Frappe HRMS – Chapter 5: Expense Claims

Part of the Frappe HRMS documentation series. | Upstream: github.com/frappe/hrms

The Expense Claims module handles employee reimbursements, cash advances, travel requests, and vehicle logs. It is fully integrated with ERPNext accounting — approved claims post directly to the general ledger via Journal Entry or Payment Entry.

1. Expense Claim Type

Purpose

Defines categories of expenses (e.g., Transportation, Meals, Accommodation, Tools & Supplies). Each type maps to a specific expense account and optionally sets a per-claim maximum limit.

Steps

Go to HR → Expenses → Expense Claim Type → New.
Enter Expense Claim Type Name.
Under Accounts, add the expense account per Company (e.g., 5400-000 – Employee Expenses).
Optionally set Maximum Claim Amount Per Employee if a cap applies.
Save.

2. Expense Claim

Purpose

The primary document for an employee's reimbursement request. Lists individual expense items with receipts, maps to expense accounts, and routes through a configurable approval workflow before disbursement.

Prerequisites

Expense Claim Types configured with accounts
Approver assigned to the employee (via Department Approver or HR Settings)
Original receipts / supporting documents

Steps

Go to HR → Expenses → Expense Claim → New.
Select the Employee.
Approver auto-fills from the department approver setup (can be changed).
Under the Expenses table, add each expense line:
- Expense Date
- Expense Claim Type
- Description
- Amount
- Attach receipt (file upload)
Add Taxes and Charges if VAT or withholding tax applies.
Under Advance Payments, link any outstanding Employee Advance to offset against this claim.
Save → Submit → Approver receives notification.

Approval Workflow

Approver reviews and either Approves or Rejects the claim.
If approved, HR processes payment via Payment Entry or Journal Entry.
On payment, the claim status updates to Paid.

Accounting Impact

Upon submission and approval:

Debit: Expense account (per Expense Claim Type)
Credit: Accounts Payable – Employees (or the configured default payable account)

On payment:

Debit: Accounts Payable – Employees
Credit: Cash / Bank

Next Step

Process reimbursement via Payment Entry linked to the claim.

3. Employee Advance

Purpose

Issues a cash advance to an employee before they incur expenses — common for travel or project assignments. The advance is later reconciled against an Expense Claim or returned if unused.

Prerequisites

Approved advance request from the department head
Available budget in the employee expenses account

Steps

Go to HR → Expenses → Employee Advance → New.
Select Employee.
Enter Purpose, Advance Amount, and Currency.
Set Advance Account (the clearing account used for advances).
Submit.
Process disbursement via Payment Entry → the advance status moves to Paid.

Reconciliation

When the employee submits an Expense Claim after using the advance:

Open the Expense Claim.
Under Advance Payments, link the related Employee Advance.
If claim amount > advance: employee is reimbursed the difference.
If advance > claim amount: employee returns the unused balance.
System marks the advance as Returned or Claimed accordingly.

4. Travel Request

Purpose

Pre-approval document for business travel. Captures travel itinerary, purpose, cost estimate, and routing for approval before any costs are incurred.

Steps

Go to HR → Expenses → Travel Request → New.
Select Employee and Purpose of Travel.
Enter trip dates and destination.
Under Travel Itinerary, add each leg (from/to, mode of transport, estimated cost).
Under Travel Costing, add cost estimates per category (airfare, hotel, per diem).
Submit for manager approval.

Next Step

After travel, employee submits an Expense Claim referencing the Travel Request.

5. Purpose of Travel

Purpose

A master list of valid travel categories (e.g., Client Visit, Training, Site Survey, Conference). Used as a field in Travel Requests for classification and reporting.

Steps

HR → Expenses → Purpose of Travel → New → Enter name → Save.

6. Vehicle Log

Purpose

Tracks company vehicle usage, mileage, and fuel costs per trip. Used for vehicle expense reporting and fleet management.

Steps

Go to HR → Expenses → Vehicle Log → New.
Select the Vehicle (license plate).
Enter Employee (driver), trip date, odometer readings (last and current), and purpose.
Record fuel quantity and cost if a fill-up occurred.
Save and submit.

Reports

Vehicle Expenses report: summarizes all costs per vehicle for a selected period.

Reports

Employee Advance Summary — outstanding advance balances per employee
Unpaid Expense Claim — approved claims pending payment disbursement
Vehicle Expenses — total fuel and service costs per vehicle

Related Chapters

Frappe HRMS — main index
Frappe HRMS - Ch07 Payroll — advances can also be recovered via salary deduction (Additional Salary component)
Frappe HRMS - Ch09 Philippine Localization — VAT and withholding tax on reimbursable expenses