How to handle key deposits

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Key deposits and other "security" deposits need to be handled differently than the "advance" deposits.  When you use the "Deposit" transaction, that's assumed to be an advance deposit that will be applied to the rent or other charges.  However for security deposits you don't want this -- and you probably want the balance to show $0 even though they've paid the deposit, and be able to refund that deposit when they leave.

 

Here's what we recommend for this:

 

Set up a Transaction Category of "Security Deposit" if it's not already there (anything besides "Deposit" will work, which is reserved for advance-deposit transactions).

 

At the beginning of their stay (or whenever you need to enter this type of deposit):

--- Enter a Charge transaction for the security deposit, using that Security Deposit category.

--- Enter the payment for the deposit as a normal Payment transaction (or as just part of their check-in payment).

 

This will show the deposit as income now, but you'll have a record of the security deposit because of the Charge transaction, and the separate category allows you to separate it if needed.  It will also zero-out the customer's "balance due" so you don't get misleading balance reports.

 

Now when they leave:

--- Select the original Security Deposit transaction and click Reverse Charges to negate it, which will add a negative Charge. (If you're using an older version, you need to manually enter another Charge transaction with the "Security Deposit" category, using a -1 quantity, to show that the security deposit is being removed.)  This will give them a credit balance.

--- Enter a Refund transaction if there's still a credit left after any final charges.

 

Of course you can also set up Rate definitions to simplify this, or even have it add the security deposit automatically as an add-on (assuming you use auto-rates).  When they leave, go to Select Rates, add the security deposit, and check the box at the bottom to "Invert Amounts" so it's added as a negative charge.

 

 


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