This guide covers: submit an expense or mileage claim as an employee, review and approve as an employer or accountant, how approved amounts are paid back and taxed, mileage rates, receipts, and the 1099-contractor exception.
Submit an expense (employee)
What it does: Lets an employee claim an out-of-pocket business expense so an approver can pay it back on a paycheck.
Where: Employee portal → Expenses (web or mobile).
Steps:
- Sign in to the employee portal and open Expenses.
- Click New Expense and pick a Category (for example Travel, Meals, Supplies).
- Enter the Date, Amount, and Purpose (a short business reason).
- Attach a receipt — snap a photo or upload a file. A receipt is required for dollar expenses.
- Click Submit. The expense shows as Pending until an approver reviews it.
Who: Employee, signed in to the employee portal.
Notes: On mobile, the camera opens straight from the receipt field — an iPhone photo works fine. Accepted file types: jpg, png, pdf, HEIC.
Submit mileage (employee)
What it does: Lets an employee claim a business trip and have the system compute the reimbursement at the IRS standard mileage rate.
Where: Employee portal → Expenses → New Expense → Mileage.
Steps:
- Choose the Mileage category.
- Enter the trip date, the From and To locations, and the miles — or enter odometer start/end and let the system subtract.
- Add a Purpose for the trip.
- Click Submit. The amount is computed for you at the IRS standard rate for the trip date — no receipt needed for mileage.
Who: Employee.
Notes: The system picks the rate by trip date. For 2026 the IRS standard rate is 72.5¢/mile for trips Jan–Jun and 76¢/mile for trips Jul–Dec, so a mid-year trip and a year-end trip can compute at different rates.
Review and approve (employer or accountant)
What it does: Lets an approver review pending expenses and decide whether — and how much — to reimburse.
Where: Accountant dashboard → Expenses or Client portal → Expenses.
Steps:
- Open the Pending list. Each row shows the employee, category, date, amount, purpose, and the attached receipt (or the computed mileage detail).
- Open an expense to view the receipt.
- Click Approve to approve the full amount, or enter a partial amount to approve less than claimed.
- Set how much of the approved amount, if any, is taxable (see the next section).
- Or click Decline and enter a reason; the employee is notified.
Who: Accountant (dashboard) or client owner / manager (client portal).
Notes: Approved expenses flow into the next payroll run for the employee. Declined expenses can be corrected and resubmitted by the employee.
How it's paid and taxed
What it does: Adds approved reimbursements to the employee's pay, taxed or untaxed depending on the client's plan and whether the expense is substantiated.
Where: Applied automatically on the next payroll run after approval.
Steps:
- Approve the expense (above). The amount is attached to the employee's next paycheck.
- A qualified accountable-plan reimbursement is non-taxable — it's added to net pay and does not appear on the W-2.
- If the expense can't be substantiated (for example no receipt) or the client hasn't set up an accountable plan, it's treated as taxable wages and runs through withholding.
- Commuting between home and work is always taxable.
Who: The employer / accountant decides the plan setup and the taxable portion per expense.
Notes: Tax treatment is the employer's and accountant's call and should be confirmed with your accountant. Payrollix applies what the approver sets — it doesn't decide accountable-plan eligibility for you.
1099 contractors
What it does: Clarifies who this feature is for.
Where: Not applicable to contractors.
Steps:
- Expense reimbursement is for W-2 employees only.
- Contractor reimbursements go through invoicing, not payroll.
Who: Employees use Expenses; contractors bill reimbursable costs on their invoices.
Notes: Running a contractor's costs through payroll would mis-report wages — keep them on the contractor's invoice.
Related: Timesheets · Off-cycle, bonus & correction payrolls.