The 5 main challenges of managing college volunteer expenses

Many colleges rely on the dedication, hard work and commitment of volunteers for a whole host of tasks. These can include providing classroom support to individuals whilst learning; helping with catering; facilitating fundraising activities (such as marshalling, set-up or take-down, handing out leaflets, selling tickets) or even general help such as decorating, gardening or cleaning tasks.

In specialist settings e.g. in a medical school for example, it is also common for experienced individuals to volunteer for more complex tasks such as assessing committee applications, overseeing assessments, sitting on an advisory committee, or supporting examinations.

The potential to make great use of volunteers is vast – so it is imperative that they are quickly and accurately reimbursed for any expenses they incur.

What do volunteer work expenses include?

Although volunteers are not paid for their time, it is usual for any expenses they do incur to be covered by the college. Clearly as volunteers are giving their time and skills for free, they should not be out of pocket for doing so.

That’s why typically a college volunteer expenses policy will include reimbursement for various costs such as food, drink and travel to and from the volunteer activity.

Other ‘reasonable’ expenses might include administrative costs such as postage, phone calls or stationery; any equipment used; as well as the cost of protective clothing if this is required for specific tasks. Some volunteers may also need to claim for childcare or elderly dependants care expenses whilst they are volunteering.

Why is tracking college volunteer expenses necessary?

There are a couple of fundamental reasons why it is important to accurately track volunteer expenses. Firstly (and most obviously) when you’re paying money out of your college budget, you need to keep track of exactly what is going to whom and why.

Secondly, you should also have a process in place that ensures that expenses claimed and paid are always in line with your volunteer expenses policy. This should include caps on the amounts paid for example £5 per person per day for subsistence or a maximum level for travel costs.

What are the 5 key challenges in managing college volunteer expenses?

1. Bureaucracy and outdated processes

When did you last review your volunteer expenses policy and processes? If this hasn’t been done recently, you may well find that there are much easier and less time-consuming ways to manage everything.

Obviously, your volunteers should be asked to provide their receipts, travel tickets or similar evidence for expenses claims. But in terms of processing these, it can save a lot of time and effort - and help to avoid potential mistakes - if you introduce digital functionality such as scanning receipts, offering online forms, and setting up automated alerts and approvals. You will need an up-to-date finance and expenses system to do this.

2. Compliance with tax regulations

Suppose you only pay or reimburse the actual expenses that a volunteer has incurred and do so at a reasonable level. In that case, you do not have to deal with income tax or National Insurance Contributions (NIC). You will not have to deduct income tax or NIC under Pay As You Earn (PAYE) and you will not have to report the payments to HMRC.

Conversely, if you make payments that are more than out-of-pocket expenses, this will be treated as taxable income, and therefore income tax and National Insurance regulations will apply. These rules apply even if you describe payments as ‘pocket money’, ‘sessional payments’ or a ‘stipend’. Beware too that such payments may have implications for the legal status of your volunteers.

If you make a gift in kind to a volunteer (who is not an office holder or employee) as a 'thank you', you should not have to deal with income tax or NIC. This is the case provided that the cost is reasonable in relation to your organisation's total income and the volunteer's contribution.

3. Expense tracking and reimbursement

You must be able to demonstrate that your college is not paying volunteers a taxable income. You should also track volunteer expenses carefully to remain compliant with the law and ensure your college always has an up-to-date picture of what is being paid and what is likely to be claimed going forwards.

4. Differentiating paid staff and volunteer expenses

It is likely that the staff on your payroll may be eligible to claim for a wider range of expenses compared to your volunteers, which is why most colleges find it helpful to have an expenses claim form specifically for their volunteers to reflect these differences. That alone is reason enough to have entirely separate policies, processes and paperwork so that these separate payments don’t get mixed up once they enter your system.

5. Board and stakeholder reporting

With a robust finance software package in place that enables you to separate employee expenses from volunteer expenses, reporting on these two distinct categories also becomes a lot easier and more transparent.

How can your college better manage volunteer expenses?

Why not take time to review and improve how your college manages its volunteer expenses? With a modern finance system such as Access Expense in place, you will be able to make full use of the built-in tools and functionality available to further tighten up your volunteer expenses approach. Below are three ways that this can be accomplished quickly and easily – and ensure that everything is clear for your volunteers and for your Finance team.

• Have a clear volunteer expenses policy - This should detail exactly what expenses are claimable, outline exactly how to make a claim, what limits are in place on amounts per day, per item, etc., and what evidence needs to be provided.

• Set up pre-approved expense budgets - At an organisational level, it will help you to keep control of your expenses outlay if you specify a budget for volunteer expenses and monitor claim levels against it over time.

• Track volunteer expenses digitally - Introducing digital expenses processing for your volunteers not only makes life easier for them, it also means that you can collect and review data in real-time. It’s much more accurate too, which helps to ensure that your policies and thresholds are being adhered to.