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Post Info TOPIC: Tenant and Landlord Transactions
Jassie


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Tenant and Landlord Transactions
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Hello all,

I'm preparing an account for a letting agent using Sage and I don't really understand how to post Rent received from tenant and Rent payment to Landlord. My clients are acting as agent for Landlord so they collect rent from tenants, deduct their commission and disbursement and pay the balance to Landlord.

I tried using sales N/C (4000 etc) in Sage for rent receive, but this has affected the P&L account so I have deleted the transactions.

I don't have problem posting commissions received from Landlord by my client.

My only problem is how to process rent receive from tenant and payment to Landlord. Which Nominal Code would you use for this transaction please?

Can anyone please help!

Many thanks
Jassie

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ethem


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Hi Jassie,

I would classify the rent collected as money in trust therefore it would be posted into a control account net of commission with commission going to 4902 and the rent as both a liability and asset

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ADAS


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I'd do it slightly different to ethem, in that I'd post gross rents to the control account. I personally don't like net postings.

1. Rent collected

dr Bank
cr Rent control (liability in b.sheet)

2. Commission earned

dr Rent control
cr commission income

3. Pay landlord net

dr Rent control
cr bank.



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Tony

Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
.
Jassie


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Hi Ethem and Adas,

Thanks for your suggestion I will try it and let you know how I get on.

Many thanks for your help.
Jassie

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BackOfficeGroup


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I would follow the Tony procedure.

Can I add one thing, get the client to have a client bank account and not juts use the one account for all. This can be a dangerous area and having the 2 accounts makes life easier when reconciling.

P

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Jassie


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Hi P,

Thank for adding your comment - the client have a client bank account as well.

Many thanks
Jassie

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