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  • Property Accounting Software Options?

    Hi All,

    I am doing some research what software people use for book keeping, bank reconciliation and so on?

    I have invested some time into Xero and seemed fine up till the point I was dealing with only one of my companies, but it seems its quite difficult to manage multiple GST registered entities in Xero. For example I supposed to buy new subscriptions for each company, what is fine, but then I need to setup the very same bank feeds again and start re-reconciling the expenses in that account again? How can I cross reference them in between the different xero accounts,? seems headache to me.

    Question:

    If you have a rental and a trading company, what software you use to separate the costs, or how do you do it in xero? I might be missing something, not sure
    And on top of that lets say you have a day time job or a third business (employment) what gives your main income, this money goes to a RC account (so you save on interest) and you spend property business expenses from this RC? it can get messy very quickly, so need a good system to track costs, expenses, income streams.

    hope the question makes sense,
    Thanks for any inputs! suggestions. Cheers
    Last edited by propertybuyingNZ; 25-08-2016, 12:32 AM. Reason: typo

  • #2
    I tried xero but could seem to do multi properties setup with multi units under that
    After a bit of frustration i choose Money Works Gold
    Bit more expensive initially but cheaper in the long run
    I like the you can do transactions and reports where there is no internet
    Ps i have 6 companies and 60 properties

    Comment


    • #3
      I use a Property Management software system that deals with property portfolios and administration - multi -companies can be set up - and it integrates with Xero. Feel free to PM/email me and I can send you video link on it

      Comment


      • #4
        We use myob and quick books. Great for multiple entities.

        Comment


        • #5
          Originally posted by propertybuyingNZ View Post
          Hi All,

          I am doing some research what software people use for book keeping, bank reconciliation and so on?

          I have invested some time into Xero and seemed fine up till the point I was dealing with only one of my companies, but it seems its quite difficult to manage multiple GST registered entities in Xero. For example I supposed to buy new subscriptions for each company, what is fine, but then I need to setup the very same bank feeds again and start re-reconciling the expenses in that account again? How can I cross reference them in between the different xero accounts,? seems headache to me.

          Question:

          If you have a rental and a trading company, what software you use to separate the costs, or how do you do it in xero? I might be missing something, not sure
          And on top of that lets say you have a day time job or a third business (employment) what gives your main income, this money goes to a RC account (so you save on interest) and you spend property business expenses from this RC? it can get messy very quickly, so need a good system to track costs, expenses, income streams.

          hope the question makes sense,
          Thanks for any inputs! suggestions. Cheers
          Hi,

          I think you need to get some guidance around your general accounting first.

          - each entity should have its own set of books and be completely separate to other entities
          - your personal spending and income should be separated.
          - be very careful using a revolving credit that is both business and personal. You will find the deductibility of interest is less than you think and reduces over time.

          Any system can work fine, and it is often what is best for you. And what you want to achieve from the system.

          Ross
          Last edited by Perry; 25-08-2016, 02:07 PM.
          Book a free chat here
          Ross Barnett - Property Accountant

          Comment


          • #6
            Thanks guys!

            valid points Ross, but:
            - how do you structure a property purchase then, where you have a fat RC on your residential property, you have main income comes there (to save on interest) and you only have funds for an IP deposit on that account?
            - how can you utilize the rental income against your RC? is there a way at all? especially if its substantial?


            How much you guys pay monthly for the myOB, Bob?

            Cheers!

            Comment


            • #7
              Maybe discuss with accountant or mortgage broker. Note, sometimes you can't have everything!

              Also forgot to mention, also shouldn't have trades and holds in same entity.

              Ross
              Book a free chat here
              Ross Barnett - Property Accountant

              Comment


              • #8
                How I check my rentals, accounts wise:
                - check once or twice a week for rents
                - manual transfer money between accounts at the end of each month in anticipation of upcoming mortgage interest/rates payments
                - keep all my paper receipts in a folder, and compile a big but neat tidy ring binder for my accountant
                - business/personal accounts all separate so they don't mix up
                - my accounting fee has been pretty low over the years, so I must be doing something right!

                Yes I'm pretty primitive when comes to accounting, but accounting is not where the money is made.

                I have Xero too, but I only use it to upload invoices that I take pictures of now.

                Comment


                • #9
                  thanks Ross and Gary!

                  so Gary, where did you pay your first deposit from? I guess you have RC on your home, how does the initial payment was sorted out between the different bank accounts? you transferred over the deposit from your RC to the bank account associated with the IP then paid the seller from there?

                  What happened when refinanced and you got new RCs on the individual IPs? you moved all the RC funds to a third bank, what financed the new purchase?

                  and did you set up one bank account per property? or at least one bank account per properties with the same bank? Or all the rents are coming in to one bank account and you distribute from there to the individual bank accounts?

                  sorry about the heaps of questions, wanna get to the bottom of it.

                  (side note: in the UK you can dedicate an business bank account and mortgage companies debit this account to get the monthly payments, you than have all the rent going in to this account and its all sorted, but in NZ seems every bank wants you to have a current account as well, have the mortgage paid from their own current account, meaning a lot of unnecessary head ache of fund transferring (ASB, ANZ and westpac at least))

                  Comment


                  • #10
                    I use a spreadsheet!
                    1 main transaction account with auto-payments to keep the other accounts ready to pay the mortgages.
                    All expenses recorded in the XLS under appropriate heading - accountant happy as all the totals are there and I have routines to make sure they all balance to the cent at end of year.

                    Comment


                    • #11
                      Originally posted by propertybuyingNZ View Post
                      so Gary, where did you pay your first deposit from? I guess you have RC on your home, how does the initial payment was sorted out between the different bank accounts? you transferred over the deposit from your RC to the bank account associated with the IP then paid the seller from there?
                      You need to learn how "no-money-down" works. Yes I had a RC against my own home as deposit, so I can use the RC to buy rentals with different banks. Initial deposit and balance to settle are all from RC.

                      Originally posted by propertybuyingNZ View Post
                      What happened when refinanced and you got new RCs on the individual IPs? you moved all the RC funds to a third bank, what financed the new purchase?
                      What I did was I top up the loans on my IPs, then repay myself back into my RC. I never had a RC on my IPs. Once my RC is replenished, I go buy again.

                      Later on when I was drowning in equity, I just used the IPs to borrow 100% on new purchases.

                      Originally posted by propertybuyingNZ View Post
                      and did you set up one bank account per property? or at least one bank account per properties with the same bank? Or all the rents are coming in to one bank account and you distribute from there to the individual bank accounts?
                      One account per bank.

                      Also all my IPs (long term buy and hold) are in one LTC. If you are using multiple entities, then yes you should get different accounts even under one bank.

                      I use BNZ as my transaction accounts so all rents go into this account (Total Money Offset account, so more money I have in the account less interest I pay). Then every month I transfer money for mortgage interest to other banks.

                      Comment


                      • #12
                        cool, thanks Gary, really handy!

                        so I understand well:
                        BNZ is the main account gets all the rent, and its an offset account against the debt on your resi property, or one of the rentals?
                        and your salary comes to a totally different account? so its not utilized to reduce the RC?

                        main argument in my current setup was (and evidently a chaos it created) to get all income into the RC account so I maximize the savings on the interest.
                        after all, if you are a sole trader, no LTC, then it might be a viable route? just messy, so your accountant will be sad, but you maximize saving, but if you have legal entities in the picture then its not a viable option any more.

                        Comment


                        • #13
                          Originally posted by propertybuyingNZ View Post
                          just messy, so your accountant will be sad, but you maximize saving, .
                          It is a bit more than messy. The interest on the amount you borrow to buy the rental property from your RC will be deductible to start with. But slowly as you repay this, then use it to pay personal expenses, you'll find that the loan attributable to your rental as reduced. So slowly over time you might only be claimed 95% of the interest, then a year later might be 90% and will keep reducing.

                          Ross
                          Book a free chat here
                          Ross Barnett - Property Accountant

                          Comment


                          • #14
                            Also if you still have a debt on your personal house, it is pretty simple to separate! You can use a revolving credit just for personal, and put all your wages into there!

                            You could also have a revolving credit for your rentals, with the rent going into there.

                            By keeping simple, you make accounting much simpler and also keep it very clear what is deductible.

                            Ross
                            Book a free chat here
                            Ross Barnett - Property Accountant

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