Paying expenses to employees

[Kett]

Can anyone explain to me how to pay expenses to employees? (with their wage and expenses coming to less than £8500 per year)

Basically, they have paid for items using their own money, and I want to reimburse them. I'm not quite sure how to go about this in terms of paperwork. I've tried reaching some HMRC information but can't work out what to do.

There are two employees concerned. One is just an employee and the other is also a director (both under £8500), both on PAYE scheme.

Thanks :)

[Kett]

I should probably mention - the employee who is not a director pays 20% PAYE tax (as it is his second job). Mainly what I'm wondering is what payments/forms need to be made to the HMRC?

[sanjiv]

I would have thought that you would just simply make them a cheque payment. It would not go through PAYE because that money they have spent has already been taxed so taxing it twice would mean they don't get the full amount.

[Scalloway]

Make sure you get the receipts or the payments become taxable.