How To Configure Management Fee Calculation?/How to Configure Management Fee Settings?

    • Tanvir Mahedi |
    • 0 step |
    • 5 minutes
    Tip- Management Fee is a form of service charge to the owner for managing their properties. In our portal, we have automated the management fee calculation for you. It is a very important configuration that the property manager should set at the beginning of the property setup process. This can be set from the property details page. \ \ Based on the management fee settings, our software automatically calculates and recreates necessary transactions when the rent payment is received. To set up management fees, please follow the steps below:
    Log into the Admin Portal
    Click on the "**Settings**" icon on the top left corner of the screen
    Click on "**Management Fee Settings**"
    "You are viewing default settings. If you did not setup management fee for a property, default settings will be used. Please select a property to view property level settings" - this pop up is a combination of the **Global setting in the management fee** & an indication for you to configure the the management fee for a **property/properties**
    There are 2 types of management fee settings-\ \ 1\. Global Settings which can termed as Default Settings as well. This applies only when there are no specific settings set for the property/properties.\ 2\. Property level settings which you can set easily for each property.\ \ \ \# Global Settings, also referred to as Default Settings, come into effect only when no specific settings are configured for the property or properties.\ \ \# You have the option to easily establish Property Level Settings for each property.
    Click on "-- Select a property to view property level settings --" dropdown under "**Property**" to choose a property
    You have the option to select from these **squared fields to compute** the management fee. You can also **customize the fee percentage** based on those fields along with setting them **per property/unit**
    For instance, in this case, we selected the "**Percentage of Invoice**" field to **calculate the management fee**.
    Select the "**0%**" field. Here, you have the option to define the **percentage of the invoice** that you wish to set as the management fee.
    This is how it would look after the initialization of this set up
    Click on this dropdown under "MONtHLY CYCLE START DATE (On what day do you report to the owners) of this property?" to select the **cycle start date**
    Reminder Alert: "If you select 1st, management fee calculation will consider all the rent collected from day 1 to the last day of the month (i.e. 1st June to 30th June)..." If you select 15th, management fee calculation will consider all the rent collected from 15th of the last month to the 14th day of current month(i.e. 15th June to 14th July)
    This **highlighted note** is of high importance to be aware of as a property manager
    Note - **Management fee income and monthly owner statements is generated based on the income and expenses of one month period.\ \ The period starts from the selected date of the previous month to one day before the next cycle start date.\ \ For example- if you select 15th as the cycle start day, the period will be from the 15th of the previous month to the 14th of the current month.\ If you change the cycle start date, make sure to DELETE the existing management fee invoice and regenerate it by going to Accounting > Owner Payout > Search Management Fee Income.**
    **Reminder Alert- If you are changing the monthly cycle of an existing settings, you may need to review the auto generated 'Management Fee' invoices (if exists). Updating the monthly cycle will affect the invoice total.**
    Click the "**Yes**" field to automatically generate management fee invoice
    Click on this dropdown to select the **day** to generate the management fee invoice
    Choose to click "**Yes**" on "Do you want to automatically close the management fee invoice if there is enough recorded income? (auto generate invoice must be on)?"
    "**AUTO GENERATE**"- When selected, the system will automatically generate the 'Management Fee' invoice, one day after the monthly cycle ends.
    This highlighted note is of high importance to be aware of as a property manager
    Reminder Alert -:\ \ **AUTO COLLECT- When selected, the system will automatically process the invoice (add payment and mark paid. Considering the collected rent in the period is enough to cover the management fee). \ \ If the collected rent amount does not/could not cover the management fee, the invoice will remain open for manual processing (system may add partial payment if collected rent can cover partial management fee amount).**
    Under "How would you like to pay the owner(s) of this property?" **first of the 2 options** are recommended compared to the 3rd one
    Here for instance, we chose the 2nd of option which is the "**Recorded** 'Payment date' for an invoice" field. This one is the **most popular choice** for the Property Managers
    This 3rd option is not recommended generally
    Click the "**mm-yyyy**" field to set the date from when you start charging the management fee for this property
    This option works mostly as a **flag**. This highlighted note is of high importance to be aware of as a property manager
    Tip- **"In some cases, you may have added a property in the system, but you would probably start charging the management fee from a future date. For example, you added a property in January, but you would start charging the management fee from June. You select the June date here, so that in any of the owner report, we do not display any management fee for this property**
    The **"Discount Period"** set up is to provide discount at the invoice level
    Click the **"mm-yyyy**" field under "CURRENT OWNER VISIBILITY (Optional)" if you want to make the report visible to the owner
    Click on "**Nothing selected**" dropdown under "TAX ^+& DEPOSIT ACCOUNT" to select the type of taxes
    Click the "**Yes**" field.
    Click "**-- Select deposit account (optional) --**" to choose the account where all the management fee income will go with taxes.
    **Alert- You can segregate the management fee income from your rental income from the property by selecting this option. This is just an extra option**
    Click on **'Save Setting Information**" button to finish up
    **Alert- Please note that this is a very important setup. These settings will impact accounting transactions, reports including the owner's disbursement report**
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