Repaying a candidate's interview travel
How a recruitment agency pays back a candidate's interview travel, records the claim as a bill, and recharges the cost to the client on its invoice.
By Achekam · · 5 min read · For Recruitment businesses in South Africa, Nigeria, Kenya
A strong candidate lives four hours from the client's head office. The client wants to meet her in person for the final round and agrees to cover her travel. She takes a bus, two taxis and pays for a night in a guesthouse, and sends the agency a handful of photographed slips. Now someone has to pay her back, record it properly and make sure the client actually reimburses the agency.
Interview travel is a small amount of money with a surprising number of ways to go wrong. The candidate waits weeks to be repaid and tells her friends. The agency forgets to recharge the client. Or the cost is recharged, but nobody can find the slips when the client's finance team asks for them.
Agree who pays before the interview
Most problems are settled before anyone travels. Agree three things in writing:
- Who bears the cost. The client, the agency or the candidate. Many agencies' terms of business say that the client reimburses agreed candidate expenses; check yours.
- What is covered. Public transport or mileage, accommodation if an overnight stay is unavoidable, meals or not. Set a sensible cap.
- What evidence is needed. Tickets, slips, a booking confirmation, and a short claim form signed by the candidate.
Tell the candidate before they travel, in plain terms: what will be repaid, what they must keep, and when they will be paid. A candidate who knows the rules keeps the slips.
The candidate is not your employee
It is tempting to put the repayment through the same route as staff expenses. Do not. A candidate is not on the agency's payroll.
In Achekam, pay runs can be monthly, fortnightly or weekly, with each period's overtime, commission, allowances, reimbursements and unpaid leave entered as variable inputs. Those reimbursements are for employees on the agency's payroll. A candidate who is not employed by the agency should not be added to payroll just to be repaid travel; that would create an employee record, and possibly tax records, for someone who is not an employee.
Temps already on the agency's payroll are different. If a temp travels to an interview for a permanent role, discuss with your adviser whether to treat the cost as a payroll reimbursement or as a separate claim.
Recording the claim as a bill
Treat the candidate's claim like a supplier's invoice. A business keeps one supplier list with duplicate checks by name or VAT number, and bills pick suppliers from it. Add the candidate as a supplier when the first claim arrives; if you repay candidates often, consider one supplier record per candidate rather than a single "candidates" catch-all, so that each repayment can be traced to a person.
A business records supplier bills line by line with VAT. A bill without a purchase order waits for approval before it posts, and can be paid in full or in parts from a chosen bank account. For the candidate's claim:
- one line per item, described clearly: "Bus fare to client interview", "Guesthouse, one night";
- no VAT on a candidate's claim, since the candidate is not a VAT vendor charging you;
- coded to an expense account for candidate costs, so recharges can be compared with costs.
The approver should check each line against the agreed cover and the slips, then approve. Pay the candidate promptly from the chosen bank account, and record the payment against the bill.
Recharging the cost on the client's invoice
If the client agreed to reimburse, add the cost to the client's next invoice. A business creates customer invoices as drafts it can change or delete, and issuing one takes the next number in the sequence and posts it to the ledger as debtors, sales and output VAT.
Describe the recharge so the client's finance team can approve it without a call: "Candidate interview travel, final round, as agreed, per attached slips". Two points to know:
- Where it posts. Today all invoice revenue posts to one account, Professional Services Revenue (4100), and a line cannot name another sales account. The recharge therefore appears in the same revenue account as your fees, while the cost sits in your expense account. Compare the two each month to confirm every repaid claim was recharged.
- VAT on the recharge. Whether VAT applies to the recharged amount depends on your registration and your country's rules, and is not simply the same as the VAT on the candidate's slips. In Kenya, for example, KRA's guide to understanding VAT input tax deduction explains that input tax can be claimed only against a valid electronic tax invoice carrying the buyer's PIN that was transmitted to KRA, so a bus ticket bought by a candidate will not support a claim. Agree the treatment with your adviser once and apply it every time.
If a recharge was missed on an invoice already issued, raise it on the next invoice rather than altering the old one. A posted journal is corrected only by a reversal, and issued invoices should be left as issued.
Keeping the receipts with the claim
The slips are the evidence for the bill, for the recharge and for any later question from the client or the tax authority. Document Centre is a folder-based store where a business uploads files or whole folders, previews, downloads, renames, moves, tags, archives and searches them, and a new version keeps the earlier ones.
Keep a folder per client or per vacancy, and file the candidate's claim form and slips there, named with the candidate and the date. When the client asks for the evidence behind a recharge, send it from that folder the same day. Advertising costs recharged to clients follow a similar pattern; see recharging advert costs. Day-rate contractors' invoices are handled differently again, as covered in paying day-rate contractors.
A candidate expenses checklist
- Cover and evidence agreed with the client and told to the candidate before travel.
- Claim recorded as a bill against the candidate as a supplier.
- Bill approved against the agreed cover and slips.
- Candidate repaid promptly and the payment recorded.
- Cost recharged on the client's next invoice, with a clear description.
- Slips filed with the claim in Document Centre.
Write a one-paragraph candidate expenses policy this week, add it to your terms of business with clients, and send it to the next candidate before they book their travel.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
