Problems understanding how to integrate Paypal correctly

Clea B · ‎January 13, 2022

Hello,

I'm having problems understanding how to record Paypal transactions as a self employed person. I have a few direct debit PayPal payments that go out each month and for each one I have a debit and credit show up from Paypal- so I think it's effectively cancelling itself out, rather than recording it as an expense? Eg. it says I've paid £300 but then the next transaction shows I've been paid £300, when it should just be the payment out.

To confuse matters further, when I'm paying in dollars it's showing as a debit in dollars and a credit payment to me in pounds. Is the answer to just delete Paypal, as surely all the payments for PayPal should just show up through the bank account it's linked to?

I hope I've explained myself properly, I struggle with using the correct terminology and would really appreciate any help! Many thanks!

GeorgiaC · ‎January 14, 2022

Hi Clea B, yes if all transactions are transferred between your bank and PayPal and PayPal is not used as a holding account then you can remove the connection. :)

View solution in original post

GeorgiaC · ‎January 13, 2022

Hi Clea B, if you transfer all funds to and from your PayPal via your bank then there's no need to have this connected, can we check if you're using our QuickBooks Online or QuickBooks Self-Employed plan? The PayPal connection should download any outgoing transaction as a single debit and income as a credit with separate entries for the gross amount and fee amount (with the fee showing as a debit).

Clea B · ‎January 13, 2022

I'm on the Self Employed plan.

I've attached an example of what the problem is.

Many thanks for your help

Ashleigh1 · ‎January 14, 2022

Hello Clea B, thanks for coming back to us, So it is like what Georgia has had. the 27 out is you transfering the money to your bank account so you either mark it as transfer or just connect your bank and record the amount as business income when it comes in and record any fees separately. so if you receive 27 into paypal the 27 out is your amount going to your bank so if you want to record in quickbooks the paypal you would do as business income for one and then transfer for the other.

Clea B · ‎January 14, 2022

So just to check, you are suggesting deactivate the connection to PayPal?

GeorgiaC · ‎January 14, 2022

Hi Clea B, yes if all transactions are transferred between your bank and PayPal and PayPal is not used as a holding account then you can remove the connection. :)

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Problems understanding how to integrate Paypal correctly