I am trying quickfile to see if is appropriate for a small lettings agency.
We manage rented properties for Landlords. In simplest terms we receive rent from tenants which we forward (transfer) to Landlords after subtracting a management fees.
We have two bank accounts. Clients account and Current Account. All the rent money comes into the clients accounts.
We send Landlords a invoice/statement which looks like:
Rent received for property £100
Management Fess -£10
Total paid (to Landlord) £90
£90 is transferred to the Landlords account and £10 transferred to our current account (which is our revenue)
There was a guide posted on our old forum that explains how to manage a letting agency within QuickFile. However this was before we had project functionality, so it’s a little dated now.
I have discussed this subject with my colleague and we will produce a new guide specifically for letting agents that will leverage project reporting. The idea with projects is that it will make it easier to group tenant and landlords to a single property and simplify the reporting.
I will let you know as soon as the new guide is ready (Hopefully by tomorrow).
I am interested in your guide as I would also like to use QF for the same purpose.
As time allows I have been experimenting and with limited success - not being an accountant doesn’t help - have a plan that may work.
I however would see thing slightly differently to the OP here in that I would see the Landlord as a Supplier and the Tenant(s) as the Customer(s).
Therefore I would issue a purchase order for the property (Landlord) and an invoice to the tenant(s).
On receipt of an invoice payment (whole or part) I make a payment against the associated PO less any management fee.
The first invoice of a tenancy also has the added complication of the deposit and its associated posting to an appropriate account.
t.b.h. I am not sure that these links can be automated within QF.
To some extent this problem is mitigated as I am doing this from within my own software using the API functionality.
As an observation, not criticism, I have noted that not all QF functionality has an API function available and of those that do not all offer the full input of the data that can be entered manually from within QF.
So work in progress for me but as said I am interested on your take of what is a quite complex process.
It’s better not to view the tenant as a client. What you want to avoid is having the full rental payments attributed to sales invoices. These monies are really just collected on the behalf of your landlords and they should not touch the P&L, but instead appear as a liability on the balance sheet until they are remitted to the landlord.
In the above guide we treat the landlord as the client, as they are the ones who are being invoiced for the management fees, this part is your income and should be attributed to a sales invoice. Of course there may also be aspects of your work that also treat the tenant as a client (e.g. credit checks, admin fees etc), but you can invoice them separately for these services.
We are always keen to prioritise API development if it helps users to build their own custom workflows. Please let me know if there’s something you’d like us to cover in our API and I will do my best to get this implemented for you.
Thank you for the guide and your reply to my post.
I understand what you are suggesting and can now see that I have approached this from the wrong direction.
Actually having the Landlord as a client is quite helpful as I do need to accommodate the tax implications for those that are non-resident.
I am now going to follow the guide both manually in QF and using the API’s from my software - I will keep you informed.
I will still need to have my tenants as clients in order to account for deposits and other sundry charges that may arise.
The only issue I am wondering about is whether their rent charges and subsequent payments will (can) appear on their statements.
Your comment re API’s is very encouraging and I will be sure to let you know as a need arises.
Two items have sprung to mind following a quick read of the guide.
The ability to create a bank account.
The ability to add a TAG when creating a bank transaction.
We could add this. While I can’t make any hard and fast promises, I have asked our development team to take a look. We’ll certainly let you know if anything changes here.
What are you looking to tag the transaction to? If it’s just invoices, then it’s going to be easier to achieve this the other way around - from the invoice to the bank and create a new transaction.
I may have misunderstood here but I was thinking of Step 6 in the guide when paying the landlord his/her commission…
Once you have transferred the NET sum to the landlord from your bank account, locate the “money out” entry and tag it as a transfer to the Property Holding Account for that particular property.
Regarding tagging new bank transactions, this is a little more complex. I would suggest a slightly different approach here and instead to create the bank movement using the Journal API Method. This will ensure it’s effectively tagged in one single operation.