Clause Guide
Expense Reimbursement Clause clause: meaning, risks, and what to negotiate
Explains when one party can charge the other for expenses incurred while performing the contract.
What it means
This clause controls whether travel, software, materials, or other out-of-pocket costs are reimbursed.
Common risks
3 risks identifiedReimbursable expenses may be too broad.
There may be no approval requirement.
Unexpected costs can increase the overall deal value.
What to check before signing
ChecklistWhich expenses are reimbursable?
Is prior written approval required?
Are there caps or documentation requirements?
Negotiation ideas
ActionableRequire pre-approval for non-routine expenses.
Set cost caps.
Require receipts and supporting detail.
Example clause
Client shall reimburse Contractor for pre-approved reasonable out-of-pocket expenses supported by receipts.
Frequently asked questions
1 questionsWhy does an expense reimbursement clause matter?
It controls whether additional costs can be passed on beyond the contract price.
Want help reviewing the full contract?
A single clause rarely tells the whole story. Scan the full agreement to spot risks, missing protections, and negotiation points across the whole document.