How to properly account for meal expense invoices
Release time:
2025-07-17
How to properly account for meal expense invoices
During internal financial audits, we found that many branch accounting personnel have many misunderstandings in accounting for meal expense invoices. Arbitrary selection of accounting subjects, lack of supporting documents, and inconsistencies between invoice content and attachments have caused many problems such as accounting confusion, lax systems, and lack of internal control. A considerable number of accounting personnel, when processing accounts, list all meal expense invoices under the business entertainment expense account, even those costing tens of dollars.
According to Article 43 of the "Implementation Regulations of the People's Republic of China Enterprise Income Tax Law", Business entertainment expenses incurred by enterprises related to production and operation activities are deducted at 60% of the amount incurred, but the maximum amount shall not exceed 5‰ of the sales (operating) income of the year. Therefore, for business entertainment expenses, only 60% of the face value can be deducted before tax. Some accounting personnel, in order to evade taxes, record meal expense invoices as travel expenses or welfare expenses, but there are neither supporting materials nor specific explanations in the original vouchers. In such cases, tax audits will inevitably lead to increased tax assessments.
Based on the accounting principles of authenticity and relevance of pre-tax deductions for enterprise income tax, we can distinguish according to the actual use. Meal expense invoices obtained in different scenarios should be accounted for using different accounting subjects and tax treatments. Specific classification and processing points are as follows:
1. Business Entertainment Expenses
Scenario: Meal expenses incurred for entertaining clients, suppliers, etc., due to business needs.
Accounting Subject: "Management Expenses—Business Entertainment Expenses"
Tax Treatment:
Enterprise Income Tax: 60% of the incurred amount is deducted before tax, and it should not exceed 5‰ of the annual operating income (attachments should show the dining participants; personal consumption is not allowed).
Value-Added Tax: Input tax cannot be deducted (even with special invoices).
2. Employee Welfare Expenses
Scenario: Employee gatherings, overtime meals, holiday gatherings, canteen meals, etc.
Accounting Subject: "Payable Employee Compensation—Employee Welfare Expenses"
At the end of the period, it should be transferred to "Management Expenses—Employee Welfare Expenses".
Tax Treatment:
Enterprise Income Tax: Full deduction is allowed if it does not exceed 14% of the total salary (supporting documents are required).
Value-Added Tax: Input tax cannot be deducted (even with special invoices).
3. Meal Expenses in Travel Expenses
Scenario: Reasonable meal expenses incurred by employees during business trips (must be reimbursed together with travel expenses).
Accounting Subject: "Management Expenses—Travel Expenses"
Tax Treatment:
Enterprise Income Tax: Full deduction before tax (note the reasonableness of the meal amount, location, and number of diners).
Value-Added Tax: Deduction can be sought (with special invoices and other travel expense supporting documents).
4. Meal Expenses in Conference Expenses
Scenario: Work meals provided during company meetings (requires meeting notices, sign-in sheets, etc.).
Accounting Subject: "Management Expenses—Conference Expenses"
Tax Treatment:
Enterprise Income Tax: Full deduction before tax (supporting documents are required).
Value-Added Tax: Deduction can be sought (with special invoices, and other invoice materials for conference expenses are entered into the accounts together).
5. Meal Expenses for Trade Union Activities
Scenario: Meal expenses for employee activities, team building, etc., organized by the trade union (paid through the trade union account).
Accounting Subject: "Payable Employee Compensation—Trade Union Dues"
At the end of the period, it should be transferred to "Management Expenses—Trade Union Dues".
Tax Treatment:
Enterprise Income Tax: Full deduction is allowed for trade union dues not exceeding 2% of the total salary (materials such as employee collective activity notices, attendance sheets, and activity photos are required).
Value-Added Tax: Deduction can be sought (with special invoices and activity supporting documents).
- Meal expenses during employee training outside the city
Scenario: Work meals during employee education and training outside the city (requires training notices, course schedules, etc.).
Accounting Subject: "Payable Employee Compensation—Education Expenses"
At the end of the period, it should be transferred to "Management Expenses—Education Expenses".
Tax Treatment:
Enterprise Income Tax: Full deduction is allowed for education expenses not exceeding 8% of the total salary (supporting documents are required).
Value-Added Tax: Deduction can be sought (with special invoices, and training fees and travel expense invoices are entered into the accounts together).
The following points should be noted for the accounting treatment of these meal expenses:
1. Voucher Requirements:
- Invoices must be compliant (the header must be the full name of the company, the tax number must be correct, and the item must be "catering services" or "meal expenses").
- Complete supporting documents: Organize supporting materials according to the actual use.
2. Tax Risks:
- Avoid including personal meal expenses in company expenses (strictly distinguish between public and private expenses).
Except for business entertainment expenses, if supporting documents for other meal expenses are not provided or are incomplete, a tax adjustment will be required.
The meal amount must be reasonable in relation to its actual purpose.
In summary, the correct accounting treatment of meal expense invoices requires consideration of the purpose, supporting documents, and tax regulations to avoid tax risks caused by incorrect accounting entries or incomplete documentation. It is recommended that accounting units within the group establish clear expense reimbursement procedures, strictly review the compliance of vouchers, the reasonableness of supporting documents, the consistency of taxable services and supporting materials, and regularly review the compliance of accounting entries. (Chen Hongxing)
Recommended news
2026-03-30
On March 27, the Jiangsu Provincial Construction Industry Association held its 2025 Annual Conference and the inaugural Jiangsu Provincial Construction Industry Supply Chain Supply–Demand Matchmaking Conference at the Pullman Suzhou. On this occasion, our group was recognized as a “Benchmark Enterprise for Digital Procurement in Jiangsu’s Construction Industry.”
2026-03-30
On March 28, the “Judges Explain the Law, Experts Explain Practice” two-way empowerment and interactive exchange symposium, jointly organized by the Qidong People’s Court and the Qidong Construction Industry Association, was held in the 13th-floor conference room of the Qidong People’s Court, with representatives from the Group attending.
2026-03-23
Elderly Care Services Promoted in Enterprises: Policies Benefit the People and Warm Hearts
On the afternoon of March 19, 2026, the Group Trade Union cordially invited a specialist from a senior care service company to our organization. Drawing on the specific conditions in Nantong, the expert provided a detailed briefing on policies for building a senior care service system and various service models, enabling our employees to gain a more comprehensive understanding of local elderly care policies and related services. The session offered practical guidance on senior care services that is closely aligned with real-world needs, thereby effectively enhancing our staff’s awareness and knowledge of the local senior care landscape.
2026-03-20
On March 6, the Southern Region organized a special meeting for its regional staff to study the spirit of the company’s annual work conference. The meeting focused on how to align with the Chairman’s report, benchmark past performance against both successes and shortcomings, draw relevant lessons, and more firmly prioritize projects and project services while strengthening proactive service delivery—thereby truly demonstrating the value of the region’s functional role. During project inspections, regional personnel actively communicated and disseminated the key requirements from the meeting, providing clarifications on such matters as risk prevention in project operations and production, effective cost control, promotion of centralized procurement, and personnel assignment. They urged all project teams to embrace and support the Group’s various transformation initiatives, unite in purpose and pool their efforts, and contribute to the Group’s resilient development.
2026-03-16
Group Company Wins Multiple 2025 Safety Management Awards
On March 13, at the contractor safety conference held at Dow’s Zhangjiagang site, the Group was recognized as the “2025 Best Safety Performance Unit” for its outstanding safety management system and robust on-site execution capabilities, setting it apart from numerous other contractors. This prestigious award not only represents the client’s full endorsement of Jiangsu Qian’an’s long-standing commitment to the “safety first” principle, but also underscores the company’s exceptional ability to continuously enhance its safety management standards in collaboration with internationally renowned enterprises. In addition, Guo Ronggao, a member of the company’s workforce, was honored with the title of “2025 Best Individual in Safety Performance” for his diligent safety management, strict adherence to safety regulations, and proactive demonstration of exemplary leadership.
2026-03-10
Recently, good news came from the Shanghai market: the Group has successfully won the bid for the Roche (Shanghai) Biopharmaceutical Production Base Project (Phase I), with a contract value exceeding 120 million yuan.
Contact
Jiangsu Qi'an Construction Group Co., Ltd.
Address: No. 239, Jianshe South Road, Qidong City, Jiangsu Province.
Tel: 86-513-83314375
Fax: 86-513-83314374
Email: qa@qaqa.com.cn
Zip code: 226200
Mobile website
English
OA
Copyright © 2022 Jiangsu Qi'an Construction Group Co., Ltd.