How to account for rents received?

Accounting record rent received

Both a company and a real estate civil society can collect rent in advance but also certain charges. A condominium trustee or the rental SCI can then charge the amount to the tenant, a business can also use a condominium trustee to manage rental expenses.

Related topic : How do I report annual resources to the CAF?

Recordingofrentreceivedand advances on expenses in a rental IBS

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For an IBS or a business, rents are usually collected at the beginning of a month or period, to be able to more easily cope with all the costs that must be borne by the owner.

Rents have the status of product of the service type, while for a tenant these charges have the status of charge. The tenant is considered to be the client of the rental SCI. Rental fees can be paid as advance payments, it is only at the end of the year that the total count of all payments is made.

For the adjustment in the context of accounting, the different amounts must be recognised first as a credit and therefore as a debit. The comparison of the two parts (debit and credit), allows to make the calculation of the difference between provision and actual fees, and then determine the difference between the money received for the fees paid and the amount that can be returned to the tenant.

Accounting entry of the rent receipt

In an SCI, the rent is credited to the accounting account 7061, the advances on charges to account 4191, and the sum of these two amounts debited from Account 411.

Accounting entryforthereceiptof rent

On the recognition of the receipt, account 411 is credited to the amount received, and account 512 debited.

Accounting forthe rebilling of charges to the tenant at theend of the year

The actual owner may have to pay directly certain costs that the tenant will not have to pay, so it may be useful for his accounting to be able to manage all of these costs optimally in advance.

An SCI thus collects the price of rent and the cost of charges monthly and adjusts these amounts once a year. This means that part of the package of charges can be refunded to the tenant at the end of the year. The rent as such is actually validated also only at the end of the year, when the full accounting has been consolidated. In the meantime, the SCI or the company will also have to have set-off some overhead costs before making the final calculation.

Accounting entry of the regularization receipt

At the end of the year, rental expenses are credited to accounting account 7062, advances on charges debited from account 4191, and the balance of these two amounts debited from account 411.

Accounting Writing oftheCash

To the finding of the receipt, account 411 is credit for the amount collected, and account 512 debited. The balance of account 4191 should therefore be cleared naturally.

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  • 14 juin 2019
  • / Benoit MORTIER

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