An article by Lisa Pentland (NSW)

Many Property Managers and business owners struggle with the idea of charging their landlords to provide them with an annual income and expenditure report. However, with the fierce competition on fees, I see this as a brilliant opportunity to really set yourself apart from your competitors as " industry experts, worth paying that little bit extra for".

My on the ground and more recent mystery shopping experiences tell me that your competitors are most likely to either not have the conversation about income & expenditure reports or dismiss it with "We don't charge for that, we just push a button and the software does it all". Well, indeed, if that is all they think is involved, quite rightly they shouldn't charge for it!
Property investors need you in their corner for "2" things you should have that they don't, skills and knowledge.

When it comes to the handling of their annual income and expenditure report they are:

Skill:
-   Pushing a button (as it has broadly been defined by our industry)

Perceived value to client:
-   Little or none (Understandably)

Most of you will be familiar with the saying "garbage in - garbage out" and when it comes to data entry, even the most advanced trust accounting programs rely on quality data in.

Knowledge:
So when it comes to the knowledge, how valuable are you? Do you know your stuff? Are you worth paying more for? Will your landlords expenses be correctly entered and coded? Will they really save accounting fees as a result of the report you provide them? Are you doing the job landlords can reasonably expect of you or are they getting what they paid for - nothing?

If you can answer yes to all of the following, your knowledge and commitment to excellence has a real value and provides a genuine advantage to your landlords. Take pride in your work and charge your fees accordingly:
• You have completed formal trust account training
• You continue to attend regular trust account training with your software provider (particularly as updates occur)
• You have customised your software chart of accounts and have a thorough understanding of how to manage and explain it to your landlords if required
• You have saved the correct codes against your regular tradies and expenses
• You know the difference between an immediate deduction and a capital works deduction and code them appropriately every time (this may require a conversation with your landlord or their accountant to correctly qualify the expense)
• You understand the term "effective life" and know where and how to reference it
• You understand the times during the property investment cycle that expenses and capital works can and cannot be claimed
• You are familiar and regularly refer to the following site / document; https://www.ato.gov.au/uploadedFiles/Content/MEI/downloads/ind39784n17290614.pdf
• You share the above link / document with new landlords and or with existing landlords as part of your end of financial year service
• You have a 3rd party double check your landlords disbursements every end of month
• You request your auditor / accountant review your landlords chart of accounts and your practices annually
• You have someone with greater knowledge to refer to if you get stumped

Real value to client:
-   High

A commitment to continued learning and development costs time and money, but if you're going to charge it's essential that you have the knowledge and skills to perform. Equally important are the skills to confidently market and sell this service. When you've got it, the combination should not only increase your fees and conversion rates, it should win you raving fans and clients for life!

Tip - The fee for an income and expenditure report qualifies as an immediate deduction so charge it before 30 June and your landlords can claim it straight away!!!