Reimburse

Reimburse means to repay someone for money they have spent on behalf of another person or organization. It is the act of restoring a financial outlay to the payer, rather than providing a new source of funds. Reimbursement is distinct from a loan, a grant, or a discount; it is normally compensation for expenses already incurred.

Reimbursement commonly occurs in business, government, and healthcare contexts. In organizations, employees may be reimbursed for travel, meals, lodging, or other approved business expenses after submitting receipts or expense reports. In healthcare, providers or patients may be reimbursed by insurers or government programs for eligible services or medications. Reimbursement is also used in consumer contexts when returning purchases or reclaiming costs under warranties, though that usage is often termed a refund or credit.

Process and documentation typically involve itemized receipts, expense descriptions, dates, and adherence to policy. Submissions are reviewed for eligibility, caps, and policy compliance, then approved and paid within a defined timeframe. Some organizations use per diem rates to simplify routine travel reimbursements, while others require full substantiation of costs.

Accounting and tax implications vary by jurisdiction. Reimbursements that are properly documented and based on an accountable plan are usually non-taxable to the recipient and do not count as income, whereas unsubstantiated or excess reimbursements may have different tax treatments.

Best practices include clear reimbursement policies, timely submissions, standardized forms, secure records, and audit trails to ensure fairness, accuracy, and compliance.