A developer who sells plots or apartments on instalments is running two businesses: building, and lending. The building side has costs and budgets. The lending side has a customer who owes a large amount, to be paid over years, and the accounts must follow every instalment. Done in a notebook, it fails: payments are recorded but nobody knows who is overdue. This guide explains how to account for plot and unit bookings properly.
What happens in a booking
A typical booking has these parts:
- The customer buying the plot or unit.
- The site and the unit being sold.
- The total price.
- An advance paid at booking.
- A number of instalments for the balance.
The balance is the total price less the advance, divided across the instalments.
A worked example
| Item | Amount (Rs) |
|---|---|
| Total price | 6,000,000 |
| Advance paid at booking | 1,200,000 |
| Balance to be paid | 4,800,000 |
| Number of instalments | 48 |
| Each instalment | 100,000 |
If the balance does not divide evenly, the last instalment takes the small remainder, so the schedule always adds up to exactly the balance owed.
What to record, and where
- The sale. A sales invoice for the full price against the customer. This puts the customer's receivable on the books.
- The advance. A receipt against that invoice, into the bank or cash account that received it.
- The schedule. A list of instalments with due dates. The schedule is a tracking tool: it does not post accounts by itself.
- Each later payment. A receipt against the invoice, which reduces the customer's balance.
Your accountant decides when revenue is recognised on a sale of this kind, because that depends on your agreements and the standards you follow. Ask them before you set the process up.
What you need to see at any time
- Each booking's balance still to collect.
- Which instalments are overdue, and by how many days.
- Total receivable across all bookings.
- Active and cancelled bookings, so the receivable is not overstated.
Common mistakes
- Tracking instalments only in a spreadsheet. The accounts and the schedule then disagree.
- Recording the advance without a customer link. Later you cannot see who paid what.
- Ignoring the rounding remainder. The schedule then does not add up to the balance.
- Mixing cancelled bookings with active ones.
- No one owns collection. Overdue instalments should have a named follow-up person.
How OneAccounts does it
Units and plots are set up like products, grouped by site. To make a booking, choose the customer, the site and the unit, and enter the total price, the advance, the number of instalments and the date. OneAccounts then:
- Raises the sales invoice for the full price.
- Records the advance as a receipt into the bank account you choose.
- Creates the instalment schedule, with the last instalment absorbing any rounding remainder.
The bookings list shows each booking's balance and status, with active and cancelled bookings marked, and a total outstanding. Payments are recorded on a separate screen. See instalment collection: applying payments and chasing overdue and Construction accounting software.
Frequently asked questions
How many instalments can I set?
You enter the number for each booking. A common plan runs for several years, and the default in the form is 60.
Does the schedule change the accounts?
No. The invoice and the receipts post the accounts. The schedule tracks what is due and what has been paid.
What if the customer pays an extra amount?
Enter the amount received. It is applied to the oldest unpaid instalments first, and the balance reduces accordingly.
Can I see who is overdue?
Yes. Overdue instalments are marked on the booking's schedule, and the bookings list shows each balance.
Can I sell several units to one customer?
Yes. Each unit is a separate booking, so each has its own schedule and balance.