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Brits lose £140m a year in unclaimed work expenses

Millennials are disproportionately left out of pocket. Photo: Dominic Lipinski/PA Wire/PA Images

Brits miss out on £140m a year in unclaimed work expenses, rather than endure long and complex expense claim processes, according to new research.

A survey of 1,000 British workers at small and medium-sized enterprises (SMEs) by Soldo found almost four in 10 (38%) people haven’t claimed reimbursement on a work item they purchased using their own money in the last 12 months.

The research shows millennials are disproportionately left out of pocket. Two thirds (66%) of 18 to 34-year-olds said they purchased items with their own money and not claimed it back.

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By comparison, only a third (30%) of 35 to 54-year-olds and 23% of those over 55-years-old said they have encountered this problem in the past year.

Employees at marketing, PR, advertising, and market research firms are most likely to be left out of pocket due to not claiming back, at 66%. These fields also have the highest average value of unclaimed expenses, at £65.75 per year — more than double the overall average of £31.99.

On a national scale, the value of unclaimed expenses across UK SME employees totals an estimated £137,171,252 per year.

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Of those employees that choose not to claim back expenses, the most commonly cited reason — given by 38% — was that the current expense reporting process in their company is too complex or time-consuming.

The average employee spends 20 minutes per week submitting expense claims, which is equivalent across the UK SME community as a whole to more than 1.4 million hours per week — or 189,146 working days.

However, 28% said their main reason for not claiming back expenses is they forget to keep receipts. When asked what happens if someone at their company loses a receipt, a third (30%) said staff simply “can’t claim back the expense,” and the company doesn’t have a system in place to help prevent this happening.

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When they do manage to claim expenses, employees may have to wait a long time to get their money back. A third (34%) said they have to wait at least a week to be reimbursed, while a small number (5%) said it usually takes over a month.

Nicholas Agwuncha, 27, a financial services professional, said it took him a month to be reimbursed for £745 worth of expenses when working at a consultancy firm.

Working until 11pm each day on a three-week project, he racked up a significant cost on food delivery and taxi rides.

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“The firm in question had quite an archaic expenses system, which involved filling in your details on an Excel spreadsheet within a specific time period. This was a very time-consuming process and, having already worked late, I wasn’t prepared to start using my weekend to manually put my receipt details into a spreadsheet,” Agwuncha said.

“Upon submitting the details, the firm required paper receipts of my food bill, which had at that point become faded and illegible.”

After weeks of back and forth, Agwuncha’s project manager had to attest that he had worked those long hours.

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“It was a demotivating experience because you would expect that after working those long hours, the firm would be quick to pay what is owed to you,” Agwuncha said.

“Firms should adopt better technology that documents expenses in a consistent way, to avoid unnecessary admin.”