Rents received in the P&L ??
A property management limited company derives rents from commercial clients in two scenario's :
1) lease agreement between company and clients and between company and landlord
2) lease agreement between landlord and clients
In (2) above the company is simply collecting the rents on behalf of the landlord and paying this straight across. Sometimes a surplus is retained a surplus on rents collected but essentially the company charges the clients an admin/mgt fee for this facility.
In (1) above the company charges the clients rent receivable in excess rents payable to the landlord under there own arrangement/lease agreement. An admin/mgt fee may or may not be charged in addition but fundamentally the profit is derived from the net surplus rents received.
The question therefore is how should this be displayed in the P&L ?? I am assuming that in (2) the income is not reported in the P&L as it is technically not trading income of the company, however in the event of a net surplus can this be combined with the rents received in (1) or are they required to be reported separately in the P&L ??
Note that I am NOT netting-off the rents receivable and payable derived from (1), as this I consider to be trading income and cost of sales of the company.
A little bit complex but hopefully I have made myself clear.
Any advise greatly appreciated.
- deleting customers on Sage 50 140 7
- Fee agreed but client disagrees on amount 689 8
- VAT on garage rent 308 14
- Value-shifting 34 1
- Pattern for CTA 192 4
- Flat Rate Scheme 268 14
- Debiting private use proportion to directors loan account 429 18
- SDLT exemptions/reliefs 67 2
- Incorrect Accounts. Is it worth taking action against the old accountant? 171 3
- Film Partnership Enquiries - am I just unlucky? 217 5
- EBT 170 1
- Tax deductable portion of home rental cost 153 8
- Giving a seminar 507 28
- Joint Filing Help 95 1
- Altered PAYE cheque 187 4
- ICAEW student, Dilema with client & boss 2,202 32
- Interest on Loan to a Company 248 2
- Writing off bad debts 177 4
- Added years superannuation 50 1
- How to use importing procedure for Transfers between the bank accounts 99 2
- Desperately seeking Susan, Sam or anyone with any other name 1,200
- Experience with Islamic investor following Sharia-compliant rules? 599
- Darwinpay Partnership Assessment 404
- S464A Charge to tax: conferring benefit & BIK 307
- Bank interest in 'near' facility recall situation 191
- Agent fees to sell business 186
- Alphabet shares 184
- ACCA continuity of practice arrangement needed 176
- Quirky thread of the year: Community Awards 158
- VAT codes In Sage. Am I correct? 158