Track business expenses: how to take control of spend and reduce taxes

Key takeaways

• Tracking business expenses helps you stay compliant, reduce your tax bill, and make smarter financial decisions.

• From spreadsheets to spend management platforms, the right tools make it easier to manage expenses as your business grows.

• With Airwallex Spend you can get real-time visibility over company expenses, automate reporting, and manage budgets in one place.

You probably know how much you’re spending, but do you know exactly what you’re spending on?

Expense tracking is something that many business owners delay. Receipts pile up. Spreadsheets go stale. And when tax time rolls around, the scramble begins. Yes, expenses involve admin, but they’re the key to better budgeting, smarter decisions, and lower tax bills.

Whether you’re managing a lean startup or scaling globally, knowing how and why to track your business expenses properly will save you time, money, and stress. And thanks to modern tools, it’s never been easier to stay on top of spend without getting buried in paperwork.

In this guide, we’ll break down what counts as a business expense, how to track them efficiently, and how smart expense management can unlock new savings and insight. We’ll also show you how Airwallex helps businesses get a real-time view of their global spend, all in one place.

What are business expenses?

Business expenses are the everyday costs you incur to keep your company running. Think of them as the necessary outgoings that support your operations, help you generate revenue, or fulfil legal and tax obligations. If you couldn’t run your business without it, there’s a good chance it counts as a business expense.

These expenses can be fixed or variable, recurring or one-off. Some reduce over time as you grow more efficient, while others scale with your business. And if you want a clearer view of which costs are directly tied to delivering your product or service, it’s worth taking time to calculate cost of sales alongside your broader expense categories.

Common examples include:

• Office supplies like stationery, furniture, laptops, and printer ink

• Travel costs, such as flights, accommodation, car hire, or taxis for business trips

• Marketing and advertising spend, from paid social to agency retainers

• Software subscriptions for accounting, people management, project management, or design tools

• Utilities and rent for your office or working space

• Professional services, including legal, tax, or consulting fees

• Employee benefits like training allowances, insurances, or stipends for remote work setup

In most cases, these expenses are also tax-deductible, as long as they’re legitimate business costs.

Why tracking business expenses is important

Tracking your business expenses is essential if you want to stay in control of your finances. When you can see exactly where your money is going, you can plan more effectively, reduce or optimise costs, and make faster, better-informed decisions.

It also helps you manage cash flow. You’ll spot trends early, compare actual spend against budgets, and course-correct before small issues become bigger ones. If you’re a startup or scaling business, it can help you understand how long your cash will last and assist as you calculate burn rate and plan your runway with more clarity. Accurate expense data gives you confidence whether you’re trying to cut costs, invest in growth, or report to investors.

Then there’s tax. If your records are messy or incomplete, you could be leaving money on the table, or inviting trouble with the tax office. Clear, consistent tracking helps you claim legitimate deductions, avoid compliance risks, and get through tax season without stress.

Methods to track business expenses

There are several ways to track expenses. Some will make month-ends easier, and some may make them a lot more difficult. Here’s the most common methods, and how they compare.

Spreadsheets: These are often the first step in tracking expenses. You keep your receipts and input everything manually, usually in Excel or Google Sheets.

Accounting software: Tools like Xero and QuickBooks allow you to track expenses alongside invoices, income, and reporting. They’re great for financial visibility, especially when connected to your bank account.

Expense tracking apps: These mobile-friendly tools let your team snap receipts, tag categories, and submit claims on the go. They’re handy for managing out-of-pocket purchases.

Corporate cards: Cards offer a smarter way to manage team spending. With the right provider, you can issue cards instantly, set spending limits, and track every transaction in real time.

End-to-end spend management platforms: These systems combine card issuing, expense tracking, approvals, and reconciliation into a single platform. They offer full visibility over company-wide spending, across currencies, teams, and tools.

How tracking expenses lowers your tax bill

Every eligible business expense you claim reduces your taxable income. That means lower tax bills and more money to reinvest in growth. But to take full advantage of those deductions, you need clear, accurate records.

Tax laws vary by country, but the principle is the same: you pay tax on profit, not revenue. And profit is calculated by subtracting your business expenses from your income. The more legitimate expenses you can document, the less tax you owe.

Let’s say you run an agency and bring in $200,000 in annual revenue. If your deductible expenses total $50,000, your taxable income drops to $150,000. That’s a significant saving, and it adds up year after year.

Tracking expenses properly means:

• Capturing every deductible cost, which can vary from region to region

• Categorising spend accurately to support tax filings

• Storing digital receipts in case of audit

It also makes life easier at year-end. Instead of scrambling to reconcile months of ad hoc spending, you can generate a clean report that shows what you spent, when, and why. If you use tools like Airwallex Spend or Corporate Cards, that data’s already there, ready to go.

Obviously, expense tracking is good financial hygiene, but it’s a powerful way to reduce liabilities, stay compliant, and keep more of what you earn.

Creating expense reports

A good expense report captures the what, when, who, and why of every business purchase. Done properly, it gives you a clear picture of your spend, keeps your team accountable, and helps you stay compliant at tax time.

The process typically looks like this:

1. Collect transaction data from receipts, card activity, or bank feeds

2. Categorise expenses by type, team, or department

3. Add context, including the business reason and any required approvals

4. Compile the report by person, project, or period

5. Review and approve according to your internal policy

6. Store and submit the final report for bookkeeping or tax purposes

Trying to pull this together across multiple tools is where most teams get stuck. When expenses, receipts, and approvals live in different places, the reporting process slows down, and so does your month-end.

With Airwallex, you can track spend across cards, teams, and categories in real time. Reports are built as you go, with every transaction matched to a user, receipt, and budget line. You can filter by team, export in seconds, and approve spending without ever opening a spreadsheet.

How to reimburse expenses

Even with company cards in place, there’ll always be times when employees pay out of pocket. When that happens, you need a simple, reliable process for expense reimbursement.

Here’s what that process should look like:

1. The employee submits their claim with a receipt, date, amount, and business reason

2. The manager or finance team reviews the claim and approves it

3. The reimbursement is recorded and paid, ideally within a set time frame

4. The expense is logged and categorised for reporting and tax purposes

Clear policies make this much easier. Be specific about what counts as a reimbursable expense, how claims should be submitted, and what proof is required. Add guidance on limits, timelines, and approval steps. The more clarity you give upfront, the fewer delays or disputes you’ll need to deal with later.

Fast processing matters. If someone pays for a hotel on a business trip, they shouldn’t have to wait weeks to get that money back. Quick reimbursements build trust and show your team that their time and money are respected. They also keep employees more engaged in the process, which improves accuracy and compliance.

To manage reimbursements efficiently:

• Use digital forms or a mobile app to submit claims. Technology such as OCR extraction can pull receipt data automatically, avoiding manual entry errors.

• Set reimbursement cycles (e.g. weekly or fortnightly) so employees know what to expect. Integrated expense management systems with payment systems make the payment process smoother.

• Link approvals to managers or department heads for faster sign-off. Pre-set approval workflows can streamline and expedite this process.

• Log all reimbursed expenses in your tracking system for accurate reporting. Integrations with accounting software help with automatic reconciliation, saving your team time.

Make expense tracking work for your business

Tracking expenses is all about control. When you can see what’s being spent, where, and by whom, you make better decisions. You stay compliant, avoid surprises, and keep your team focused on growth instead of paperwork.

Whether you’re managing expenses across a few freelancers or an international team, the right tools make a world of difference. And the sooner you build that system, the easier it becomes to scale with confidence.

If you want real-time visibility, fewer headaches, and a more empowered finance team, here’s where to start.

Track global business expenses in real time with Airwallex

Airwallex Corporate Cards help you take control of company spend, wherever your team works. You can instantly issue multi-currency Visa cards with built-in spending limits, approval workflows, and automatic transaction tracking, all from a single dashboard.

You’ll be able to track every purchase in real time, avoid fees on international card spend, and set per-transaction limits to reduce the risk of overspending. It’s everything you need to manage team budgets with confidence and transparency. No more waiting for receipts or chasing spreadsheets. With Airwallex, expense tracking becomes part of the way your business works – fast, accurate, and always up-to-date.

Frequently Asked Questions (FAQs)

How do I choose the best expense tracking method for my business?

It depends on your size, budget, and how your team spends. Spreadsheets work for solo founders, but growing businesses often need real-time tools like expense apps or spend platforms.

What happens if I don’t track my business expenses properly?

You risk missed tax deductions, budget overruns, and compliance issues. Poor tracking can also slow down reporting and affect financial planning.

How can I simplify the process of tracking and managing expenses?

Use tools that bring cards, receipts, and approvals together in one place. Automating tracking with a platform like Airwallex cuts down admin and improves accuracy.

What should I include in an expense report?

Each report should include the date, amount, category, business reason, and a receipt or proof of payment. Consistency is key. Use the same format and categories across the team.

How often should I review business expenses?

At least monthly, or more frequently if your business has high spend volume. Regular reviews help you stay on budget and spot issues before they grow.