How to process a Rent Free Period in REST Professional 

Overview

The owner may offer a tenant a rent free period as an incentive for leasing a premises, commonly found in commercial leasing.

This document will cover the two methods of reflecting the rent free period in REST:-

  • Create a disbursement against the Property and receipt to Tenants rent
  • Amend the Tenant Details to reflect the rent free period

Create a disbursement against the Property and receipt to Tenants rent

This is the preferred method providing you have owner funds to do so. This creates an expense against the property, receipts it in to REST as rental income and charges management fees on the rent free period amount.

  1. Do a quick disbursement from the property. Go to Transactions > Quick Disbursements
  • Property – Select the owners property
  • Incl GST – Enter the amount of the rent free period (i.e. one week’s rent) ensuring that the GST amount is zeroed out.  (NOTE: If the amount is for commercial rent with a GST component, enter the exclusive rent amount  with $0.00 GST.  You will need to process the GST component by doing a second quick disbursement separately using cheque number 999999, description GST on One week's rent free period and the account code to be used is 119)
  • Cheque number – Use 999999
  • Pay to – Tenant’s Name
  • Description – One week’s rent free period
  • Account Code – Use your rent income code 101
  1. Click OK-F12

  1. Receipt the funds to the tenants rent. Go to Transactions > Rent Receipt
  • Select the tenant
  • Amount: Enter the Rent Amount (rent free period amount). NOTE: For commercial rents subject to GST, the receipt can be entered for the whole amount; total of the two quick disbursements, inclusive of GST.
  • Click OK-F12
  • Payment method: Direct Deposit
  • Received from: Enter the Owners name
  1. Click OK-F12

                                

Amend the Tenant details to reflect the rent free period

This method simply advances the dates and does not charge management fees and can be done if owner does not have the funds.

  1. Update the tenant paid to date on the Tenant Details. Go to Tenant Details > Rental Tab, Change the paid to date to reflect the rent free period (i.e. advance the date by 1 week)
  2. Click OK-F12
  3. You will then be prompted to give a reason which will appear on the tenant ledger. Reason: Rent Free Period as agreed

4.  If it is only a part payment of the rent period, you will need to enter the credit or add it to any credit already in Credit Last Month and enter a reason.

07/07/2017 5:15 pm AEST

Still need help?

Request a New Article

Popular Articles

New Articles

Updated Articles