Record an aggregator RCTI in Xero as commission income, then match the bank deposit to that entry after accounting for documented deductions. The invoice-and-payment route below keeps the amount owed visible until settlement. Recording the deposit as another sale would count the same commission twice.
Start With the Brokerage as Supplier
Your brokerage is the supplier when it earns commission and the aggregator issues the recipient-created tax invoice (RCTI). The aggregator is the recipient of the brokerage’s services, even though your brokerage receives the document and cash.
Xero’s RCTI creation procedure describes the payer’s purchase order and bill. Those records belong to the party paying its supplier. Your brokerage records its own commission through a sales record.
Before posting, have these inputs ready:
- Access to create and approve sales invoices, bills and credit notes, plus permission to reconcile the receiving bank account.
- The brokerage’s confirmed GST registration and cash or non-cash GST accounting basis, with matching Xero financial settings.
- The issued RCTI and its loan-level commission statement, checked against the brokerage’s identity and the issuer’s reference.
- The separate fee invoice and any adjustment document explaining deductions.
- The bank statement line or payment advice identifying the receipt and any split payments.
Use the RCTI and commission statement guide to resolve document problems and establish the commission-to-cash calculation first. Enter the supported amounts into Xero once that calculation is clear.
The ATO’s GST attribution rules distinguish cash from non-cash accounting. Cash-basis GST generally follows payment to the extent paid. Non-cash GST on a taxable supply generally follows the earlier of an invoice being issued or any payment received. Recording the earning period for trail analysis does not set the GST reporting period.
Choose One Posting Route
Use a sales invoice to record the RCTI when you need a separate receivable and a clear record of its settlement. Keep the aggregator-issued document attached as the source. The Xero invoice is an internal accounting record, so do not send it as a second tax invoice or payment demand.
Xero also documents a receive money route for cash transactions during bank reconciliation. That route records the receipt directly without a separate sales invoice. It suits a receipt whose income has not already been entered and whose full accounting breakdown is supported. Use it only when receipt-date recognition fits the brokerage’s accounting method. A net deposit still needs its deductions recorded separately under the chosen method.
This example uses the invoice route because the gross commission, clawback and fee each have their own source document. The commission invoice records income. Matching the bank receipt settles that record.
Correct: enter the commission invoice once, then match the deposit to the invoice and documented deductions. Incorrect: after entering the invoice, a user also codes the deposit to commission income through Create or a receive money bank rule.
Record Commission, Fees and Adjustments
Enter each source document as its own Xero record so a smaller deposit does not hide gross commission or fees. The following hypothetical example uses the accounting treatment from the statement guide. Assume the brokerage is GST-registered and every illustrated supply is taxable at 10%. The fee qualifies for a full GST credit, and the clawback document supports a reduction of earlier taxable commission.
Worked Commission Entry
| Source document | Before GST | GST | Total | Xero record |
|---|---|---|---|---|
| Commission RCTI R-101, upfront | $4,000 | $400 | $4,400 | Sales invoice income line |
| Commission RCTI R-101, trail | $2,000 | $200 | $2,200 | Same sales invoice, separate income line |
| Clawback adjustment A-101 | $500 | $50 | $550 | Sales credit note reducing commission |
| Fee invoice F-101 | $200 | $20 | $220 | Bill to the fee expense account |
| Payment advice and bank receipt | $5,830 | Net settlement to reconcile |
- Search Xero for R-101 before creating a record. Check the aggregator contact and amount as well as the reference. Reuse an existing record if the same RCTI has already been entered or imported.
- Create one sales invoice for the aggregator named on R-101. Retain Xero’s unique invoice number and put R-101 in the reference. Use the source document’s issue date and supported payment terms. Attach the RCTI and commission statement.
- Enter the $4,000 upfront and $2,000 trail as tax-exclusive lines. Select the brokerage’s existing upfront and trail income accounts, or its single commission income account. Use GST on Income for these assumed taxable supplies. Check $600 GST and a $6,600 invoice total before approval.
- Enter A-101 as a sales credit note for $500 plus $50 GST. Use the original commission income account and the supported sales tax treatment. Attach the adjustment document and identify the original commission reference. Keep the $550 credit available for this settlement, without also subtracting it from R-101’s income lines.
- Enter F-101 as a separate bill for $200 plus $20 GST. Select the aggregator-fee expense account and GST on Expenses for this assumed creditable purchase. Attach F-101 and retain its reference. Leave the bill available for matching against the net settlement.
Xero’s Australian default tax rates include GST on Income and GST on Expenses at 10%. Select the treatment supported by each document. A fee, GST-free supply or different adjustment must not inherit the commission line’s tax code automatically.
A clawback credit note records the documented change to commission. It does not authorise the brokerage to issue a replacement RCTI. Keep the aggregator’s adjustment document as the tax evidence. If the current RCTI already includes the same clawback reduction, record that reduction once and omit a second credit.
Match the Net Deposit in Xero
Match the $5,830 deposit to the records that explain its net amount. The settlement calculation is $6,600 commission less the $550 credit and $220 fee bill.
- Open the receiving account under Accounting, Bank accounts. Open its Reconcile tab and locate the $5,830 statement line using the payment reference.
- Choose Find & Match and locate the relevant commission invoice. Include the unpaid clawback credit and fee bill in the settlement selection. Display spent items where needed to locate the deduction. Confirm that the selected records total $5,830 before reconciling.
- Reconcile the statement line once the selected total matches. Open the reconciliation details to confirm which records it settled. Retain the payment advice with the settlement references.
Xero supports matching credit notes with invoices or bills so their net total matches a statement line. Keep the fee as its documented expense. A generic bank-fee adjustment or rounding entry must not absorb an unexplained commission difference.
For split receipts, apply each actual part payment to the same outstanding invoice through the matching process. Include only the deductions settled in that payment. After the first receipt, the remaining invoice balance must equal the amount still owed under the payment advice. Match the next receipt to that balance without creating another sale.
The checkpoint is one matched bank line for this receipt, one commission income record and a source document for every deduction. A fully settled run leaves no unpaid balance on the included invoice, credit or fee bill.
Check the Posting and Resolve Differences
Compare Xero’s account transactions with the RCTI and settlement documents before treating the payment run as complete. For the hypothetical example, use the same reporting basis and inspect these results:
| Check | Expected result |
|---|---|
| Commission income before the clawback | $6,000 |
| Documented commission reduction | $500 |
| Commission income after the clawback | $5,500 |
| Fee expense | $200 |
| Sales GST after the adjustment | $550, from $600 less $50 |
| Fee GST credit | $20 |
| Net GST effect of these records | $530 |
| Actual bank receipt | $5,830 |
| Remaining balances for the settled documents | $0 |
These are transaction checks. The GST reconciliation guide covers the separate period-end comparison with the business activity statement (BAS).
Resolve Posting Differences
| Symptom | Record to inspect | Corrective route |
|---|---|---|
| Revenue includes both $6,000 and the deposit | Commission invoice and the bank line’s receive money record | Preserve the source invoice. Retain the duplicate’s details and use Xero’s Remove & Redo for the erroneous bank-created transaction, then match the released statement line to the existing records. |
| The deposit has no suggested match | Invoice approval status, payment allocation and deduction records | Search through Find & Match. Include the supported deductions or apply the actual part payment. Leave an unexplained shortfall outstanding. |
| The right amount paid the wrong invoice | Bank line’s reconciliation details | Unreconcile the incorrect match, then reconcile to the correct records. |
| The aggregator replaces or changes an RCTI | Original attachment, revised source document and linked credit or payment | Keep both source versions. Correct the internal record or enter the documented adjustment, with a note explaining the change. |
| GST differs from the documents | Tax-inclusive setting, line tax rates and credit note | Correct the identified input using the source document, then recheck the transaction’s GST. |
Xero’s Australian transaction-edit guidance explains Remove & Redo when a bank transaction’s total needs changing. Use that correction for an erroneous accounting transaction, while keeping the imported bank statement line and supporting evidence.
For an invoice already paid, Xero limits which fields can be edited without removing its payment. Preserve the original documents and use the record’s History & Notes to explain the correction. A locked period or a correction affecting a lodged BAS needs the brokerage’s accountant before records change. Once corrected, reopen the bank match and confirm the remaining balance against the payment advice.
