14 Aug /17

Reimbursement

Reimbursement – Word of the day - EVS Translations
Reimbursement – Word of the day – EVS Translations

The word reimbursement entered the English language circa 1520s, formed by a derivation from the Middle French embourser (em ‘in’ plus borser ‘to get money’), where the root borse derives from the Medieval Latin bursa ‘money bag, leather purse’ and the meaning first recorded in the 1570s, whereas the noun bourse to mean ‘a place of meeting for merchants, a stock exchange’, appears circa three centuries later.

The first English source, to use the term reimbursement, is the Records of the Convention of the Royal Burghs of Scotland from 1591, followed by the first edition of The history of Great Britain under the conquests of the Romans, Saxons, Danes and Normans from 1611, where John Speed records that: “The King had restored Brest in Britaine to the Duke, upon reimbursement of the money lent,” referring to the sums of money Kind Richard has been receiving during his reign from his cousin the Duke of Britaine as a repayment for the loans taken from the ancestors of King Richard, as the Kind himself reaffirmed: “The truth it is that our cousin the Duke of Britaine had satisfied all such sums of money as our progenitors lent into him, and to his ancestors upon gage of the town of Brest, for the which reason and conscience will no less but that the town should be thereupon be to him restored.”

The reimbursement of royal debts continued in the 1662 John Davies’ translations of Adam Olearius’ The voyages & travels of the ambassadors sent by Frederick Duke of Holstein, to the great Duke of Muscovy, and the King of Persia and the term kept its strict meaning to describe the act of paying back or covering expenses.

The first insurance companies starting to provide private health care coverage in the 1850, paved the way for health care reimbursements and in the following century, to the introduction of plans where employers reimburse employees’ medical expenses and the amounts received – excluded from employees’ income. Employees’ reimbursements developed further to cover different business expenses (travel expenses, day care, education, special clothing, supplies, tools or equipment, etc) that occur solely by reason of action taken for the convenience of the employer.

A valid business expense, eligible to reimbursement, is one that an organisation may deduct on its income tax returns and one that is treated as untaxed income for the employee, provided that accountability conditions are met.

Naturally, reimbursement payments may be taxable depending on applicable laws and as an reimbursement might occur in many contexts, it is governed by federal, state, and local laws, as well as contract law. Additionally, governments may reimburse taxpayers as well in the form of tax refunds, such as reimbursements for Value-added tax or low income.