⚠️ Disclaimer:
The information in this article is provided as a general guide and may be subject to change. Tax laws differ across regions and can vary depending on your business structure.
You should always consult a qualified accountant or tax advisor — or refer to the latest government resources — before applying tax settings in Rex PM.
Rex PM allows you to assign tax types to your financial transactions to ensure accuracy in your accounting and compliance with local tax laws.
Each transaction — whether it’s rent, fees, maintenance costs, or supplier payments — must be recorded under the correct tax type. This determines how (or if) VAT or GST is applied to that transaction.
In both the UK and Australia, there are three common tax types used in Rex PM:
- VAT / GST
- VAT / GST Free
- Out of Scope
1. VAT / GST (Taxable Transactions)
What It Means
This applies when goods or services are subject to tax — meaning VAT (in the UK) or GST (in Australia) should be charged and reported.
When you select this tax type, Rex PM calculates the applicable tax amount automatically and includes it in your reporting.
Examples – UK
A letting agent charging management fees to landlords (typically VAT applies at 20%) A supplier invoice from a cleaning or maintenance company that includes VAT Professional service fees such as photography, floorplans, or EPC certificates
Examples – Australia
A property management agency charging management or letting fees (typically 10% GST applies) A maintenance invoice from a contractor that includes GST Advertising or marketing expenses for a rental property that include GST
2. VAT / GST Free (Non-Taxable but Reportable Transactions)
What It Means
This applies when a transaction is not subject to VAT or GST, but still needs to be reported — meaning the transaction itself is valid for accounting, just not taxable.
These are typically essential goods or services that are exempt from tax under law.
Examples – UK
Residential rent paid by tenants (rent on residential property is exempt from VAT) Insurance premiums or insurance-related charges Certain financial or legal services that fall under VAT exemptions
Examples – Australia
Residential rent payments (residential property rent is GST-free) Water rates or council rates paid on behalf of a landlord Insurance premiums (generally GST-free when acting as an intermediary)
3. Out of Scope (Non-Reportable Transactions)
What It Means
“Out of Scope” applies when a transaction falls outside the VAT or GST system altogether — meaning it’s not taxable and not reported on your tax return.
These are typically internal transfers, trust movements, or transactions that don’t involve the exchange of goods or services.
Examples – UK
Transferring funds between landlord and tenant ledgers within trust accounting Refunding a tenant’s deposit (no VAT involved) Depositing money into or withdrawing money from the trust account
Examples – Australia
Bond payments or refunds (not subject to GST) Owner contributions or internal fund transfers within the trust Bank transfers between internal ledgers (e.g. moving money between maintenance and rent accounts)
Summary
VAT / GST
Apply when the transaction involves a taxable good or service.
Typical uses:
- Management or letting fees
- Maintenance or contractor invoices
- Advertising and marketing costs
VAT / GST Free
Apply when the transaction is a legitimate business activity but exempt from VAT or GST.
Typical uses:
- Residential rent
- Insurance payments
- Council or water rates
Out of Scope
Apply when the transaction sits outside the VAT/GST system entirely and is not reported.
Typical uses:
- Tenant bond refunds Landlord or owner fund top-ups
Internal transfers between ledgers
Best Practices
- Confirm your local tax obligations — rates and exemptions differ by country and property type.
- Apply tax types consistently across your Chart of Accounts to prevent reporting errors.
- Seek professional advice when unsure about how a transaction should be treated for VAT or GST