How to Define Management Fee Settings?

    • Tanvir Mahedi |
    • 0 step |
    • 5 minutes
      Alert- The Management Fee functions as a service charge for property owners in exchange for the management of their properties. In our portal, we have simplified the process of calculating management fees, offering a crucial setup configuration for property managers during the initial property setup. This setup can be completed on the property details page. Our software, operating in accordance with the management fee settings, automatically calculates and generates necessary transactions when rent payments are received. Within the portal, there is an option to incorporate management fee settings for your portfolio.
      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.
      You can globally configure management fees setup or set them for individual property.. Select the property to configure.
      Alert- The property drop-down list only shows properties that are set (on the property details page) to be managed by property managers
      Select (Monthly) management fee type. You have the flexibility to tailor the fee percentage according to those fields, allowing for customization on a per-property or per-unit basis
      This is the appearance following the initiation of this configuration
      Specify the date of the month you want the system to process this fee (for the previous cycle's rent collection)
      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.\ \ **F**or 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.
      Select the "Yes" option to generate the management fee invoice automatically
      Use this dropdown to choose the day for generating the management fee invoice.
      Opt for selecting "Yes"- "Do you want to automatically close the management fee invoice if there is enough recorded income? (auto generate invoice must be on)?"
      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?" the first of the two options is preferable when compared to the third 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
      Generally, it is not advisable to choose the third option
      Click the "mm-yyyy" field to set the date from when you start charging the management fee for this property
      This option primarily functions as a flag. It's crucial to take note of this highlighted information, especially for property managers
      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 configuration of the "Discount Period" is intended to offer discounts 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
      Choose the tax percentage if you are going to charge any 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 save your settings
      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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