Client Reimbursements are purchases that you have made in the course of working for a Client, that they have agreed to reimburse you for in full for. 

Client Reimbursements are not subject to tax deductions, and cannot also be raised as Business Expenses, as they are a full reimbursement for any costs you have incurred. Effectively, your client is making sure you are not out of pocket for anything purchased whilst working for them - so there are no tax reductions or tax relief applicable.

Some examples of the sorts of things that might be Client Reimbursements: 

If you Invoice Clients using Hnry:
Any Client Reimbursements you create in Hnry are automatically added to the next Invoice you raise to that Client.

If you do not use Hnry to raise invoices:
Any Client Reimbursements raised against a Client will be factored into the next payment from that Client, if it is of a higher value than the expense amount (e.g. if you raise a Client Reimbursement for $50, the expense will only be applied when your Client makes a payment of greater than or equal to $50). 

When that Invoice is paid, the value of that expense will be passed through to you in full, with no taxes deducted.

How do I create a Client Reimbursement?

1. Go into your dashboard and head over to the Expenses screen: 


2. Select the green '+ NEW' button on the right 


3. In the first drop-down, change the Expense Type to 'Client Reimbursement' and select the Client that will be reimbursing you

4. Uploading a receipt is optional, however your Client may ask you to send a receipt as proof of purchase along with your Invoice. If you are unsure, check with your Client before invoicing them.


5. Add a description for the Expense (this will appear as an invoice line on your next invoice to this client) and add in any other relevant information

N.B. You should add in any applicable GST on this expense, regardless of whether or not you are personally registered for GST. Your client may be GST-registered and may want to claim the GST relief on this expense themselves.

N.B. If you are charging a mark-up on your purchases then any profit you make needs to be declared as income. 

If you are not wanting your client to see your mark-up on their invoice then we suggest the following approach:

  • Invoice the customer for the full amount of your fees, plus any mark-up you are making i.e. Charge $100 (to cover $70 for your costs and $30 for you). 
  • As you will be charged income tax on the full $100, you will need to raise a Business Expense under the 'Cost of Goods Sold' category of $70 to recoup the income tax on that portion (i.e. once the expense is processed, the system will automatically adjust to make sure you don't pay income tax on $70 from your next lot of earnings).

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