Process rent free or rent reduced periods

Summary

Learn how to manage rent-free or rent-reduced periods in Palace. This article provides step-by-step instructions to ensure accurate rent records and tidy owner statements, including methods for processing rent-free periods and handling rent-reduced periods efficiently.


The rent-free period (allowing you to collect commission) essentially takes money from the owner and records it as rent against the tenant (which in turn goes back to the owner - less commission). To do this, we do a payment expense transaction and then a rent receipt transaction.

  • Go to Financials > Transactions
  • Click the drop-down under Generate Single Transactions
  • Select Payment - Expense
  • Click Generate

Payment_expense.png

  • Click the Owners drop-down
  • Search for and click on the property address
  • Under Expense, click the drop-down menu and search for the expense category
    • If there isn’t one already created
    • Click Add new next to Expense

Payment_expense-2.png

    • Enter a name in the description box. I.e., One-week free rent
    • The default text box can be left blank or a short message can be added

Note: Under System > List defaults, click the drop-down and select Supplier - Expense types. Here, you can add, enable, disable and delete categories.

  • Amount - Enter the amount of the rent-free period (if the rent-free period is for one week, enter the amount of one week's rent).
  • Ref. No - Enter a reference, i.e., For rent free period
  • Under Adjustments, zero the Maintenance % value. This is done so the owner is not charged a fee on this transaction (remember you will be getting the management fee on the rent)

Note: To avoid charging the owner a management commission for the rent receipt transaction, you must go into the property and zero out the management fee before you receipt the tenant's rent. Then, return to the property afterwards and put the commission back in.

  • Click Confirm
  • Click Process. This will deduct money from the owner's account

Once that is done, you may then receipt the rent against the tenant. This will update the tenant's paid-to date essentially providing a week's free rent.

There are two suggestions for handling rent-reduced periods

Method 1 - Leave the rent amount as it is. The tenant pays the reduced amount and the owner pays the remaining amount. I.e., Do a payment expense from the owner and receipt that amount as rent against the tenant. You then get the same commission as you would typically get.

Method 2 - Do a rent change for the reduced amount and set another rent change for the total amount on the date that the rent goes back to normal. View the help file on applying rent changes.

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