6300expenseNormal balance: Debitbusiness6300 — Rent
Rent covers what a business pays for space it occupies but does not own — an office or shop lease, a coworking membership, a storage unit for inventory or equipment. If the business is paying regularly to use space that belongs to someone else, that payment generally belongs here.
As an expense, it carries a normal debit balance. A mortgage payment on space the business actually owns is a fundamentally different kind of transaction — principal reduces a loan liability, interest is a separate expense, and neither works the way a straightforward lease payment does, so the two should never be blended into the same account.
A home-office situation, where the owner works from a personal residence, is its own separate calculation entirely — typically a portion of actual home costs figured a specific way, rather than a simple rent-style expense, and it is worth confirming the right approach with an accountant since it often falls outside what this simplified chart is built to handle directly.
What belongs here
- office, shop, or warehouse lease payments
- coworking space fees
- storage unit rent for business inventory or equipment
- equipment or vehicle lease payments, if the business tracks those here rather than a separate line
What does not belong here
- a mortgage payment on business-owned space — principal reduces a loan liability and interest is a separate expense, an entirely different structure than rent
- a home-office allocation for an owner working from a personal residence — calculated differently, often outside this simple chart's scope; ask an accountant
- a refundable security deposit — arguably Prepaid Expenses (1400) or its own asset, since it is not an immediate expense at all
Where it shows up
Shows on the income statement as an operating expense. On Schedule C, this maps to line 20 for real property; vehicle or equipment leases have their own sub-line the business may want to split out separately.
Common questions
- Does a mortgage payment belong in Rent?
- No — a mortgage is debt, not rent. The principal reduces a loan liability and the interest is a separate expense; neither works like a lease payment.
- What about working from home?
- A home-office deduction is calculated differently than a normal rent payment and often falls outside what this simple chart handles directly — worth confirming the right approach with an accountant.