Carrying a company credit card to use for business expenses sounds like a good idea. Instead of keeping a log of your expenses and turning it in for repayment, you simply say “charge it,” turn in your receipts, and the company pays the bill.
If they pay late or run up a huge debt, it’s not your concern. Maybe.
It all depends upon how the card was set up. According to a 2009 survey from RPMG Research Corporation, a third of the companies that use corporate cards make employees liable for payment – either individually or jointly with the company.
You’ve no doubt heard of individuals whose credit was ruined because their medical insurance failed to pay bills on time. It wasn’t their obligation, but it was their credit that took the hit. The same situation applies to company credit cards.
It doesn’t matter who is supposed to pay. If the card is in your name and the credit card issuer believes you’re the responsible party (or one of them) the late payment or default will show up on your credit report.
So pay attention. If the boss offers you a company credit card, but then asks you to fill out a form listing your Social Security number and other personal information, you’re probably accepting either individual or joint responsibility for that debt.
If you’ve been carrying a company credit card for years and don’t remember whether you filled out an application form, it’s a good idea to check. Get a copy of your free online credit report and look for that account.
If you find it, that means you’re liable for payment, and you should take steps to assure yourself that the bill is being paid on time. Your credit report will tell you if the account is or has been past due. Your own due diligence will tell you if it becomes past due in the future.
How can you keep track? By logging into the card’s website. You’ll be able to see the current due date, along with a record of payments. Then log in again on the due date, just to make sure the payment has been made. If it hasn’t, you probably should pay it yourself and seek reimbursement – because your credit scores are on the line. Of course, call your accounts payable department first. The check really might be “in the mail.”
If you find previous delinquencies, you may be able to get them removed by providing a letter from your employer verifying that under the terms of your employment, you are not the responsible party.
CreditScoreQuick.com
