Rental Income Concepts
Retirement villages means: Accommodation is intended for people who aged 55 or Above
Rental Income
Rental Income generally on Cash basic sometimes on Accrual basics
What is Rental Statement?
In Australia Property Management Agents will maintain the property behalf of owner, he will Collect Rent from Tenant and Incurred all Expenses related to rental property, for that he takes some agent fees balance money he will send it to Property Owner on Monthly.
So first we need to pass Journal Entry for Rent received from Bank
Bank a/c Dr xxx
To Rental Income xxx
How much Rental Income Received, what are the Expenses Incurred, what is the fees for property agent all those details Property Management Agent will provide property maintain statement, Property owner will receive this statement only at the time of Filing BAS or Filing Year End Tax Return.
So, for property owner whatever rental income received in Bank is Net Rental Income
For Example:
-
Bank a/c Dr 5170
To Rental Income 5170
(Being Net off Rental Income received)
Once Property Management Statement Received Following Entry will pass
-
Rental Income a/c Dr 5500
To Rental Income 5000
To GST Collected 500
-
Rental Expenses a/c Dr 400
GST Payable Dr 40
To Rental Income 440
-
Rental income Dr 110
To Reimbursement on Expenses 100
To GST on Reimbursement Expenses 10
As per Rental Statement we need to Prepare working paper and we need to Reconcile BAS Return with workpaper
Ultimately above Journal Entries result, will match with the Rental Income received in Bank
In addition to above Expenses if any Expenses Directly incurred by Property owner that expenses also, we need to adjust with rental income.
-
Rental Expenses Dr xxxx
To Bank xxxx
(Expenses incurred for property)
(Water Rates, Corporate Rates, Land Rates etc)
-
Rental Income Dr xxxx
To Rental Expense xxxx
(Being Rental Expenses adjusted with Rental income)
Conclusion
Refer Rental Property schedule
