I shifted to Delhi in 2019 and was asked to pay three months' rent in advance. I did not quite like the idea, but since I was unable to find a good place apart from it, I agreed to pay for it. My rent was Rs 14,000, so I gave Rs 14,000 plus Rs 42,000, a total of Rs 54,000 that month. I did not know at that time how to calculate one month rent paid in advance, so I asked my colleagues about it. In India, no one follows any rules for advance rent. They just ask for a particular amount or three to six months’ rent in advance.
Pay your rent through credit card online using NoBroker Rent Payment services Get your legally verified rent agreement delivered to you within a day by NoBrokerHow do I account for rent paid in advance?
Before making any advance payment, make sure you record everything in a document. This rent paid in advance is like an asset. Let me explain its meaning with an example. Suppose you have rented a place for Rs 1 lakh, and the rent to be paid per month is Rs 20,000. So if you have paid the current month’s rent and also four months’ rent in advance. The extra, i.e., Rs 80,000, will be considered an asset. You can use this money to pay the next four months' rent or use it during a crisis (you can use it to pay the rent only in this case).
The basic formula to know
One month's rent paid in advance is = Weekly rental divided by 7 (days) x 365 (days) divided by 12 (months)
You can use this formula to know how to calculate one month rent paid in advance.
Read More:How Many Months Rent in Advance is to be Paid?
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How to Calculate One Month Rent Paid in Advance?
Shiva
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2 Year
2023-04-05T10:57:18+00:00 2023-04-17T23:34:35+00:00Comment
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