[GNC] GnuCash for a Letting Agency (holding client money)

[zcacogp]

Adrien, 

Thanks for your detailed reply - I'm very grateful that you are engaging
with the questions! 

I'll confess that I don't fully understand your answer but am learning more
as I look at this matter more and more. Re-reading helps. 

The properties are not mine - I let and manage them on behalf of the owners.
And yes, the landlords are my clients - not the tenants. Therefore in that
example I cited with the rent of £1000 then the flow is thus; 

- Tenant pays me £1000
- I invoice the landlord £100
- I pay £900 on to the landlord and keep £100, effectively paying the
invoice

The £100 is company income but the £900 isn't; at no stage is it my money as
it belongs to either the tenant or the landlord. (There is an argument to
say that the money belongs to the tenant if they pay early, and it then
belongs to the landlord at the moment the rent becomes due. However most
tenants usually pay slightly late so this argument is moot!) Your comment
about needing to think carefully how to treat this money is the nub of the
issue; what is the best way of doing this? 

I don't put rent owing on an invoice to a landlord; I currently keep a
separate excel spreadsheet for each property which shows all transactions
for that property but on an invoice to a landlord I only list the items to
be paid. These items are agency fees, handling fees for work commissioned
and re-charges for bills I have paid on the landlord's behalf. 

There are two other potential sticking points, although I don't think they
are biggies; 

- Occasionally I do one-off projects for people who are not landlords. This
leads to a regular invoice being raised and the client paying me the amount
owed. This is different from the 'usual' situation as there is no rent to
consider, just an invoice being raised and then being paid. 

- I bill tenants for things, so they may be clients as well as tenants.
Examples of this are when a tenant locks themselves out and I visit them to
let them in. I would bill them for this and they would pay. They will often
pay with their next rent payment. This could look like this: 

- Tenant locks themselves out. I let them in and charge £80
- I invoice the tenant £80. This is not paid immediately 
- Next month the tenant pays rent, plus £80, total £1080
- I invoice the landlord £100
- I pay the landlord £900
- I take payment for the invoices of £80 for the tenant and £100 for the
landlord from the £1080 payment 

What is a CPA? 

Thanks again for your help. I expect I'll update this thread with a number
of questions in due course. 


Oli. 




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