Folksy Ltd

The abyss that is paypal


(Louise Foot) #1

My apologies in advance for darkening the forum with the nasty subject of accounts AGAIN.
Todays (lol) question is how does Paypal fit in to doing end of year accounts ? To me paypal is a weird abyss so most transactions won’t show on my bank balance except when there’s insufficient funds or if I transfer funds in to my bank account. How might I reflect this in my end of year accounts?
Any help, advice would be much appreciated ?
Louise


(Melanie Commins) #2

In my accounting software I have a separate entry for PayPal in my ‘current assets’ list and simply record transactions exactly the same way as I do for my bank account … incomings, outgoings etc. If I’m transferring funds from PayPal to my bank account it’s just a transfer of money from one place to another.

If I have a positive balance in there when it comes to the end of the accounting period then that money is just added to the total assets that my business has at that point in time.


(Deborah Jones) #3

I try to transfer all the money out of my paypal account on a regular basis , so that when I make a purchase the entire amount goes from my bank account , that way the figures tally with the invoices when I am trying to do my books. Otherwise I get in a complete muddle. I also keep a written record of all sales and purchases next to the computer , so that if I have forgotten to print off an invoice I can find it easily, as it can be a real pain otherwise as often the figures are in different currencies .


(Sasha Garrett) #4

I’m a bit like Deborah - I transfer the money out of my paypal account after each transaction and when I make a purchase it comes out of the bank account. Makes it easy to tally everything up even if it makes my bank statements long. I have a monthly entry on my accounts spreadsheet called paypal fees so that I have a record of the fees that were paid with money that never made it into my bank account (I also have an entry for iZettle fees as they come out of the money before it is deposited into my bank account).
If you can print out a record of all your paypal transactions and then treat it as you would a bank account statement - double check that you have a reciept or invoice for all entries and that money transfers in or out match with a transaction in your bank account.


(Shirley Woosey) #5

The best way for accounts is to treat Paypal as another Bank Account.

If you log into your account and activity and then return to the Classic Account you can get printouts of all activity and balances for the whole tax year. These can then be treated as Paypal bank statements.

Shirley


(Diane Keeble) #6

I try to do my accounts as I go along and keep a record of all payments in and out in a book - very old fashioned I know!


(Louise Foot) #7

Oh wow, just had a big garden break & returned to all your replies. Thanks ever so much for taking the time to share your wisdom & expertise :smile:
Melanie, your approach sounds very appealing - do you mind my asking what software you use?

Thanks all x


(Brenda Cumming) #8

that is exactly the way I do it Di…one book…debit and credit (one each end of the book) Give it to my accountant…job done.


(Melanie Commins) #9

I use a freebie program called gnucash, you can d/l it from http://www.gnucash.org/

Having never had to keep books before, I was a bit daunted when I started using it but for a small business like mine I don’t need half the features so once I figured that out it was pretty simple.

If you decide to use it and want any help then let me know and i’ll do my best! :smile:


(Louise Foot) #10

Thanks so much Melanie may well take you up on your kind offer if I struggle. I’m going to brave it all on Monday. Weekend starts early for me as we have visitors tomorrow. It will feel really good if I achieve this :slight_smile: