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Excel workbook (.xlsx) with formulas that total themselves. Opens in Excel, Google Sheets, or Numbers.
Download the UK expense report (Excel)An expense report is how out-of-pocket and card spending gets turned into clean, postable figures. In the UK the report has one job most people underestimate: separating the VAT. Get the net, VAT, and gross split right and a VAT-registered business reclaims the VAT and posts only the net cost. Get it wrong, by lumping everything as a gross total or assuming 20% on a zero-rated train fare, and the VAT return inherits the error. This template builds the split in, with a 20% VAT column and worked examples.
The download has a header block for the employee, period, and approver, a line per cost with the date, description, category, merchant, net, VAT, and gross, and a totals row.
The VAT column is the point
The UK standard VAT rate is 20%, and most business purchases carry it, so the template defaults to a 20% column. But the rate is not universal. A reduced rate of 5% applies to domestic energy and a handful of items, and a zero rate of 0% applies to most food, books, children’s clothing, and rail and public transport. The worked example deliberately includes a zero-rated train fare so the pattern is visible: you record the VAT actually charged, which on that line is nothing.
This matters because reclaiming VAT you were never charged is an error HMRC will unwind. The discipline is to read the VAT off each receipt rather than assume.
You need a VAT invoice to reclaim
A VAT-registered business reclaims input VAT, but only against a valid VAT invoice showing the supplier’s VAT number and the VAT charged. A bare card receipt with no VAT breakdown does not support a reclaim, though simplified VAT receipts are fine for smaller amounts. The template’s gross column captures what was paid; the VAT column should only carry a figure where a valid VAT invoice backs it.
Net, VAT, and gross
The three columns each do a job. Gross is what was paid. Net is the cost excluding VAT, which is what posts to the profit and loss. VAT is the slice the registered business reclaims rather than expenses. Splitting all three means the bookkeeper posts the net to the right expense account and the VAT to the VAT account in one pass, with no back-calculation.
How to use the template
- Fill in the employee, period, and approver in the header.
- Record each cost with its net, the VAT actually charged, and the gross, reading the figures off the receipt.
- Use 0.00 in the VAT column for zero-rated and exempt costs.
- Attach or reference a receipt for every line, and confirm a VAT invoice exists for any line you reclaim VAT on.
- Total the report and submit it for approval, then to the bookkeeper for posting.
Common mistakes
- Assuming 20% on everything. Zero-rated and reduced-rate costs carry less or no VAT.
- Reclaiming without a VAT invoice. A card receipt alone does not support a reclaim.
- Recording only the gross. Without the split, the bookkeeper has to re-derive the VAT line by line.
- Mixing the report’s currency. Convert foreign-currency costs to sterling at the date of the spend.
When the report should fill itself
A spreadsheet works, but reading VAT off every receipt by hand is exactly the kind of work that should be automated. Tools that help:
- Dext extracts the net, VAT, and gross from a photographed receipt.
- ExpenseFlow reads each receipt, splits out the VAT at the rate actually charged, codes the net to the right account, and posts it into Xero or QuickBooks Online with the source image attached, so the report is built as the spend happens rather than reconstructed monthly.
- Hubdoc pulls recurring supplier invoices in with their VAT already itemised.
Use the template to start, keep the VAT split honest, and move to automatic capture as volume grows.