Business goals do not just slide effortlessly from one phase to another. A lot of iron-clad measures have to be implemented to bridge the chasm between the current state and future business anticipations. Notably, most of the programs implemented to give various business processes a leg up, such as benchmarking with industrial leaders, attending conferences, and team-building activities, require journeying either locally or internationally.
Traversing across cities to explore workable business ideas is almost pathologically helpful in achieving business growth and success. However, despite being universally appealing, business travels cost significant amounts of money. And can break the bank if not well executed.
Unraveled in the subsequent paragraphs are ways to run your finances when traveling proficiently.
1) Formulate a business travel policy
No matter how minimal you anticipate to make your travel expenses, some policy will make a big improvement in your finance management as opposed to no policy at all. The policy does not have to be perfect at first. The plan can at least approximate what you should incur in terms of finances while traveling, and then kick the tires over time, comparing it to your expectations.
By having a travel policy to get your expenses while journeying for various business functions, you discover that things fall in place more easily than if you dive into spending uncontrollably. Additionally, business travel guidelines give you a framework that is easier to build and reconsider over time. You can quickly delineate where you are falling short in your finances, then go back and fix portions of your policy that do not work.
2) Restrategize your flight and accommodation plans
Flights and accommodation plans have traditionally been relegated to prominent contributors to ballooning business travel expenses. They generally cost high compared to other implements required to accomplish a journey.
Nevertheless, by being a bit prudent, businesses can catch flights and secure accommodation at more affordable rates. For instance, a general tip to keep in mind when securing accommodation is the utilization of timeshare or travel accounts. If you are confident that your team will be spending a week or two at an annual event, then buying timeshares can save you quite a lump sum on accommodation.
On the other hand, you have to be smart when booking flights. For example, you can book your flights months in advance, fly domestically on less busy days, opt for early morning flights that tend to be cheaper compared to midday departures, to mention but a few.
3) Track and manage expenses incurred on travel
Waiting till the end of the journey to asses the costs incurred during business travel is a reactive rather than proactive approach to running finances. Thus, review your costs by keeping track of the expenses to fine-tune where the business money goes when a team is out on a company mission.
Tracking and managing costs incurred on travel can be made simpler by leveraging different software management solutions readily available in the market, such as Expensify, SAP Concur, and Shoeboxed. Using such implementations, your employees can record and store digital copies of their receipts in real-time. Letting you manage transactions as they happen.
Additionally, software management solutions can help you track excessive spending and prevent travel policy violations.
4) Learn and take advantage of deductible travel expenses
You cannot just jump on the next plane to the Bahamas to vacay and count that as a business travel expense. We advise against tracking your vacation days and deducting them from your business taxes as that might get you on the wrong side of the law.
When it comes to deductibles, consider the costs incurred when you were away from your tax home on business. This is because traveling for work is technically considered not a business trip until you leave your tax home for a certain duration of time, which is more prolonged than a workday.
Examples of tax deductions that you can claim from your business travel expenses include;
- Plane, train, and bus tickets between your tax home and destination
- Accommodation costs
- Business meals
- Laundry and dry cleaning services during the business trip
- Baggage fees
Notably, you need to plan your trip in advance and mostly engage in business while on the trip. The deductible rules vary based on your location.
Overly, presiding over your business finances when traveling all boils down to working from a well-formulated plan. Whether it is tracking expenses, strategizing the essentials involved in your travel, or deducting business travel expenses, everything needs to be documented before implementation.