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A
AliN
February 23, 2018
Solved

PayPal Fees

  • February 23, 2018
  • 53 replies
  • 70 views

Hello,

 

I have a question about PayPal Fees and how to record them properly.

 

Here my question and workflow:

 

 

  1. Customer calls and places an order (invoice) or places an order directly via online store (bigcommerce). For an item that cost $100.00. (Example)

 

  1. I or BigCommerce record this sale with the customers full set of details, Invoice for manual order, sales receipt for bigcommerce automation.

 

  1. Customer pays via PayPal Invoice or Automatically during BigCommerce PayPal Express checkout.

 

  1. We login to PayPal and see that we have $97 per transaction (-$3 less PayPal fee) and transfer the funds over to the bank on a per transaction basis.

 

  1. 2-3 days later our bank shows each fund has been recieved and quickbooks online syncs the payments for $97.

 

 

6. Recording the PayPal Fee per Transaction is the issue, how do you match these amount to the Invoice or Sales receipt and account for the PayPal fees in Quickbooks online? I've seen others with the same question but i don't believe the solutions provided are uptodate and or the appropriate way of accounting for the fees.

      Best answer by john-pero

      Does not matter if it is QB online ir desktop, the procedure is exactly same, correct and up to date.

      1. Sell item for $100

      2. Record received payment of $100 posted to Undeposited Funds

      3. Create deposit selecting the $100 item (or all that are in one deposit as is case with Square)

      4. Add line item negative processing fee for $3

      5. Save net deposit of $97

      6. Accept green match

      Works every time AND IS proper and accepted accounting

      53 replies

      john-pero
      john-peroAnswer
      Level 12
      February 24, 2018

      Does not matter if it is QB online ir desktop, the procedure is exactly same, correct and up to date.

      1. Sell item for $100

      2. Record received payment of $100 posted to Undeposited Funds

      3. Create deposit selecting the $100 item (or all that are in one deposit as is case with Square)

      4. Add line item negative processing fee for $3

      5. Save net deposit of $97

      6. Accept green match

      Works every time AND IS proper and accepted accounting

        N
        nonyanon
        September 16, 2021

        I need some help with this.  We do not create invoices in QBs.  

         

        We externally invoiced client for $100

        Paypal took out $3

         

        I don't see anyway to split - and we do want to show the $3 as an expense, tho we do not have Paypal in our books as a bank.

         

        Thanks for your help - ny

        A
        AileneAModerator
        Moderator
        September 16, 2021

        Hello, nonyanon. 

         

        Thanks for hopping into this thread! Here are the steps to help your account add the PayPal fee by creating a deposit.  

         

        Here's how: 

          

        1. Click the +New button.
        2. Select Bank Deposit.
        3. On the Select the payments included in this deposit section, select the payment you recently entered.
        4. Below the ACCOUNT column, select your PayPal or Bank Fees account.
        5. Enter the amount of the processing fee. Say -3.
        6. Press Save and close. 

         

        I'm adding this article to learn more about deposits in QBO, How to Record Bank Deposits in QuickBooks Online.

         

        For future task, here are articles you can read on how you can manage your bank deposits:

         

        Additionally, Feel free to check out our articles if you need help familiarizing its features and processes.  

         

        I'm ready to help you out again in managing your transactions in QuickBooks Online. Add your replies here or create a new thread and I'll be right there with you. Stay safe!

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