Note that this article refers to security deposits held by the agency under an insurance based protection scheme.
In the event of a tenant vacating a property and leaving unresolved damages or rent arrears, the deposit may be returned to the landlord instead of the tenant.
- Select Bank -> Tenant Transactions from the main menu
- Identify the relevant Property and, if required, the appropriate Tenant.
- Select the Payments (Outgoing) tab.
- Choose a type of 'Return of Security Deposit'
- For the Bank Account select a Suspense (or dummy) account as the funds will not be actually returned to the tenant. The process for creating a new bank account is detailed here.
- The Payment Medium should be set to 'Other'.
- Enter a Description of 'Funds retained due to dilapidations', or similar
- Complete the remaining transaction details and submit
We now need to credit the landlord balance of the associated property. This can be achieved by applying an expense with a negative value against that property.
Comments
2 comments
I have done this. All is fine but in the tenant statement it shows that the payment has been recieved from the tenant but not that it has gone to the landlord. it is therefore showing that the tenant is in credit which is not right.
How do I do this so that it is removed from the tenant statement?
I will also have to show int he bank that the money has gone through the account to the landlord. Is there anything I need to be aware of when i do this so it shows on tenant and landlord reports correctly?
Mike
Hi Mike,
To ensure that the tenant does not appear to be in credit you'll need to apply a corresponding Tenant Expense.
The reference to marking the Tenant Transaction as being paid directly to the landlord was misleading and has been updated.
Brian
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