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Double entry tenant deposits

Posted by Tax1 PM | on Thu, 09/02/2012 - 19:11  683  12 comments | report

Hi everyone,

Can someone tell me what the double entry is when accounting for tenant deposits please?

Thanks

Comments

is it....

pauld | Thu, 09/02/2012 - 19:21 | Permalink

Dr Bank

Cr Creditors

DPS and agent

Tax1 | Thu, 09/02/2012 - 19:33 | Permalink

Agreed.  What about the DPS and agent?

should_be_working's picture

Because all landlords are evil, don't you know ...    1 thanks

should_be_working | Thu, 09/02/2012 - 20:23 | Permalink

Given the hassles some of my landlord clients have had getting the deposit out of the DPS, I'd be inclined to ignore it until they successfully claim it. Treat it like insurance claim proceeds.

2 legs    1 thanks

Fred Smith | Thu, 09/02/2012 - 23:16 | Permalink

Dr Bank 

Cr Tenant deposit

 

Cr Bank

Dr DPS receivable

Thanks

Tax1 | Thu, 09/02/2012 - 23:27 | Permalink

Thanks Fred. 

Deposit

Tax1 | Thu, 09/02/2012 - 23:30 | Permalink

Please could someone tell me what the double entry would be if a rental agent collects the tenant deposit and if there are repairs on departure?

Thanks

Tax1 | Thu, 09/02/2012 - 23:32 | Permalink

Thanks should_be_working.

repairs

Fred Smith | Thu, 09/02/2012 - 23:38 | Permalink

ie tenant pays a 500 deposit but repairs are assessed at 150 on departure:

 

Cr Bank                350   

Dr Tenant deposit  350

Monies to exiting tenant

Dr Tenant deposit 150

Cr Bank                150

Monies to landlord to pay for repairs

 

I thought you were legally    1 thanks

bernard michael | Fri, 10/02/2012 - 09:04 | Permalink

I thought you were legally bound to use DPS, with heavy penalties if you don't (one for David????)

Yes that's exactly what I was

Tax1 | Fri, 10/02/2012 - 19:06 | Permalink

Yes that's exactly what I was thinking Bernard.

 

 

Deposits property investment limited companies

Tax1 | Fri, 10/02/2012 - 19:39 | Permalink

I am preparing financial statements for property investment limited companies.  The rental agent collects the gross rent (sometimes deposit?) and deducts a management fee and repairs and maintenance on departure.

 

 

DPS

Fred Smith | Sat, 11/02/2012 - 22:32 | Permalink

Agreed that not using DPS is illegal and subject to fine.  The double entry above is correct but missing one further leg being the monies moving from the DPS to the agent ie Cr DPS receivable 500, Dr Bank 500.

 

I am not sure of the process that an agent must follow in order to retain deposits due to damages, presumably a file of valid expenses must equal the amount deducted from the deposit.