Expense Management | Policy Engine

Policy enforced at submission, not at approval.

Per-category, per-employee-level, per-trip-purpose limits enforced on the expense form. Over-limit needs justification plus a higher-tier approver. Section 10(14) per-diem rules built in. The AP team reviews compliant expenses; the policy stops the rest.

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How it works

From rule to enforcement, before approval.

Step 01

Policy rules configured

Per-category limits (food ₹500/meal for L1, ₹1,000 for L4), per-trip-purpose limits (training has no liquor), per-city limits (metro vs non-metro per-diems).

Step 02

Submission gate

The employee fills the expense; the policy engine checks. Over-limit highlights inline with the rule cited. The submit button stays disabled until either within-limit or override-with-justification.

Step 03

Override routes higher

Justified overrides route to a higher-tier approver. The CFO sees over-limit approvals on a daily dashboard with the justification chain.

Step 04

Section 10(14) tax adjustment

Per-diem above the Section 10(14) prescribed rate is taxable in the employee's hands. The system computes the tax adjustment automatically and posts it to payroll.

What the system does

Capability, input, output.

Capability	Input	Output
Per-category limits	Category + employee level + amount	Submission gate at limit
Per-trip-purpose rules	Trip type + allowed categories	Disallowed categories blocked at submission
Per-city limits	City + per-diem rate	Metro vs non-metro per-diem applied
Override workflow	Justification + approver chain	Routed to higher approver
Section 10(14) compute	Per-diem actual vs prescribed	Tax adjustment to payroll

Per-category limits

Input

Category + employee level + amount

Output

Submission gate at limit
Per-trip-purpose rules

Input

Trip type + allowed categories

Output

Disallowed categories blocked at submission
Per-city limits

Input

City + per-diem rate

Output

Metro vs non-metro per-diem applied
Override workflow

Input

Justification + approver chain

Output

Routed to higher approver
Section 10(14) compute

Input

Per-diem actual vs prescribed

Output

Tax adjustment to payroll

Compliance + integrations

Policy and tax law, both enforced.

Section 10(14) of the Income Tax Act prescribes per-diem rates for tax-free reimbursement. The policy engine enforces both the company policy and the Section 10(14) rule in one pass. Excess auto-flagged for tax adjustment.

Regulations we work within

Section 10(14), Income Tax Act

Per-diem prescribed rate enforced; excess flagged for tax.
Rule 2BB, Income Tax Rules

Categories of allowance prescribed for Section 10(14) treatment.
Section 17(2), Income Tax Act

Perquisite valuation where company-funded benefits exceed limits.

Connects to

Payroll module Tax adjustment posting

Policy Engine FAQ

What buyers ask.

Section 10(14) per-diem. What rate is prescribed?

Rule 2BB prescribes the rate for various allowances. For travel within India, the standard rate is ₹1,500 per day; international travel rates are city-specific. Above the prescribed rate, the excess is taxable in the employee's hands. The system carries the latest rates and adjusts when CBDT updates them.

Can we have different limits for different employee grades?

Yes. Per-category limits configured by employee level (Junior, Senior, Manager, Director, C-suite). The system applies the right limit based on the employee's level at the time of expense.

A genuine emergency over-limit. How is it handled?

The override workflow allows submission with justification and routes to a higher-tier approver. Emergency overrides are logged separately for the CFO's monthly review. Repeat overrides for the same employee or category trigger a policy review.

Related features

Configure your top 5 limits. Run last quarter's expenses through.

Free trial, one entity. Configure your top 5 expense limits in 5 minutes. Run last quarter's submitted expenses through the engine. The over-limit and the tax-adjustment exposure surface in minutes.