Forum Discussion

9 months ago

Purchase of property

Hi, I need to enter a purchase of a property with deposit paid on contract signing and loan drawdown on settlement of property two months later. How do I enter these transactions in Myob Accountright...

Princess_R
9 months ago
Hi acplus21,

Thank you for your post, and welcome to the Community Forum!

To manage the purchase of the property, the Spend Money and Receive Money options. The initial deposit made at the time of contract signing can be documented as a Receive Money transaction, while the loan drawdown at settlement and the actual property purchase can be recorded as a Spend Money transaction. While you can also use a journal entry for this purpose, it's advisable to consult your accountant first. This ensures that you record the transaction correctly, using the appropriate accounts for your accounting needs, and complying with tax regulations accurately.

Feel free to create a new post again if you need further help.

If my response has answered your inquiry, please click "Accept as Solution" to help other users find this information.

Cheers,

Princess

Princess_R

MYOB Moderator

9 months ago

Hi acplus21,

Thank you for your post, and welcome to the Community Forum!

To manage the purchase of the property, the Spend Money and Receive Money options. The initial deposit made at the time of contract signing can be documented as a Receive Money transaction, while the loan drawdown at settlement and the actual property purchase can be recorded as a Spend Money transaction. While you can also use a journal entry for this purpose, it's advisable to consult your accountant first. This ensures that you record the transaction correctly, using the appropriate accounts for your accounting needs, and complying with tax regulations accurately.

Feel free to create a new post again if you need further help.

If my response has answered your inquiry, please click "Accept as Solution" to help other users find this information.

Cheers,

Princess

Song
Contributing Cover User
9 months ago

Hi Princess_R

Thanks for your reply to acplus21. I have the same question.

I find that using Recieve Money and Spend Money is easier for me to record a purchase of property.

I am confused about using Recieve Money to record deposit made on signing contract (10% of the contract price), and again on settlement (anothe 10%).

I have created -
Asset account for the purchase, contract price; and asset accounts for stamp duty, legal etc
Liability account for loan advanced by lender
Expense account for interest

Which account (asset, liability, expense or equity) to go for deposits made? Receive Money from which account to which account?

Shall I put all entries in Spend Money against the settlement statement?

Thank you in advance.
- Earl_HD
  MYOB Moderator
  9 months ago
  Hi Song,
  
  Thanks for your post. In this situation, it's best to consult with an accountant for accurate guidance. Generally, when recording property purchases and deposits in MYOB:
  
  Use "Receive Money" for deposits, with the "From Account" being your bank account and the "To Account" as the asset account for the property purchase.
  
  For expenses like stamp duty and legal fees, use "Spend Money" with your bank account as the "From Account" and the appropriate expense account as the "To Account."
  
  For deposits:
  
  Use "Receive Money" to record the 10% deposit on signing the contract, selecting your bank account as the "From Account" and the property's asset account as the "To Account."
  
  Similarly, use "Receive Money" for the 10% settlement deposit, with your bank account as the "From Account" and the property's asset account as the "To Account."
  
  Feel free to post again, we're happy to help!
  
  If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.
  
  Regards,
  Earl
  - Song
    Contributing Cover User
    9 months ago
    
    Thank you Earl_HD
    
    All numbers balance now.
    
    Regards,
    Song