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Trust Account vs Disbursement Account?

Discussion in 'Accounting & Tax' started by fullylucky, 4th Sep, 2016.

  1. fullylucky

    fullylucky Well-Known Member

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    What's the difference between Trust Account vs Disbursement Account?

    If you are managing a townhouse complex or appartment, tenants pay their rent to you to the Trust account, at the end of the month when you pay the owners their amount after taking away all the commissions (+ gst) and expenses (+ gst) and payments admin and gardening fee etc don't you also do that out of the Trust account?
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    All payments from tenants to owners via an agent must be made to the statutory trust account (an account that only an agent can open). Commission is also paid from the trust account to the agency's working account.
     
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  3. D.T.

    D.T. Adelaide Property Manager Business Member

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    No such thing as a disbursement account.

    Rents go into trust account. Commission and landlord's bills come out of it.

    When doing the disbursement, commission goes to the agent's operating account, bills go to their payees and rents go to their landlords.
     
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  4. fullylucky

    fullylucky Well-Known Member

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    What does working account mean?

    Does that just mean their own personal account?
     
  5. fullylucky

    fullylucky Well-Known Member

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    What does agent's operating account mean? is it their personal bank account?
     
  6. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    A business will operate banks accounts to receive income and to pay bills.

    But certain businesses such as estate agents hold money belonging to others. This is trust money and must be held in a trust account until certain conditions are met. It can then be transferred to the relevant people - which may be the landlord and also the agent itself so the agent would transfer it from the trust account to their 'working account' which they can use without trust restrictions.
     
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