Real Estate Bookkeeping & Property Accounting

Real estate bookkeeping requires specialized knowledge of commission-based revenue recognition, trust account compliance for transaction deposits and holdbacks, rental property accounting with income and expense tracking by property, capital improvement accounting versus repairs, GST/HST rules for real estate transactions, and property management financial reporting that differs fundamentally from other business types. Real estate professionals face unique challenges including managing irregular commission income, tracking deposits for transactions in progress, handling trust funds for real estate closings, managing multiple properties with different tax treatments, and complying with real estate board and brokerage requirements.

Our real estate bookkeeping services are specifically designed to address these industry-specific challenges. We understand that real estate professionals need accurate commission tracking and split calculations, compliant trust account management for transaction deposits, rental property income and expense tracking, capital improvement accounting for tax optimization, and data-driven insights for property investment decisions. Unlike generic bookkeeping providers, our team has deep expertise in real estate accounting including commission structures, real estate trust accounting, property management financials, and real estate tax planning strategies.

Real estate businesses also deal with complex cash flow management due to irregular commission timing, property maintenance expenses, mortgage payments, and capital improvement costs. Our real estate accounting expertise ensures that real estate professionals maintain accurate cash flow forecasts, manage tax obligations effectively, make informed decisions about property acquisitions and dispositions, and evaluate investment property performance based on sound financial analysis rather than gut instinct.

Commission tracking represents the revenue foundation for real estate brokerages and agents, requiring precise tracking of transaction values, commission rates, brokerage splits, agent franchise fees, and referral fee arrangements. Our commission tracking systems capture every transaction from listing through closing, ensuring accurate commission calculations and timely agent payments while maintaining complete audit trails that support brokerage profitability analysis.

We track gross commission amounts based on sale prices and commission rates, calculating brokerage commissions before agent splits. Our systems handle complex commission structures including graduated commission rates based on sales volume, different commission rates for listings versus buyer representation, team commission arrangements, and referral fee calculations. We deduct brokerage fees, franchise royalties, and marketing fees before calculating net agent commissions, ensuring accuracy in agent payments.

Agent split calculations consider individual agent commission percentages, team structures where commission is shared among team members, and brokerage policies for different transaction types. Our commission accounting tracks commission receivables from transactions in progress, holds commission for closing conditions, and releases payments when transactions close and funds are received. We also track commission clawbacks if transactions fall through, protecting brokerage financial interests.

Our commission reporting shows agent production rankings, commission income trends over time, profitability by agent, and commission pipeline forecasting based on pending transactions. Brokerages use this information to manage cash flow, plan for commission expenses, and evaluate agent performance and retention strategies.

Real estate trust accounting manages client deposits for transactions in progress, holdbacks for closing conditions, and commission trust funds until transactions close. Our trust accounting services implement comprehensive systems that track every trust deposit by transaction, maintain complete segregation of trust funds from brokerage operating accounts, and ensure compliance with real estate board trust account requirements. We understand that trust account violations can result in regulatory penalties and loss of brokerage license.

We manage multiple types of trust accounts including general trust accounts for routine transaction deposits, holdback trust accounts for funds held pending closing conditions, and commission trust accounts where commissions are held until closings complete. Our trust accounting systems track each deposit by transaction, client, and purpose, maintaining detailed ledgers that show exactly what funds are being held and why. We implement three-way reconciliations comparing bank balances, transaction ledgers, and total trust liabilities, ensuring accuracy and preventing trust deficits.

Our real estate trust compliance includes automated alerts for upcoming transaction closing dates when trust funds must be disbursed, required documentation flags for incomplete transaction files, and reconciliation reminders that prevent trust account errors from accumulating. We generate trust account summaries showing all pending transactions, trust balances by client, and upcoming disbursement requirements.

For property management activities, we manage tenant security deposits in separate trust accounts, tracking deposits by property and tenant, calculating interest where required, and ensuring proper handling of deposit returns or forfeitures. Our trust accounting handles the complexity of residential versus commercial property trust requirements, ensuring compliance regardless of property type.

Rental property accounting requires tracking rental income, tenant payments, property expenses, capital improvements, and mortgage interest for each property individually while enabling portfolio-level analysis for real estate investors. Our rental property accounting services implement comprehensive systems that manage every aspect of property ownership, ensuring accurate financial reporting, tax compliance, and investment performance analysis.

We track rental income by property and unit, capturing rent payments, late fees, parking income, laundry income, and other ancillary revenue. Our rent roll management tracks lease expiration dates, rental rate increases, tenant payment history, and vacancy periods. We monitor accounts receivable for overdue rents, generating tenant aging reports that inform collection efforts and lease renewal decisions.

Property expense tracking includes all operating costs such as property taxes, insurance, utilities, repairs and maintenance, property management fees, condo fees, and landscaping services. We allocate expenses to individual properties, ensuring accurate profitability analysis for each investment. Our property expense categorization separates routine repairs from capital improvements, ensuring proper tax treatment and maximizing deductions.

Capital improvement tracking captures major renovations, upgrades, and additions that must be capitalized and depreciated over time rather than expensed immediately. We maintain detailed records of improvement costs, track useful life for depreciation calculations, and calculate Capital Cost Allowance (CCA) schedules that optimize tax deductions while maintaining compliance.

Mortgage tracking includes principal and interest payments for each property, enabling calculation of cash flow versus equity buildup. We generate property-level financial statements showing rental income, expenses, net operating income, cash flow before and after mortgage payments, and return on investment calculations. This comprehensive reporting helps investors evaluate property performance and make informed decisions about buying, holding, or selling properties.

Professional real estate bookkeeping provides investors and real estate professionals with the financial intelligence needed to significantly improve investment returns through better property selection, operational efficiency, tax optimization, and portfolio management. Many real estate investors rely on rough calculations or incomplete records, but our detailed financial analysis enables data-driven decisions that materially improve investment performance.

Property-level profitability analysis reveals which properties generate the best returns and why. We calculate key metrics including capitalization rate, cash-on-cash return, gross rent multiplier, and operating expense ratio for each property. Investors often discover that properties they thought were performing well actually have poor returns when all costs are properly allocated, while seemingly modest properties outperform due to lower expenses or higher rental appreciation potential.

Operating expense analysis identifies cost-saving opportunities including tax appeals for over-assessed properties, renegotiating insurance premiums, implementing energy-efficient improvements that reduce utility costs, and optimizing property management staffing. Many investors reduce operating expenses by 10-20% through systematic expense management and vendor negotiation.

Tax optimization strategies including maximizing capital cost allowance on capital improvements, optimizing repairs versus improvements classifications, structuring ownership for tax efficiency, and implementing cost segregation studies on commercial properties. Our real estate tax expertise ensures investors capture all legitimate deductions while maintaining audit-ready documentation.

Portfolio analysis helps investors understand their overall real estate exposure, geographic concentration risks, and property type diversification. We track portfolio-level metrics including debt coverage ratios, loan-to-value ratios, and overall portfolio returns. This analysis informs acquisition strategies, disposition decisions, and portfolio rebalancing that enhances long-term returns while managing risk.

GST/HST rules for real estate transactions are complex, with different treatments for new versus used residential properties, commercial versus residential rentals, and different rules for developers versus investors. Our real estate tax services ensure proper GST/HST collection, remittance, and recovery on all real estate transactions, protecting investors from costly errors while optimizing tax positions.

For residential rental properties, we manage the exemption status and track when GST/HST must be collected versus when rentals are exempt. For commercial properties, we calculate and collect GST/HST on rent, track input tax credits on property expenses, and prepare GST/HST returns that properly reflect taxable rental income and recoverable taxes. We also manage GST/HST on property sales, determining when new housing rebates apply and calculating GST/HST payable on taxable sales.

Our GST/HST tracking systems monitor the tax status of each property, track input tax credits on acquisitions, and ensure proper documentation to support all tax positions. We help real estate professionals understand their GST/HST registration requirements, manage voluntary disclosure for past errors, and implement systems to track GST/HST on transactions in real-time.

For real estate developers and flippers, we manage GST/HST on new construction, renovations, and property sales, including new housing rebates and transitional rules. We understand the special GST/HST considerations for different property types and ensure compliance while maximizing legitimate tax savings.