Hello,
I recently rented a commercial property and I paid a deposit to the landlord. I’m not sure how to account for this and all the other community topics are about how to account for deposit payments received rather than paid. I don’t want to simply put it into my rent account as it will show on my P&L.
Many thanks for the help in advance!
Hello @Karen_MacDonald
If the money came out of your business account you could record the payment (£1000 in the example).
Tag it as “Something else not on this list” create/select an asset code e.g. Commercial Property Deposit (in the assets range 0000-1199).
This would give you an asset of £1000(as per example) for the duration of the rental.
If you get the money back at the end you just do the reverse (refund £1000 as per example).
Example
You pay the landlord £1000 as a security deposit as required by the lease for the apartment you are renting.
If you cause no damage, you have a right to the £1000 at the end of the lease.
You gave up an asset (Cash of £1000) but has another asset: the right to £1000 at the end of the lease.
Thanks so much for the help!
This topic was automatically closed 14 days after the last reply. New replies are no longer allowed.