Recording the commission booking sites charge
How a guesthouse or hotel records booking-site commission as a cost, captures each commission invoice as a bill, and handles commission taken from payouts.
By Achekam · · 5 min read · For Hospitality businesses in South Africa, Nigeria, Kenya
For many guesthouses and small hotels, the booking sites bring in many of the guests, and they take a commission on every stay. Some send an invoice for the month's commission and expect it to be paid. Others collect the guest's money themselves and pay the property out after deducting their cut. Either way, the property's books need to show two things clearly: what the rooms actually earned, and what it cost to sell them.
Get this wrong and the books mislead quietly. Treating the net payout as room income makes revenue look smaller and hides the commission entirely, so the owner never sees how much distribution costs. This article explains how to record commission properly in Achekam, whichever way the booking site charges it.
Commission is a cost, not lower room income
A guest who books through a site pays for a room at the rate the site displayed. That full rate is what the room earned. The commission is a separate cost of selling the room, like a travel agent's commission or a card fee.
Keep them apart in the books:
- Room revenue at the full rate the guest paid.
- Commission as an expense, in an account of its own.
The chart of accounts can take that: accounts can be added, renamed or switched off, so create an expense account such as "Booking site commission" if your chart does not have one. When the owner opens the management accounts, which show an income statement for a chosen period beside the period before, commission then appears as its own line, and it is easy to see whether it is growing faster than room revenue.
The booking site as a supplier
Each booking site is a supplier. A business keeps one supplier list, with duplicate checks by name or VAT number, and quotations, orders and bills pick suppliers from it. Add each site once, under the name that appears on its invoices, and use that record every month.
One limit for Nigerian and Kenyan properties: at the time of writing, a supplier's VAT number must be in the South African format, so Nigerian and Kenyan VAT numbers are refused. Leave the field empty if the site's number will not save, and keep its invoices on file.
Capturing each commission invoice
Record each commission invoice as a supplier bill, line by line with VAT. A bill without a purchase order waits for approval before it posts, which gives the owner or manager a natural moment to glance at the month's commission before it hits the books.
VAT on the bill depends on where you are:
- South Africa. Supplier bills take 15% or 0% VAT per line, and bills post input VAT to the ledger. Use the VAT the site's invoice actually shows.
- Nigeria and Kenya. At the time of writing, supplier bills and purchase orders offer only 15% or 0% and default to 15%, so they do not use your own country's VAT rate. Check every line, and change the default wherever the site's invoice does not carry 15% VAT.
How VAT applies to commission charged by a site based outside your country is a question for your accountant; record what the invoice shows and ask before claiming any input VAT on it.
If you upload commission invoices to Financial Intake instead, know what that produces: an uploaded supplier invoice becomes a suggested posting, which a person approves and posts, not a bill on the Bills list waiting to be paid. Choose one route for commission and use it every month, so nothing is captured twice.
Paying it, or seeing it deducted from a payout
When the site invoices you
A bill can be paid in full or in parts from a chosen bank account. Paying a supplier only records the payment; no bank payment file is produced, so the transfer itself is made in your bank. When the payment appears on your bank statement, it is matched in the bank reconciliation: bank lines are matched by suggestion and a person accepts each match.
When the site deducts it from a payout
Here the bank shows only the net amount. The full room revenue and the full commission both still belong in the books; the payout is simply the difference arriving.
A worked example in words: a site collects a guest's payment for a weekend stay and pays the guesthouse out after deducting its commission. The guesthouse records the room revenue at the full rate the guest paid, owed by the booking site. It records the site's commission statement as a bill. When the net payout lands, the bank line clears the amount the site owed, and the commission bill is settled against it rather than paid in cash. Your accountant sets up that settlement with a manual journal; a manual journal must balance, and a posted one is corrected only by a reversal. A bank line that is not yet in the books becomes a suggested journal, which a person approves, so nothing posts on its own.
Agree the method with your accountant once, write it down, and follow it for every payout.
Checking commission against the stays
Booking sites make mistakes, and so do properties. Once a month, compare the site's commission statement with your own reservations:
- Every stay the site charged for actually took place.
- Cancelled bookings and no-shows were charged only as your agreement with the site allows.
- The commission on each stay matches the rate in your agreement.
- Any stay booked directly by a returning guest was not charged as a site booking.
Query differences with the site promptly, because sites often set a time limit for disputes. ACCA's article on supplier statement reconciliations explains why a separate record of each credit supplier is kept and how reconciling supplier statements to it finds errors.
Commission is one bill among many for a property; food and beverage supplier bills covers the kitchen side. In quiet months the commission still falls due on the stays that came in, which is worth building into cash planning for the low season.
Record the full room rate, book the commission as a cost from its own invoice, and reconcile the site's statement to your stays every month. The books will then tell you what your rooms earn and what it costs to sell them.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
