Company payments on personal credit card - risks?

[KiloRomeo]

So I work in engineering and occasionally company expenses come up and it's just more practical to make payment with my personal credit card and submit an expense report. This is usually vendor fees for $20-$400..no big deal.

The other day a $15,000 payment came across my desk which you could pay with credit card. It would actually be pretty convenient to pay this with a credit card as it would be reflected in our account immediately rather than take a few days when we process a check/ACH. My manager jokingly asked why I didn't put this one on my credit card and he was surprised when I said I will definitely consider it next quarter.

Assuming there are no additional fees on the company side, are their any legislative/tax/legal/accounting issues with this for the company? I wouldn't mind doing some travel hacking with this but I don't want to create any issues for the company. The biggest risk I can think of is it being a talking point among employees and cause issues that way. Any thoughts?

[CatamaranSailor]

I don't know about legal/accounting issues...(I don't think there would be because companies do this all the time) but I would be wary.

My first job out of college was a travel job and the company I worked for required us to use Amex. Fine, no problem. The problem (I didn't realize at the time or I wouldn't have gone along) was that it didn't matter if the charges were all company related, the responsibility and liability was 100% on the employee. The company would cut a check to the employee (who would then pay the Amex bill). When I left, I cut up the Amex card and verified that I had a zero balance.

Fast forward a year...the company suddenly goes out of business and several of my friends who still worked there were shocked when Amex told them it didn't matter that the company had gone bankrupt...they still owed the $$. Some of these guys would rack up $10,000 in a month due to all of the traveling. Not fun...

I think I understand what you want to do (pay the $15,000 on your card, get the rewards/points then use the company reimbursement to pay it off...correct?)

I would want to make sure the company has the ability to pay, would pay in a timely manner, don't have an internal policy somewhere against this (that is suddenly "discovered" AFTER you've paid), etc, etc.

Personally, I wouldn't. But I am extremely conservative.

[Northwestie]

For $15k I'd be pretty careful.  Typical travel expenses I don't see a problem, unless they are slow to pay then it would be worth asking for some advance.  You shouldn't have to carry a balance nor float them.

[BigHaus89]

It depends on the company and how stable they are financially. If you have a high enough credit limit and the company is in good financial standing, I don't see why you shouldn't reap some CC rewards for little risk.

[NoStacheOhio]

The other thing to watch out for is if you need any additional sign-off at that level. For my company, a $15,000 expense would need sign-off from pretty high up the food chain.

[JZinCO]

I always do this. Some times I would float 5-10K on a card and then submit reimbursement at the end of the quarter. Apparently, the IRS says this is no longer alright. And submissions for reimbursement should occur in <60 days from the charge incurred. If 60 days have surpassed the IRS will tax the reimbursement.

[Prairie Stash]

I use to do it until they issued a company card to me. It was pretty awesome racking up the points, typically I get 1% back in points, I was spending $20K annually. My company found the hassle of cutting checks to be larger than reimbursing CC, they actually saved money/time. For a check typically you submit a form that goes to an accountant. That person then scrutinizes the bill, which you originally did before sending it over, and then mails a check. If you walk through the process of cutting a check its pretty inefficient which is why few of us do it in our personal lives.

In Canada if I receive airline or hotel points there was no tax implications. If I receive cash back then it was considered taxable, although its unlikely anyone actually gets caught. At the time I found an online form explaining it, basically any time cash enters your hands though its taxable, although you still end up ahead.

Try not to make a big deal of it at work, don't hide it but don't go out of your way to discuss.

[brooklynmoney]

I would leap at the chance to do this. I charge all of my office's expenses on my Amex so I can get the spend requirement waived for the Delta miles program and I can make gold or platinum. I beg coworkers to let me charge their travel. .

[Goldielocks]

I use to do it until they issued a company card to me. It was pretty awesome racking up the points, typically I get 1% back in points, I was spending $20K annually. My company found the hassle of cutting checks to be larger than reimbursing CC, they actually saved money/time. For a check typically you submit a form that goes to an accountant. That person then scrutinizes the bill, which you originally did before sending it over, and then mails a check. If you walk through the process of cutting a check its pretty inefficient which is why few of us do it in our personal lives.

In Canada if I receive airline or hotel points there was no tax implications. If I receive cash back then it was considered taxable, although its unlikely anyone actually gets caught. At the time I found an online form explaining it, basically any time cash enters your hands though its taxable, although you still end up ahead.

Try not to make a big deal of it at work, don't hide it but don't go out of your way to discuss.

You are supposed to self claim the travel earned with the bonus points as a taxable benefit in the year you redeem it, techically....

[Goldielocks]

Risk -- is that it gets hung up waiting for approvals.   I had an employee put a staff fridge on his card, and then wait over 6 months to get it paid out....


The other risk is that your card impacts your credit limits / borrowing...  company card does not.