In Trust Accounting, you can manage the sale of a property via a Sales Trust Account and associated ledger(s). To use this functionality, navigate to the Sales tab within a Property.
Setting up a Sale transaction
To begin a Sale, click on Sell Property.
Enter the details of the Sale. The Vendor Contact will default to the Property Owner contact. The only required details that must be entered initially are the related Trust Account, and the Asking Price.
The commission structure can be specified by clicking the Add Commission/Fee button.
- Enter the Type of commission structure: Fixed, Percentage, Incremental tier, or Fixed tier. Based on your choices, the available options will change.
- Enter the Tax details of the commission.
- Enter the Contact the Commission will be assigned to. This will often be the Contact in Re-Leased that aligns with the Property Management Company.
- If the commission is to be shared, say between the Company and the selling agent, click Share. You can nominate the percentage share of the commission that should be allocated to each contact. This will allow you to process disbursements for paying out the commission from the Sales Trust account, diverting the correct funds to each party.
- Click Done to confirm the Commission structure.
Click Save to confirm the details of the Sale. To edit the details, click on the sale item that will be sitting under the Current tab in the Sales section of the Property record.
Funding the Sales Trust Account
The vendor of the property may wish to pay into the Sales Trust account in order to pay for expenses such as marketing costs. To do this, raise an Other Income Invoice, by clicking the dropdown menu and selecting Other Income.
Create the invoice on the following screen by filling out the relevant fields.
- To - Normally the Vendor contact funding the Sales Trust
- Issue Date
- Due Date
- PDF Template - Select a pre-defined invoice template for this type of transaction
- Reference
- Amounts Are - Tax Inclusive or Tax Exclusive
- Amount
- Description
- Account - The Chart of Account for the transaction
- Tax Type
Click Create Other Income to create the invoice. Once the funds are cleared and reconciled, the funds will appear as Available Funds in the Sales Trust Account.
Create an Expense
Paying funds out of the Sales Trust requires an Expense to be created. Click on New Expense from the dropdown in the Sales page.
Create the expense invoice by filling out the relevant fields.
- From - Normally the supplier/creditor contact to pay
- Issue Date
- Due Date
- PDF Template - Select a pre-defined invoice template for this type of transaction
- Reference
- Amounts Are - Tax Inclusive or Tax Exclusive
- Amount
- Description
- Account - The Chart of Account for the transaction
- Tax Type
Click Create Expense to create the invoice.
When there are unpaid expenses for the Sale, the Pay Expenses button will appear. To Pay the expenses out, click the button.
Select the Payment Method (Cheque or EFT), confirm the amount to pay, and click Save.
Enter any payment references required, and click Download Bank File, then Save and Continue.
From the following page you can download or email any remittance advices generated from the process. If emailing, select the email correspondence template using the dropdown selector.
Adding a Buyer to the Sale
Click on the Sale from the Sales page in the Property.
- Add a Sale price. If this price differs from the asking price, the commission structure defined will adjust the commission amount accordingly.
- Add a Buyer contact.
Creating a Deposit
To create a new Deposit transaction for the Sale, click on New Deposit. This type of transaction is to raise funds to be paid into the Sales Trust account from the Buyer of the property.
Create the Deposit invoice by filling out the relevant fields.
- To - Normally the Buyer contact
- Issue Date
- Due Date
- PDF Template - Select a pre-defined invoice template for this type of transaction
- Reference
- Amounts Are - Tax Inclusive or Tax Exclusive
- Amount
- Description
- Account - The Chart of Account for the transaction
- Tax Type
Click Create Deposit to create the invoice.
Once the deposit funds have been received and reconciled, they will show as part of the Available Funds against the Sale. The option to Release the Deposit will appear on the Sales page on the Property. Clicking this allows you to release either the full deposit or partial amount you specify. Follow the steps to create Cheque details, or create a Bank File to download and load into your online banking solution, and download or email the remittance advice.
Settling the final Sale proceeds
Once all sale funds have been receipted and reconciled, go into the Sale and click Save & Settle.
Adjust any payment methods or amounts for any outstanding Commissions, expense invoices, or final funds due to the Vendor. Click Save to continue, where you can create any necessary Cheque details, and download any Bank Files needed.
At the conclusion of the settlement process you can download a Settlement statement, which will look something like this, depending on your invoice template settings:
When the sale and settlement is completed, the Sale will appear in the Completed tab of the Sales Page, where you can click to see details or download another copy of the settlement statement.