Categories for recording

Accounting
1

what category would you put something under for the following:

If paid a supplier for ‘rental commission’ for rental of property, what would this go under? is it a professional fee or something else??

2

There’s a category for “Rent” (7100), I would recommend using this one.

Sorry I misread your question and assumed the payment was actually for rent. If you’re paying commission then instead use “Sales Commissions” (6100).

3

not sure though?
we use a property management service, so the invoice would say for example

rent collected £400
rental commission £40
VAT@ 20% £8.00
credited to account £352.00

So Im assuming that the rent collected (£400) - would go under as 'rental income’
the rental commission and vat (£48.00) would go as a purchase - this bit is what I am not sure what category i should be choosing, as Im not sure that ‘rent’ is the correct bit as you describe??
(we are not vat registered)

4

You may find the following posting useful:

http://www.qfaccounting.co.uk/detail.aspx?id=4029344

So basically, using the above example:

  1. you would pay the rent to the new rental holding bank account created in step 2 of the above example.

  2. Log the rental commission paid i.e. £48.00 as gross (I assume the property has not been elected for VAT) as an expense, you can either use the nominal code ‘Sales Commissions’ or add a new nominal code called ‘Letting Agent’s Fees’. Pay the commission from the same holding account that the rent was paid to. The balance on the rent holding account should now be £352.00 (£400 rent paid in, less: £48 rental commission paid).

  3. Finally, tag the payment received from the agent of £352.00 into your bank account, as a transfer from the holding account. The balance on the rent holding account should now be £0.00, any balance on this account will be rental monies still owed to you by the agent.

5

I am not sure on how to open a Quick file bank account as stated in step 2 of your example. I have gone to the ‘banking section’, ‘create new account’, but am stumped after this bit, as there is a mandatory field for account number and sort code? kinda got lost in this bit, or am i in the wrong section?

6

You’re doing it correct. The sort code and account number field aren’t mandatory and can be ignored.