How to Set Up Surcharges for Consolidated Tenant Billing Invoices

Adding Surcharges lets you combine recurring charges, such as utilities, taxes, parking, pet rent, or other fees, with a tenant's primary Rent or HOA charge. Instead of multiple separate charges posting to the tenant ledger, Rentec Direct creates a single consolidated invoice that includes each charge.

Once these Products & Services are created, they can be used as often as needed for multiple tenants.

What This Article Covers

This article covers the following topics; click on a link to jump to the section.

1. Add Products & Services 
2. Link surcharges to rent
3. Create multiple billing variations for different tenants for different tenant charge combinations
4. Frequently Asked Questions (FAQs)

Pro Tip: Before creating new Products & Services, check with your accountant for any preferred reference numbers or accounting classifications to keep your records consistent.

Before You Begin

A surcharge is any charge billed in addition to a tenant's primary rent or HOA dues. Common examples include:

• Utilities
• Pet rent
• Parking fees
• Storage fees
• Resident benefit packages
• Sales tax

Creating a combined billing with surcharges requires two steps:

1. Create Products & Services for the individual charges which will be used as surcharges
2. Link those Products & Services as surcharges to a primary Rent or HOA Product

If different tenants pay different combinations of recurring charges, you can create multiple Rent or HOA Products that include the appropriate surcharge combinations.

Step 1: Create Individual Products & Services (Surcharges)

First, create a Product & Service for each recurring fee you may charge tenants.

In your Rentec Direct account: 

1. Click Settings
2. Under Financial, select Products & Services
3. Click the +Add Product 
4. Enter a Description (for example: Utilities, Pet Fee, Sales Tax)
5. Select the appropriate Class (If the specific class isn't listed, use Other)
6. If your accounting provided you with a category to use, uncheck Auto Number; otherwise, leave it blank so the software can auto-generate it.
7. Save New Product

Repeat these steps for each surcharge you may apply to tenants during their rent cycle.

Step 2: Link Surcharges to Rent or HOA Product

After creating your surcharge Products & Services, you can easily link them to a primary Rent or HOA Product, so they post together on a single consolidated invoice.

Choose the setup that best fits your billing needs.

Option 1: All Tenants Receive the Same Surcharge

Use this option if all tenants receive the same recurring surcharge(s), such as Rent plus garbage.

In your Rentec Direct account: 

1. Click Settings
2. Under Financial, select Products & Services
3. Click +Add Product
4. Enter a Description (Rent + Garbage)
5. Select the appropriate Class (Most commonly Rent / HOA as this is the primary charge)
6. If your accounting provided you with a category to use, uncheck Auto Number; otherwise, leave it blank so the software can auto-generate it.
7. Click on +Add Surcharge
8. Select the surcharge created in the previous step
9. Enter the surcharge amount and whether it is Fixed or a Percent of the primary charge
10. Click Save Changes

Option 2: Tenants Have Different Billing Combinations

If tenants are billed different combinations of recurring charges, create separate Rent or HOA Products for each billing variation.

For example:

• Rent + Garbage
• Rent + Garbage + Pet Fee
• Rent + Storage

This allows you to select the appropriate Product when moving in a tenant or posting charges.

In your Rentec Direct account:

1. Click Settings
2. Under Financial, select Products & Services
3. Click +Add Product
4. Enter a Description (example: Rent + garbage + pet fee)
5. Use the dropdown to select a Class for the monthly primary charge (Rent or HOA)
6. If your accounting provided you with a category to use, uncheck Auto Number; otherwise, leave it blank so the software can auto-generate it.
7. Click +Add Surcharge, then select the surcharges (repeat as needed)
8. Save New Product

Going forward, when moving in a tenant or posting charges, select the Product & Service that matches the tenant's billing arrangement.

Frequently Asked Questions (FAQ's)

Q) What is the benefit of invoice billing?

• Allows all monthly charges to post at the same time on one invoice  
• Simplifies compliance with itemized charge requirements
• Consolidates and notifies the tenant of all charges, such as storage, parking, pet fees, and any additional services you'd like to post to a tenant invoice/ledger, on or before the due date, based on your system settings. 
• Automatically numbers invoices

Q) Does this work for commercial billing?

• Yes, for tenants of commercial properties, or those with Common Area Maintenance (CAM) or Ratio Utility Billing System (RUBS) charges, these charges will be set up as surcharges and then applied as CAM to individual tenants for invoicing. Learn more: Common Area Maintenance | CAM Charges