In this scenario you instruct an agent to collect the rent and deduct commission on remittance to you. Arthur needs to connect the rent collected to the commission charged for that month and allocate them to one another so that monies received tie up. ** For Xero users the final charge due from the tenant (care of the agency) will match monies received.
“Please note: Arthur manages commissions in two different ways. The first is when a head agent deducts commission at source and sends you the rent less their commission. This scenario is covered here and uses the ‘Head Agent Commission’ code. The second scenario is when an agent sends you a bill for commission. Under this scenario the commission is dealt with as a disbursement analysed to the ‘Letting Commission Charge’ code and is paid by the Property Owner. It is entered as a transaction using the ‘Add transaction’ function.”
In this example the is tenant paying £1500.00 pcm with an agency fee of 8% of rent received.
The set up is slightly different in two scenarios of when you first enter the tenancy:
Do NOT use the set up screen, USE the recurring screen so that you can have it switched off. The reason to have the recurring switched off is that you need to have the connected commission set up before Arthur lays in the first rent charge. Have the next collection date as the start date so that Arthur can lay in all previous rents which will have the connected commission transaction allocated against.
Then go into the Recurring Charge>Transactions>Add Recurring Connected Transaction
Fill in the details, select Paid to/by “Tenant” and Save.
Once you have created the connected transactions you are now ready to set your recurring rent charge to active. Arthur will now lay in the rent and have that connected to the transaction “Head agent commission”. Now select Edit and switch the recurring transaction to On.
Next go to the tenancy statement in Tenancy>Statement>Tenancy Rent Statement
Here you don’t need to worry about setting the recurring to inactive as Arthur has not yet created the charge, giving you the opportunity to set up the connected transaction as above.
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