What is a Tenant Ledger and Why is it Important?
If you’re new to the world of renting, the term “tenant ledger” might be completely foreign or seem like just another bit of paperwork to complete. But it can be a powerful document for keeping track of payments, managing disputes and applying for future rental properties.
This guide will cover everything you need to know about tenant ledgers and why they are important, with some useful links for starting your own.
What is a Tenant Ledger?
A tenant or rental ledger is an official record of your rent payment history. It’s usually provided by either your landlord or property manager in an electronic format.
Generally speaking, a tenant ledger includes the date a rental payment was received and when the landlord/property manager issued a receipt, as well as the amount paid and exactly what it was for (ie. rent, electricity or water usage). If the payment was for rent, the ledger should include a “paid to” date, indicating the date that the rent is paid until (for example, two weeks from the date of payment). If there are any arrears (money owed), this should be documented also.
Additionally, a tenant ledger may include information about the property itself, including the land size, number of bedrooms and zoning.
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Why Do You Need a Tenant Ledger?
A tenant ledger is a useful document for ensuring that all of your rental payments are recorded and that you are on the same page as your property manager/landlord. As an official document, you can use it as a means of cross-referencing with your own records and to support any future rental applications. By showing that you are a reliable tenant who always pays their rent on time, you’ll be considered a trustworthy choice for other rental houses.
A tenant ledger may be required for taxation purposes and it can be requested if you end up in any legal issues with your rental situation. It is a particularly useful tool for both tenants and landlords to have at their disposal when dealing with property-related disputes.
For landlords, the tenant ledger also provides valuable information about the income derived from their investment and whether the investment is paying off. By seeing the money that is coming in and comparing it with the amount being spent on the property, the rental ledger can assist with future planning.
How to Obtain a Tenant Ledger?
Once upon a time, rental ledgers were physical documents. But today, they are electronic and simple to obtain. All you have to do is request it from your landlord or property manager and they will share an electronic copy with you.
If you’re a landlord or a renter looking to start a tenant ledger, you can find suitable rental ledger templates for Australia online.
How to Read a Tenant Ledger?
A ledger recording a tenant history will have four types of transactions listed:
Rent — payments made and whether they were paid on time or late
Invoices — payments made for invoices issued
Bond — payments made to the relevant residential tenancies authority
Deposit — money held on your behalf for future refund or allocation to your rental costs (rent payment/bond)
When it comes to interpreting the ledger meaning of your rental payments, there are a few terms that may crop up:
“Paid correctly - no credit” - rent was paid on time
“Paid incorrectly - no credit” - rent was paid late
“Credit” - additional payment was made early and credit has been added to the ledger
Ledgers and Rental Applications
A rental ledger can be a useful document to present as part of a rental application, particularly if it shows that you were reliable in paying your rent on time. Whether you’re applying in-person for a property or online through a rental platform, it will help your application stand out from the crowd. Make sure that it includes your name and that this matches what is listed on your photo identification.
How to Create a Tenant Ledger?
If you’re a landlord or a renter looking to start a tenant ledger, you can find suitable rental ledger templates for Australia online. Software has been created to assist in making rent ledger templates but you can also create one manually on a spreadsheet. Check out this tenant rent ledger template Excel Australia as a starting point.
Conclusion
It may seem like a lot of paperwork, but an accurate tenant ledger can be an invaluable document if and when disputes arise. For both renters and landlords, it provides up-to-date information on payments made and any money owing, as well as the dates when payments were received. Landlords can use this information to better manage their investments while tenants can use it as proof of their reliability for future rental applications.
