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Level 2

Correctly Recording Etsy Transfers and Fees

I'm trying to find the correct way to deal with Etsy transfers (payment for sales) from my Etsy account into my bank account in Quickbooks. I see the weekly transfers in banking and have the option to add, match or transfer of course. I can't match them to multiple sales receipts as Etsy takes out the fees before transferring. I'm unsure where the money goes if I add it or transfer it. When I create sales receipt I can choose "cash, check, Paypal, Etsy Direct Payments" etc, so I choose "Etsy Direct Payments" (and the "deposit to" field is "undeposited funds") if the sale is going to come from an Etsy transfer into my bank account. I created an Etsy Shop Funds Bank in my chart of accounts like I did for my Paypal sales, but the chart of accounts shows 0. I think the bookkeeper who initially helped me set up my account must have suggested that. Can you please offer guidance on how to record the transfer so it matches up with my QB sales receipts? I have been able to download a report from Etsy and create a spreadsheet showing the breakdown for individual sales and the fees that being taken out each month. Just not sure where to record these fees since I do not record them on the sales receipts. Thank you in advance for any help!

QuickBooks Team

Correctly Recording Etsy Transfers and Fees

I'd like to help you get this sorted out, artisanpopcorn.


If the sales receipts are deposited to the Undeposited Funds account, you'll want to create a deposit. Please make sure to use the bank account where the transactions are downloaded. Then, match the transactions in the banking section.


To record a deposit, you can follow these steps:


  1. Go to the + New > Bank Deposit.
  2. Select the bank account from the drop-down menu, and select the transaction you want to deposit under Select the payments included in this deposit section.
  3. Click Save and close

Do the same steps with the other sales receipts. Once done, you can go back to the Banking page and match the transactions. I've got this article for the detailed instructions: Match and categorize bank transactions in QuickBooks Online.


Please let me know if you're able to match the transactions or if you have any other questions. Thanks.

Level 2

Correctly Recording Etsy Transfers and Fees

Thank you RenjolynC,


I appreciate your help. I am clear on how to create a deposit, but I'm unsure on how to match these up:


Sales Receipts - I record my Etsy sales receipts choosing the payment method as "Etsy Direct Payments" in "Undeposited Funds"


Banking - I see my Etsy direct deposits into my checking account, but the totals include fees taken out from Etsy that will not match my existing sales receipts, even if I create a bank deposit.


How do I record the Etsy fees so I can match my sales receipts and Etsy transfers coming into my checking account?


Thanks for any further guidance.

QuickBooks Team

Correctly Recording Etsy Transfers and Fees

Good evening, @artisanpopcorn


Before following my suggestion below, I recommend reaching out to your accountant to see if this is the best solution for your books.


Once the Sales Receipt has been created and you've received the Deposit in your Bank Feeds, then I'd create the Bank Deposit. In the Bank Deposit window, at the bottom under Add funds to this deposit, enter in the Etsy fee information. I would make the amount show up as negative so that it can match your Bank Feed Deposit. Once this is completed, then you can Match your transactions with ease.


Let me know if I can help you further! Have a great day.

Level 2

Correctly Recording Etsy Transfers and Fees

Dear Ashley H,


That's a great suggestion, thank you! I see that option now at the bottom of the page when creating a new deposit. I don't have much experience in accounting, as I'm sure you can tell, so could you advise on one last aspect? At the bottom of the new deposit for "adding funds" I see there are fields for "received from, account, description, payment method and amount." It looks like for "received from" I do have a vendor already set up as "Etsy Seller Fees". Should I use this or the "commissions and fees" category or leave it blank? For "account" I'm not sure what to use. Should I use an income, bank, assets, equity, COGS or expense account? For "payment method" it looks like the only choice would be the "Etsy Direct Bank Payments" that I select on my sales receipts? Not cash, check etc. Just want to make sure the fees show up where they are suppose to.


Thank you, thank you, or anyone available, if can advise one last time!!

QuickBooks Team

Correctly Recording Etsy Transfers and Fees

Hi there, @artisanpopcorn


Thanks for following up with us. I'm happy to hear you're on the right track. 


I can provide you the steps of correctly recording a deposit in QuickBooks Online. See the steps below on how to do this. However, to know what fits your company best, you'd need to reach out to your accountant to know more about what accounts need to go in each field. 


  1. Click the +New button at the top left-hand corner. 
  2. Select Bank Deposit
  3. From the Account drop-down, pick the account you wish to record the deposit to. 
  4. Fill in the required information and hit Save and Close. 

 Check out: Record and make Bank Deposits in QuickBooks Online for a quick how-to video guide and steps on recording a deposit in QuickBooks Online. 


Please let me know if you have further questions or concerns. I'll be here to guide you in the right direction. You can always reach out to the Community or me anytime you find you need assistance. Take care and have a good one! 


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