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Best method of reconciling paypal for xero

What is the best and quickest way to reconcile paypal on xero?

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I have a couple of clients that run online stores that generate a huge number of paypal transactions that can be incredibly laborious and time consuming to reconcile. This creates a couple of problems being:

  1. They each have paypal loans that are paid back at an agreed percentage per sale. Xero repeatedly deletes a number of these transactions as it recognises that they are often payments made for the same amount, to the same place on the same day
  2. It takes an incredibly long time to reconcile the transactions even though we have rules set up for most, even just clicking ok takes time.

Does anyone know of a better way of dealing with this? We have tried cash coding but have noticed they are making a lot of mistakes doing it this way. Is there any form of integration software that can help? I.e total up the transactons on a daily/ weekly basis making it easier to post whilst also cutting out the mistakes and preventing any transactions being incorrectly deleted.

Or alternatively, is there a better online bookkeeping system that allows you to deal with these transactions easier than xero currently do?

Thanks in advance!

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By daniel_
12th Nov 2019 10:25

Perhaps somehow integrate the online store with Xero, e.g. Zapier or other connector which links with Xero's API and Paypal's API.

For example, when a successful web order is placed and paid for:
1. Raise a Xero sales invoice using the order number as reference.
2. Post an unreconciled Paypal bank transaction as payment of invoice
3. Post a Paypal bank transaction for the fees/loan repayment (if this can be easily calculated from the value of the sale).

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By SouthCoastAcc
12th Nov 2019 12:12

Yeah there are apps that can help you in future

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Nigel Harris
By Nigel Harris
14th Nov 2019 11:05

I haven't done it with really huge volumes of transactions, but for smaller online stores using PayPal I download the statements from PayPal monthly in Excel, do all the data manipulation in Excel and then just post the totals to Xero. Very quick to do.

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Replying to nigel:
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By wrilliams
15th Nov 2019 08:30

The trouble with this is that the records will no longer be MTD compliant as you will not have a digital link to the full transactions when submitting the VAT return. You would need to import the full transactions list into Xero rather than simply posting the totals.

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By jsgraver
14th Nov 2019 11:30

reconsilo

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A Putey FACA
By Arthur Putey
19th Nov 2019 17:58

The way to go here would seem to be to integrate the online store to Xero. A consideration where there are large volumes of sales is what level of detail to pass to Xero. If payments are handled in the online store, I would look at an integration that passes summary sales data to Xero, and argue that the digtial link exists back to the detail in the store. It gets more complicated where payments are processed in Xero, in which case the challenge question is whether the paypal statement is itself part of the so called "digital journey"(where on the cash scheme). I suspect there will be some fascinatingly tedious cases after April 2020 if HMRC which will clarify. Including no doubt whether an Excel macro falls in or out of the definition of "copy and paste". Another moot point would be whether creating a summary invoice in Xero and attaching an Excel of the detail meets the requirement.

MTD aside, the simplest way would be not to have a Xero bank feed, post summary sales and the other PayPal transactions, and manually reconcile to the statements.

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