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Create and Manage Expenses Entries

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Expense entries in Clio Manage allow you to track costs related to matters, such as barrister fees, court filing fees, and expert witness costs. By default, all expenses are recorded as standard expenses without categorisation. If your firm needs to differentiate between expenses paid to third parties (disbursements and anticipated disbursements) and internal costs billed to clients (expense recoveries), you can enable these options in Settings.

Enable expense tracking for hard costs (disbursements) and soft costs (expense recoveries)

By default, Clio Manage tracks all expenses as standard expenses. You can enable tracking expenses as disbursements vs expense recoveries to categorise reimbursable expenses, anticipated disbursements before they are paid, or expense recoveries. If your firm needs to track vendor payments against recorded expenses, you can link bank transactions to standard expenses. This ensures that payments made from your operating account to third-party vendors are correctly recorded and appear in financial reports.

Enable recording expenses as disbursements

Note: Previously recorded expenses will not be affected when this feature is enabled.
Important: Disabling this feature will revert disbursements to standard expenses. Re-enabling it will restore their categorisation as disbursements.
  1. Go to Settings > Billing > Expenses subtab.
  2. Toggle on Record expenses as disbursements.

 

Enable linking disbursements to bank transactions

With this feature, you can link standard and anticipated disbursements to bank transactions. If your firm is located in Ireland or the UK, this feature is automatically turned on. Otherwise, if your firm is required to link transactions and disbursements for compliance reasons, you can turn this feature on by following the steps below.

  1. Go to Settings > Billing > Expenses subtab.

  2. Toggle on Link disbursements to bank transactions.

    Note: To toggle Link disbursements to bank transactions, you will first need to toggle Record expenses as disbursements to on.

 

Enable recording anticipated disbursements

Once disbursements and expense recoveries are enabled, you can use this feature to record, manage, and report on vendor expense estimates before receiving payments. If you disable this feature, previous entries recorded as anticipated disbursements will revert to standard disbursements.

Important: Anticipated disbursements must be linked to a bank transaction after recording.
  1. Go to Settings > Billing > Expenses subtab.

  2. Toggle Record anticipated disbursements.

    Note: To toggle Record anticipated disbursements, you will first need to toggle Record expenses as disbursements and Link disbursements to bank transactions to on.

 

Enable recording taxes on disbursements

When your firm pays a vendor for a disbursement, the tax paid on the vendor bill (input tax) may differ from the tax charged to the client (output tax). You can track the tax paid on vendor bills separately from the tax applied on client invoices, which supports accurate reporting and compliance.

If you record taxes on disbursements, you can configure your account to read the amount as tax inclusive or tax exclusive, so you can enter the amount as it appears on the vendor bill. The net amount and input tax are then calculated and used wherever a vendor payment is recorded, such as bank linking, the matter ledger, and Xero.

  1. Go to Settings > Billing > General.
  2. Toggle on Enable recording of input and output taxes on disbursements.

 

Add new expense entries

Expenses track costs related to a matter in Clio Manage. Record these costs and attach receipts to facilitate firm reimbursement and provide clients with clear bill transparency. You can create expense entries from several areas in Clio Manage, including the main Activities page, a matter’s Activities subtab, or the global Create new button.

Note: When recording expense recoveries, you can enter up to four decimal places. Other areas in Clio may round values to two decimal places, but the actual rate remains unchanged. Quick bills support two decimal places.
  1. In Activities, click New expense.
    • Alternatively, from the global Create new button, select Expense entry.
  2. If you previously enabled tracking expenses as disbursements vs expense recoveries, select the expense type and complete the required fields.
  3. Optional: Under Receipt, select Attach receipt to select a file already in Clio or click Upload receipt to upload new files from your computer (up to a maximum file size of 15 MB). Once you have selected all relevant files, click Attach.
    • To include attached receipts on client bills, check the box for Send receipt with bill. Receipts attached to non-billable expenses will not be sent with the bill.

  4. Optional: Under Expense category, select a pre-created category to auto-populate certain fields. If the matter has LEDES billing enabled, select the relevant code under UTBMS Expense code. For the Tax field, choose one of your pre-created tax rates. If your firm records taxes on disbursements, the category can also pre-fill GST on purchase, GST on client invoice, and whether the amount includes GST.

    Note: The rate(s) added here are used as the default tax rates, but you can still edit them at the time you generate a bill.
  5. If your firm uses multiple currencies and the expense currency is different from the matter’s currency, you may have to select the conversion rate to use (if you chose Billing Settings where the rate is set at the time you record the expense).
  6. Complete the remaining fields.
    • When entering the date, you can select a past, current, or future date.

    • You can mark an expense as non-billable by checking the Non-billable box. If you still want the non-billable expense to appear on bills, check the Show this entry on the bill box.

      Note: Tracking non-billable expenses helps the firm track non-billable activities and report on non-billable time using the Matter productivity by user  report. Showing these entries on bills demonstrates the extra value invested in a client's matter.
      Important: Non-billable expenses marked as Show on bill will only appear on bills generated using bulk billing (Billing > New bills). They will not appear on invoices generated using Quick bill.
    • Optional: Select a tax rate or rates to apply to the expense. You have to create the tax rate first in order to select it from the dropdown when you create an expense entry.
      • When selecting multiple rates you can apply subsequent taxes to the pre- or post-tax amount.
      • If your firm records input and output taxes on disbursements, complete the steps under Record taxes on disbursements instead.
  7. Save the entry.
    • Click Save entry to save and exit the modal.
    • Click Save and > Create another to save the entry and clear the fields in the modal to create another entry.
    • Click Save and > Duplicate to save the entry and keep the fields filled to create additional similar entries.

 

Record taxes on disbursements

When your firm records taxes on disbursements, the expense form asks whether the amount includes GST. The entry saves the net amount and the GST on purchase separately. For example, an amount of $110 including GST and an amount of $100 excluding GST at 10% both save as $100 net with $10 GST on purchase. When you reopen the entry, it shows the amount and the option you selected.

Note: Tax field names use the tax name your firm set up in Configure Tax Settings, and the amount field uses your firm's currency. This section uses a tax named GST and amounts in AUD, so the fields read Purchase amount in AUD, Inc GST, GST on purchase, and GST on client invoice.

  1. In Purchase amount in AUD, enter the amount from the vendor bill.
  2. From the menu next to the amount, select whether the amount includes GST.
    • Select Inc GST if you entered the total paid to the vendor, for example $110 on a vendor bill of $100 + $10 GST.
    • Select the option that excludes GST if you entered the amount before GST, for example $100.
  3. Under GST on purchase, select the rate charged on the vendor bill.
  4. Under GST on client invoice, select the rate billed to the client.
    • This rate can differ from GST on purchase, for example when the vendor charges no GST but the client bill includes GST.

Note: Clients are billed on the net amount, with the GST on client invoice rate, or the tax chosen when the bill is generated, added on top. GST on purchase is not billed to the client. It is added to the net amount wherever the payment to the vendor is recorded.

Tip: Recording the net amount and the GST on purchase separately keeps the client bill and the vendor record consistent, so clients are billed only the tax that applies to them.

 

Understand net and amount-paid values

When your firm records taxes on disbursements, each disbursement has a net amount and an input tax amount. Anything billed to the client uses the net amount. Anything that records the payment to the vendor uses the net amount plus input tax, which is the amount paid.

For example, a $100 search fee with $10 GST on the vendor bill and 10% GST billed to the client:

Area Amount used Example
Client bills Net amount, plus client tax $100 + $10 = $110
Bank linking and vendor payments Net amount plus input tax A $110 bank payment settles the disbursement
Matter ledger Net amount plus input tax $110 operating money out
Disbursement listing and disbursement payment reports Separate net, input tax, and tax-inclusive columns $100, $10, $110
Anticipated disbursement payment email Net amount, input tax, and total paid $100, $10, $110
Balance summary, budget, work in progress (WIP), and revenue reports Net amount $100
  • The input tax is calculated once and rounded to the nearest cent, so the net amount plus input tax always equals the total entered.
  • Editing the price later, for example on a bill line, recalculates the input tax from the new net amount.
  • If a currency conversion applies when the expense is recorded, the input tax converts along with the amount.

Tip: To review input tax by disbursement, use the disbursement listing report in Clio Manage Client Reports.

 

Track vendor bill status

If your firm uses the Xero integration with the Sync to Xero as bills to pay setting enabled, you can monitor the real-time synchronisation status of your Disbursements and Anticipated disbursements.

Tip: Monitoring the Vendor bill status helps you track third-party liabilities directly on the matter. This ensures all firm-paid expenses are accounted for before you finalise a client bill, protecting your firm's profitability.

  1. Go to the main Activities tab or the Activities subtab within a specific matter.
  2. Locate the Disbursement or Anticipated disbursement entry.
  3. View the Vendor bill status field:
    • Unpaid: The expense has synced to Xero as a bill to pay but has not been settled.
    • Paid: The expense is settled in Xero or linked to a bank transaction in Clio.

Note: Xero does not allow edits to paid bills. Once an expense is marked as Paid, the entry in Clio Manage becomes read-only and cannot be edited or changed back to Unpaid.

 

Duplicate and edit expenses

You can edit and duplicate an expense activity from the main Activities page in Clio Manage or from the Activities subtab within a matter. 

Duplicate expenses Edit expenses
  1. Go to Activities and find the expense you want to duplicate.
  2. In the Actions column, click Duplicate, or select Duplicate from the dropdown.
  3. Make any necessary changes.
  4. Click Save entry.

Note: Disbursements recorded with GST on purchase before the Inc GST option was available have no option selected, and their amount is treated as excluding GST. When you edit one of these entries, select whether the amount includes GST before you save.

Important: After a disbursement is linked to a bank transaction, the choice of whether the amount includes GST is locked.

 

Delete and recover expenses

You can delete an unbilled expense from the main Activities page in Clio Manage or from the Activities subtab within a matter and administrators can recover expenses from the Recovery Bin. You can also track deleted expenses in the Recovery Bin, a matter timeline, and from the Firm Feed in your dashboard.

Important: Deleted expenses remain in the Recovery Bin for six months and can usually be restored, but Clio does not guarantee data recovery. Users can delete individual expenses and  administrators can delete multiple expenses at the same time.
Delete a single expense Delete multiple expenses Recover expenses
  1. Go to Activities.
  2. In the Actions column, click Delete or select Delete from the dropdown. You can also check the box next to the expense you want to delete, then click Delete above the table header.
  3. When the warning prompt appears, select Delete entry.

 

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