How to Calculate Prorated Rent

How to Calculate Prorated Rent
Understanding prorated rent calculations is key to good accounting.

Prorating Per Days in the Month

Landlords may choose to prorate rent based on the exact number of days in the the month. This method takes into account the varying lengths of the different months. As an example, say a rental term officially begins on January 10 and the monthly rent is $1,200. Divide the monthly rent by the number of days in the month -- 31 -- to get the "per diem," or daily rental rate. Multiply per diem by the number of days in the month the tenant has possession -- January 10 through January 31 -- or 21 days. The formula, ( $1,200 / 31 ) * 21, results in a prorated rent amount of $812.90.

Prorating Based on Days in a Year

Calculating rent based on 365 days in a year is the most accurate method for determining prorated rent on one-year leases, according to Landlordology, a resource website for landlords. It consists of multiplying the monthly rent amount by 12 -- the number of months in a year -- and dividing by 365. The resulting figure multiplied by the number of days the tenant has possession equals the prorated rent amount. For example, the formula for a $1,200 rent and a January 10 move-in is ( ( $1,200 12 ) / 365 ) 21, and the prorated rent is $828.49.

Using 30 Days as Basis

Landlords may opt for the 30-days rule-of-thumb, rather than using the precise number of days in a given month or the 365 days of a year. Although February has 28 days -- 29 on leap years -- and most months have 31 days, you can use 30 days to calculate prorated rent for any month. To calculate the rent due for a partial month, simply divide the rent amount by 30, then multiply by the number of days of days the tenant has possession of the rental. A January 10 move-in date for a $1,200 rental would then result in a prorated rent amount of $840.

Dealing With the Differences

Tenants should understand the basic method of calculating prorated rent, regardless of the specific method a landlord uses. A method may work more or less in favor of the landlord or tenant, depending on the dates. For example, if the move-in month has 31 days, using the number of days in a year yields a slightly higher rent payment for the landlord. In February and months with 30 days, prorating by the number of days in the month yields a higher rental payment.