How do i treat a paypal fee in QB when we have received payment for an invoice minus the fee amount?

This is great, thanks so much!!

Am I missing something or does this video make out that QB does all of this automatically?

https://quickbooks.intuit.com/app/apps/appdetails/paymentswpaypal/en-gb/

Ive spoken numerous time to QB support and they all give long winded versions like above but the video makes it all sound amazingly easy yet its harder work than invoicing in PayPal and just entering a sales receipt

Yup, this is stupid. Much easier to disconnect the PayPal bank account and manually reconcile than this long-winded workaround. Come on QB, this is clearly a feature that needs to be fixed! 

This is rediculous..

I should be able to match a deposit on the PayPal Bank to an invoice and it automatically add the fees but it doesn't. Infact I can't even see the paypal fees listed anywhere in qb.

This needs to be resolved ASAP otherwise I might as well just use stripe or another 3rd party payment gateway and save myseld a few bob.

It doesn't seem to matter what I do I can't get the deposit to "match" on the paypal bank feed.

@mdj101 

You may have 2 options using a paid app as a workaround.

I'm not using a paid app as a work around. That's rediculous.

Hello mdj101, thanks for commenting on this thread so you should be able to match the deposit to the banking transaction. in your Quickbooks account. 

You can add to the bank deposit (underpositied funds) and minus the PayPal fees. Put the date of the bank deposit this should match at the bank but you have to make sure the undeposited  amount has the correct bank showing for it to show as a match. When in the banking screen if it doesnt show up as a match then you will need to click into it and click find match and it should bring the deposit up for you to select. 

OK.

I think I've now got this working and showing the transaction on the PayPal Bank feed.

!! IMPORTANT !! - Ensure the date payment is received and the dates of the deposits ect all MATCH.

1. On the invoice, click the Receive Payment button.
2. Select the correct invoice on the Receive Payment screen.
3. In the Deposit to field, choose Undeposited Funds.
4. Click Save and close. 

Then

1. Click the QuickBooks NEW / Plus (+) icon.
2. Select Bank Deposit.
3. Mark the invoice payment you received previously from the Select the payments included in this deposit section.
4. Expand the Add funds to this deposit section to add a new line item.
5. In the Received From column, select PayPal as the vendor who charged the fees. (I think this is the important bit)
6. In the Account column, add an expense account for the fee (I use bank charges)
7. In the Amount field, enter a negative fee amount.
8. Make sure the deposit matches the net bank deposit amount.
9. Click Save and close.

Now when you open the PayPal bank feed, it should show as an option to MATCH against the payment.

Shouldnt have to though its actively marketed by QB as a feature! Why market a feature that doesnt work? Essentially it is being missold but this is the tip of the iceberg. If it wasnt such a hassle I would be looking at other software as there are so many issues that they know about and are "working on" its crazy. Google any issue you have and its almost guaranteed they will "pass it on to the development team".

For this issue...

You have to find the payment in the PayPal bank feed

Click on it then click "find match"

Select the invoice (which will actually show as Type: Payment, not an invoice so again wrong)

Then click the Resolve button

Enter...

Payee: PayPal

Category: PayPal Fees

Amount: The fee total (shown near the Resolve button) as a costs so -3.20 NOT 3.20

VAT: Exempt (Purchases)

Click 'Save'

At least thats how I am doing it and if my books are wrong I know where Im advising the Tax man goes as this is a MTD authorised piece of kit but its not doing what they say it does so I do it the best way I have worked out.

I looked at using the resolve button but when you enter a negative amount it doesn't seem to add up.

I do remember thinking that myself but it does do it correctly when you look, just done one now.

If you enter a positive fee amount the difference becomes twice the fee total because essentially if you have say a £3 fee thats missing from the invoice amount and you enter a positive "fee" amount like £3 this appears to be more income not expense, so the difference is now double.

If you enter -3.00 it will resolve to the correct total. Presuming the invoice was £100 and the fee was £3 in this instance.

Just make sure the rest of the fields are as mentioned above but this is much quicker and easier than the other method posted above which does seem to get suggested a lot but if I had to do it that way I would just invoice in Paypal directly and enter them as sales receipts when I do an upload. Keeping a monthly/quarterly sum of my paypal fees to enter at some point as an expense.

Not displaying matches in Banking using this method. Nor is a 'Workaround' a solution.

Hi Josnoddy, did you create the bank deposit with the details outlined in the first response? As long as the bank account, date, and final amount match on here, this should then show a match to your bank record. 🧐

I'm on quickbooks desktop US version. Signed up for quickbooks online UK thinking things are more automated. But they actually arent. So much of it is manual based. Even if you connect your paypal account, all sales go to undeposited, and you have to manually one by one deposit them and place in the fees. When it comes to refunds and partial discounts etc things get a little cray cray. I dont understand how this software especially the online one isnt way more automated, Quickbooks been around since 2010 right? and youre still chasing paypal to give you details that they wont let you have... I dont even know what that signals. 

Hi mdj101, 

Although your thread was posted quite sometime back, this Paypal Fee issue is still unresolved. The QBO customer service team did not offer any valid help.

QBO extract the gross amount for Paypal.

Steps worked for me:

1. Banking tab -> Paypal -> Match the gross amount with the invoice

2. Extract transaction fee from Paypal Statement -> book them via journal entries.

Hope this helps!

Lil