wages, but if you had to borrow money from that float then you are putting your own money back into it.

Ames

Viewing your cash float as a line of credit that you can dip into and repay is a really bad idea.

Smodlet

Very sorry indeed but I would not give a penny in advance to someone who does not know what a cash float is. I would stick with the old method and make you claim it back with receipts. Since this is not going to happen, assuming you always have the correct receipts for the amount you are claiming, I hope it will teach you to have a slightly less cavalier attitude towards money that does not belong to you.