Landlord Vision

Just wondering how to treat a deposit I paid to acquire a house from a landlord allowing me to sublet it out!
Is this deposit an Asset as is held till lease termination/expiration? Also how do I enter monthly rent I will be paying the landlord?

1. With regards to your deposit for sub-letting a property, if the conditions are:
 
- Deposit will be refunded at the end of the contract, or
- the deposit will be adjusted with the last month’s rent
 
Then you should record it as an Asset. Please set up you asset account as follows:
 
Settings => Chart of Accounts => Add Account => Account Type = Asset > Account Name = Security Deposits
 
Under Account Manager => Journals record the following journal transaction:
Debit: Security Deposits
Credit: Bank/Cash Account
 
2. Monthly Rent
It's an expense for you so please create the expense account 'Rent - Expenses (Property ...)' in your Chart of Accounts. Under Property Manager => Expenses please record the rent transactions.
 
3.Finally, when the landlord returns the deposit to you, please enter the following Journal entries:
 
Debit: Bank/Cash Account
Credit: Security Deposits
 
In case a partial amount of the deposit is used for the last month's rent and then the deposit remainder is returned to you the transactions would be as below:
 
Example:
 
Deposit: £1,000
Rent: £700 per month
 
Say that when the last rent is due, the you and your landlord agree that the rental amount will be deducted from the deposit amount and the landlord will return the deposit remainder. In this case, the following transactions should be posted:
 
1) Deposit amount used to pay for the rent
 
Debit: Rent - Expenses (Property ...) £700
Credit: Security Deposits £700
 
2) Deposit remainder returned to you
 
Debit: Bank/Cash Account £300
Credit: Security Deposits £300