Running a guest house means wearing many hats — host, marketer, handyman…and sometimes accountant too! One area that often causes confusion is understanding what really happens “behind the scenes” of your booking payments. Let’s break it down in simple terms with some real-world examples, so you can manage your finances more confidently when accounting for your guest house, B&B, boutique hotel, or apartment.
Booking payments and why it matters for your accounting
Two sides of every business (AR and AP)
In business, there are always two types of partners you deal with:
- Accounts Payable (AP) — also called Creditors. These are the people or companies you owe money to. Example: You buy new bedding from a supplier. Until you’ve paid their invoice, they’re sitting in your Accounts Payable.
- Accounts Receivable (AR) — also called Debtors. These are the people who owe you money. Example: A guest books a room with you — they now owe you for the stay, which means they’re part of your Accounts Receivable.
How this normally works in a shop
Think about a small hardware shop:
- The shop buys a hammer from a supplier (AP).
- Later, a customer buys that hammer (AR).
- You’d see two separate movements in the shop’s bank account: money going out to pay the supplier, and money coming in from the customer.
What Makes Accommodation Accounting Different
Here’s where accommodation providers are unique: with online bookings and channels like Booking.com or Airbnb, the two flows (money in from guests, money out to the channel as commission) happen at the same time.
Imagine this:
- A guest books a room for R1,000.
- The channel (say Booking.com) takes their 10% commission (R100) right away.
- What you actually see in your bank account is R900.
One payment in the bank, but actually two transactions in the background:
- R1,000 owed to you (Accounts Receivable from the guest).
- R100 owed to the channel (Accounts Payable commission).
Where Guest Houses Often Slip Up
Here’s the mistake many small properties make: they see the R900 in the bank and record that as their turnover. Simple, right?
Well, sort of. That works if you’re using a cash-based system — basically treating your bank balance as your sales figure. But if you’re VAT-registered, things get more complicated.
In that case, you must:
- Raise an invoice for the full R1,000 + VAT for the guest.
- Record the R100 + VAT commission from the channel as a separate expense.
- Reconcile the fact that the cash you received (R900) is the net result of both transactions.
Why Reconciliation is Tricky (But Important)
The headache is reconciliation — showing exactly how that R900 payment is made up of the R1,000 guest booking minus the R100 commission.
Think of it like baking a cake: the guest pays for the whole cake (R1,000), the channel takes their slice (R100), and you’re left with the rest (R900). Together, your books need to reflect all three parts of the story — the full cake, the slice taken out, and what’s left on your plate.
Tools That Help with Guest House Accounting
- NightsBridge handles the guest invoice side (Accounts Receivable).
- Your accounting software (like Sage, Xero, or Pastel) is where you should capture the channel invoice (Accounts Payable).
- Your payment processor (eg: NightsBridge Pay) shows you how the money in your bank lines up with the invoice and commission, so you can reconcile properly.
The Takeaway for Guest House Owners
- Don’t just treat the money in your bank as your turnover — especially if you’re VAT registered.
- Always raise your full guest invoice, and don’t forget the channel’s commission invoice.
- Use your accounting system for the full picture, since your guest management system isn’t designed to handle Accounts Payable entries.
It may feel like extra admin work, but getting this right ensures your VAT is recorded correctly, your books stay accurate, and you avoid nasty surprises later on.