A reimbursement is a sum of money granted by a company or organization to compensate an employee’s out-of-pocket expenses or any excess payments made by customers or other parties with whom the business conducts business. Simply explained, reimbursement is the money you get back from a previous transaction in which you made a payment for someone else or purchased something for yourself.
Common instances are the reimbursement of business expenses, insurance premiums, and overpaid taxes. Contrary to conventional pay, reimbursement is not taxed.
The most frequent association of reimbursement is with business expenses. Numerous businesses have policies describing when they will pay employees back for out-of-pocket spending. These costs are typically connected to travel and can include the price of lodging, meals, ground transportation, and flights (travel reimbursement).
Companies may also pay for additional costs incurred by employees, such as continuing education courses or college tuition.
Also, See: Medical Reimbursement
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