Why Do You Need A Short Term Rental Expense Spreadsheet
If youre renting out a vacation home you might be wondering, why do I need a short term rental excel template? Ultimately, the goal for all vacation rental tasks is to make it as easy and painless as possible. When you use a vacation rental income and expense worksheet, you minimize manual accounting work. Adding this spreadsheet to your toolkit just makes sense.
How To Streamline The Process Of Tracking Your Bottom Line
While employing a short-term rental spreadsheet is a tried-and-tested way to track your finances, it still requires a great amount of manual work. And its a known fact that manual work is prone to human error.
Automating the process of monitoring your income and expenses can eliminate manual tasks and ensure that no pesky error will sneak in. For example, vacation rental software like iGMS enables hosts and property managers to track metrics relating to the performance of their business as well as guest communication within a unified Dashboard.
It also offers PROtrack a unique guest communication productivity tracking toolkit to make sure your guest support agents never drop a ball.
The iGMS Dashboard provides a clear-cut overview of the following metrics:
- Total revenue in the selected currency
- Number of active properties
- Number of confirmed reservations for the current month
- Average daily revenue
Rental Property Analysis Spreadsheet
Its important for real estate investors to keep an eye on the bottom line. Thats why a rental property analysis spreadsheet is one of the most important tools you can use when analyzing the current and potential performance of income-producing real estate.
A good rental property spreadsheet keeps all of the property income and expense data in one place and helps estimate the potential profitability of each real estate investment.
In this article, well show you how to make your own rental property analysis spreadsheet, explain why cash flow is so critical to real estate investors, and give you a free rental property analysis spreadsheet that you can download and customize for your own real estate business.
Simplify your rental property reporting
What Is Capital Cost Allowance
You might acquire a depreciable property, such as a building, furniture, or equipment, to use in your rental activities. You cannot deduct the cost of the property when you calculate your net rental income for the year.
However, since these properties may wear out or become obsolete over time, you can deduct their cost over a period of several years. The deduction is called capital cost allowance .
You can usually claim CCA on a property when it becomes available for use.
Area A Calculation Of Capital Cost Allowance Claim
The Government of Canada’s 2018 Fall Economic Statement was tabled on November 21, 2018. As a result, columns 4, 7, and 8 have been added to Area A to accommodate the legislation. For more information on how this could affect your CCA calculations, go to Accelerated Investment Incentive.
Column 1 Class number
Enter in this column the class numbers of your properties. If this is the first year you are claiming CCA, see Column 3 Cost of additions in the year below before completing column 1. If you claimed CCA last year, you can get the class numbers of your properties from last year’s form.
We discuss the more common types of depreciable properties in Classes of depreciable property.
Generally, if you own several properties in the same CCA class, combine the capital cost of all these properties into one class. Then enter the total of the combined properties that are represented under one class in Area A’s calculation table. If you acquired a rental property after 1971 and it had a capital cost of $50,000 or more, you have to put it in a separate class. Calculate your CCA separately for each rental property that is in a separate class. Do this by listing the rental property on a separate line in Area A’s calculation table. For CCA purposes, the capital cost is the part of the price that relates to the building only.
Column 2 Undepreciated capital cost at the start of the year
Column 3 Cost of additions in the year
Area B Equipment additions in the year
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How To Create An Str Spreadsheet
Heres an excerpt from an Excel spreadsheet template for an STR property, using estimated figures for illustration purposes only. The STR spreadsheet can be downloaded for free in an Excel or format and easily customized.
Instead of using a spreadsheet, a much easier method is to use software from Stessa, a Roofstock company. After signing up for a free account, enter the property address and link business and mortgage accounts to begin automatically tracking income and expenses.
This post on Stessa Support explains in detail how to use the software for an STR.
Investors who have past transaction data from a site like Airbnb also can download the transaction history, then upload it to Stessa. Most, if not all, of the transactions will be automatically categorized.
Stessa works with an unlimited number of STRs, single-family rentals, and small multifamily properties. Stessa is free and also offers premium services, such as rent analysis, mortgage financing, and market research.
With Stessa you can:
- Track STRs, single-family homes, and small multifamily property.
- Automatically track income and expenses, property value, and owners equity.
- Monitor property performance in real time at both the portfolio and property level via the owners dashboard.
- Generate financial reports and export tax-ready statements to save time and money.
- Organize and store STR real estate documents safely and securely online.
- Use iOS and Android mobile apps to track expenses on the go.
How To Calculate Cash Flow
Cash flow is the difference between income and expenses, before taking into account depreciation expense and personal income tax.
When you calculate the potential cash flow of a rental property, it can be easy to overestimate income and underestimate expenses. After creating your cash flow statement, its a good idea to run various what-if scenarios to see how the cash flow is affected in different situations.
For example, is the property still cash flow positive if rental income goes down? How do different vacancy rates affect property cash flow? Also, how long does it take to become cash flow positive again if you need to make a major capital repair such as a heating and cooling system or roof replacement?
Here are the Items investors typically include in a cash flow analysis:
Special Concerns When You Hire Employees
If you have employeessuch as a resident manageryou must create and keep a number of records, including payroll tax records, withholding records, and employment tax returns. And you must keep these records for four years. For detailed information, see IRS Circular E, Employer’s Tax Guide. You can get a free copy by calling the IRS at 800-TAX-FORM, by calling or visiting your local IRS office, or by downloading it from the IRS website. Also, contact your state tax agency for your state’s requirements. A list of all 50 state tax agency websites can be found at TaxSites.com.
Dont Let Any Business Expense Slip Past You
From routine cleanings to monthly mortgage payments to maintenance tasks, there are many different expenses that you need to pay and track. So, it is quite easy to miss an expense, especially when it comes to one-off expenses. A short-term rental spreadsheet will help you to allocate your operating costs helping to streamline your bookkeeping.
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How To Create A Rental Property Analysis Spreadsheet
Begin by choosing a spreadsheet software program such as Google Sheets, Microsoft Excel, LibreOffice Calc, or Open Office Calc. Doing a rental property analysis on a spreadsheet makes updating much easier when you are analyzing multiple options before choosing the best property to invest in.
Next, set up your rental property analysis spreadsheet by following these four steps:
What Does The Vacation Rental Income And Expense Worksheet Cover
Our short term rental expense spreadsheet allows you to write in all the expenses and purchases youve made for your vacation rental on a yearly and monthly basis. The template already includes some basic costs, such as cleaning products and property management tools, but you can customize it to meet your needs. For example, if one of your properties has a pool, you can put in the maintenance fees associated with the amenity so you dont lose track of how much the upkeep is costing you.
Beyond expenses, you can also evaluate your income and income expectations. You can add in the gross income for each month and compare that to your expected earnings. Additionally, youll get a rough estimate of what your average nightly rate is for each month.
Lastly, youll be able to contrast your expenses to your earnings to better understand profit margins and what percentage of your earnings are going to expenses and fees.
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Handling Business Taxes Online
Use the CRA’s digital services for businesses throughout the year to:
- make a payment to the CRA online with My Payment or a pre-authorized debit agreement, or create a QR code to pay in person at Canada Post
- file a return, view the status of filed returns, and adjust returns online
- submit documents to the CRA
- register to receive email notifications and to view mail from the CRA in My Business Account
- manage addresses
For more information, go to E-services for Businesses.
CRA BizApp is a mobile web app for small business owners and sole proprietors. The app offers secure access to view accounting transactions, pay outstanding balances, make interim payments, and more.
You can access CRA BizApp on any mobile device with an Internet browserno app stores needed! To access the app, go to Mobile apps Canada Revenue Agency.
Receiving your CRA mail online
Sign up for email notifications to get most of your CRA mail, like your notice of assessment, online.
For more information, go to My Account for Individuals.
MyBenefits CRA mobile app
Get your benefit information on the go! Use MyBenefits CRA mobile app throughout the year to:
For more information, go to Mobile apps Canada Revenue Agency.
How Much Cca Can You Claim
The CCA you can claim depends on the type of property you own and the date you acquired it. Group the depreciable property you own into classes. A specific rate of CCA generally applies to each class. We explain the most common classes of depreciable rental property and the rates that apply to each class under Classes of depreciable property in this guide.
For the most part, use the declining balance method to calculate your CCA, as it is the most common one. This means that you apply the CCA rate to the capital cost of the depreciable property. Over the life of the property, the rate is applied against the remaining balance. The remaining balance declines each year that you claim CCA.
Last year, Abeer bought a rental building for $60,000. On her income tax return for last year, she claimed CCA of $1,200 on the building. This year, Abeer bases her CCA claim on her remaining balance of $58,800.
You do not have to claim the maximum amount of CCA in any given year. You can claim any amount you like, from zero to the maximum allowed for the year. If you do not have to pay income tax for the year, you may not want to claim CCA. Claiming CCA reduces the balance of the class by the amount of CCA claimed. As a result, the amount of CCA available for you to claim in future years will be reduced.
Limits on CCA
You cannot use CCA to create or increase a rental loss. Do not apply the half-year rule to accelerated investment incentive properties or zero-emission vehicles.
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Project Repair Rehab And Updating Costs
If youre buying a property that requires immediate repairs or updating, ask your local property manager to provide you with three quotes from different contractors so that you can compare the bids. Also, ask your manager to verify whether the local building codes will require you to use a licensed contractor or a more affordable handyman for the work.
A good way to reduce the potential risk of underestimating repair and rehab costs is to invest in a turnkey rental property from the Roofstock Marketplace. Homes have been pre-inspected and the odds that youll need to make any repairs right away are much lower.
During the time you own the property, you may choose to do updating to add value and increase the rents. Be selective about the projects you choose to do, to ensure youre getting the best potential return on your updating investments.
What Is A Rental Property Spreadsheet Template
A rental property spreadsheet is a document that keeps all of your property expenses and income data in one safe, verifiable place. It helps property owners keep track of monthly rent costs and property taxes, and it calculates the totals of any property-related expenses owed. A template for this document provides you with a specific format to include all of the information you need.
So what goes into a rental property spreadsheet template? This will depend on whether youre using it as a landlord or an owner, as well as how many properties you manage. But the common details you can expect to find include:
- Original purchase price of the property
- The market value of the property
- Financial data like mortgage payments, interest, and deposits
- Property taxes and insurance
- Maintenance requests and any ongoing maintenance tasks
- Lease agreement details, such as the start and end date of the lease
- Tenants information, including contact details, ID documents
As you can see, managing real estate is complex. Thats why a rental property spreadsheet template can be so advantageous.
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Key Metrics For Airbnb Spreadsheet
Now its time for you to decide on the performance metrics that you wish to track on your Airbnb spreadsheet. This is the fun bit!
Microsoft Excel is incredibly powerful with what it can do. Once you have all your revenues and expenses tracked, youre able to manipulate the data to show you want. Youll even be able to create beautiful graphs and charts to display data as well.
So first things first, what Airbnb metrics should you calculate on your spreadsheet?
For starters, the most important thing is your earnings. All you need to know is if you are making money or not. I mean, what else matters, right?
Below are some ideas of key metrics to track:
Gst/hst Rebate For Partners
To determine if you are a partner, see Are you a co-owner or a partner of a partnership?
If you are an individual who is a member of a partnership, you may be able to get a rebate for the GST/HST you paid on certain expenses. The rebate is based on the GST/HST you paid on expenses you deducted from your share of the partnership income on your income tax return. However, special rules apply if your partnership paid you an allowance for those expenses.
As an individual who is a member of a partnership, you may qualify for the GST/HST partner rebate if you meet the following conditions:
- the partnership is a GST/HST registrant
- you personally paid GST/HST on expenses that:
- you did not incur on behalf of the partnership
- you deducted from your share of the partnership income on your income tax return
However, special rules apply if the partnership reimbursed you these costs.
Examples of expenses subject to the GST/HST are vehicle costs and certain business-use-of-home expenses. The rebate may also apply to the GST/HST you paid on motor vehicles, musical instruments, and aircraft, for which you deducted capital cost allowance .
The eligible part of the CCA is the part that you deduct on your tax return in the tax year that relates specifically to a motor vehicle, musical instrument, or aircraft on which you paid GST/HST. It would also be eligible for the rebate, to the extent that the partnership used the property to make taxable supplies.
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What Is An Str Spreadsheet Used For
An STR spreadsheet is used to keep track of income and expenses and the bottom line. Using a spreadsheet can save you time and money and make reporting easier when tax times rolls around.
There are a lot of guests coming and going in an STR, and manual accounting can quickly become overwhelming.
Based on an average length of stay of 6 nights, an STR property with an occupancy rate of 60% could have nearly 40 income entries and hundreds of expense entries over the entire year. Thats a lot of transactions to keep track of, and data could easily fall through the cracks.
What Can I Deduct
Costs you incur to place the property in service, manage it and maintain it generally are deductible. Even if your rental property is temporarily vacant, the expenses are still deductible while the property is vacant and held out for rent.
Deductible expenses include, but are not limited to:
- Homeowner association dues and condo fees
- Insurance premiums
- Rents you paid to others
- Yard maintenance
All expenses you deduct must be ordinary and necessary, and not extravagant. You can deduct the cost of travel to your rental property, if the primary purpose of the trip is to check on the property or perform tasks related to renting the property. If you mix business with pleasure, though, you’re required to allocate the travel costs between deductible business expenses and nondeductible personal costs. Be careful not to cheat yourself on the breakdown.
Consider this example:
John, who lives in North Carolina and loves to ski, owns a rental condo in Park City, Utah, which he visits each January to get the place ready for that season’s tenants. His travel expenses are deductible if, for example, the primary purpose of his trip is to clean and paint the unit. Let’s say that during a five-day visit to the condo, John spends three days cleaning and painting and two days skiing.
Keep good records. To deduct any expense, you must be able to document the write-off. So hold on to all receipts, cancelled checks and bank statements.