Hi there,
Hope you can help… I have managed to tangle myself up a bit with paypal integration.
My paypal integration plug-in is working nicely, and pulls in all the separate transactions in to my Paypal(username) Merchant Account. From here I see that all the transactions are in need of being TAGGED. So I tag them appropriately (eg. Taxi firm, tagged to “Travelling” etc).
Separately, at the end of the month when my bank statment is ready, I pull in all my other transactions from my bank feed (using the Google Chrome Export transactions plugin. After pulling in all the bank transactions into my current account, I see mulitple transations for payments made to Paypal. When I tag these, it tags to Paypal(username) Merchant Account, but not against any specific paypal transaction within that Paypal(username) Merchant Account.
My questions are:
am I doing the right thing by tagging in both areas (in the current account, and in the Paypal(username) Merchant Account)
isn’t it double accounting, by tagging in both the current account and the Paypal(username) Merchant Account?
Ideally your paypal a/c should be tagged to P&L and balance sheet items(if any) and payments made to paypal from bank should be treated as interbank transfers i.e tag it from your main bank to paypal a/c, this way it wont be double counting. Assuming you move bulk funds to paypal from bank and then use paypal balance to pay for items
If your bank is main source of individual transactions of paypal then there is no need to feed in paypal as such
The way a merchant account works is that you actually have 3 parts to every transaction from a client:
The full amount paid by the client
The merchant fee
The balance which is paid out to you.
With a payment out (e.g., You used PayPal to pay for something), you would have:
The amount paid from your bank to your PayPal account
The amount paid from PayPal to your supplier
What you’re doing sounds correct, but:
I just want to clarify this point. The transfer on the current account won’t tag itself to the same transaction on PayPal. However, if you have the balancing entry on PayPal (e.g. £20 out of your current account to £20 into your PayPal account), you will often find that even if the transaction exists on the PayPal account, they won’t match because of the dates, as it takes a day or two for the money to leave your account.
If this is the case, you may find it easier to prevent those from being created automatically in your PayPal account, by going to the merchant account bank account, selecting More Options >> Feed Settings, and ticking the box to ignore transfers.
Thanks for the quick response, and thanks for confirming that I am doing the right thing by tagging BOTH (i) the transfer to Paypal within the Current account; (ii) each individual feed transaction within the Merchant Account.
I have to say, I still am a bit confused about what exactly the tickbox is for? I already saw the guidance about ticking the “ignore transfers” checkbox on the Knoweldgebase post (“Setup Paypal automated feed”).
I have verified in my feed settings, and noticed that it is in fact already ticked.
I understand your example above:
However, in the scenario where I make a purchase from VendorX using paypal, what is the tickbox actually preventing?
The tickbox states “Ignore transfers to bank”
In which scenario would there be a transfer to the bank, because i don’t see that in the quoted example?
_Note, if it’s relevant(?): we never accept payments from clients/customers using paypal, because the nature of our business does not warrant this.
The top one, “Payment to” is the money leaving your PayPal account going to your supplier.
The bottom one, “Transfer from” is the money leaving your bank account and going to your PayPal account.
The date on the bottom one, as I mentioned above, doesn’t usually match the date it affects your bank because of the time it takes to process. So ticking the “ignore” box in the settings, will prevent the bottom transaction being created automatically.
When the money leaves your bank account, you can create the transaction (or let a bank feed do it), and then tag it as a transfer to the PayPal account, which in turn creates a matching transaction for you.
@indypanesar - I just wanted to let you know that further to the posts above, we have revised the wording on the settings page to clarify that the “ignore transfers” affects both those in and out of the PayPal account.
