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Ecommerce, Paypal and VAT

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I have a retail client who registered for VAT on 1st September. Prior to that I would take the monthly paypal sales with am adjustment at year end for sales prior to the paypal receipt date.  Now that they have gone VAT registered I need to work out a sysytem as how best to record sales.  There are sales from an ecommerce site, mostly through Paypal but some through a card merchant, and direct paypal sales from facebook orders. So first port of call is to report all daily website sales, which isn't an issue, then record all direct paypal sales but discard the website sales, which is where I'm stuck.  If the client has raised a paypal invoice, paypal records it on the day payment is made, which is usually the day after, and I have to work out which is a website sale, which is a paypal invoice sale, and which is a paypal sale without an invoice (this is usually when the clients customer just makes a payment and no invoice is raised, so that will be same day.

I've had a look on paypal but I can't see anyway to do this without manually checking each sale to get the correct date I need for the VAT, which is going to be a real ball ache.  If anyone has any suggestions I would be eternally grateful.

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By Wanderer
12th Dec 2018 17:20

How many sales (in total) per week?

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By legerman
12th Dec 2018 18:30

Wanderer wrote:

How many sales (in total) per week?

Approx 50 a week

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By Wanderer
14th Dec 2018 07:36

Okay I have a similar case.

I've set up a simple spreadsheet in which client records their sales with columns for how paid - card, direct, PayPal, cash etc. This is prepared and totalled on a weekly basis.

You can then use this to post / import into whatever accounting system you use. You can then control each of the sources within the accounts system.

You appear to be concerned about PayPal invoice dates. Personally I would ignore these. In my view they are no more that 'requests for payment' and in practice many won't get paid. Just use the date of receipt of funds as the tax point date.

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By legerman
17th Dec 2018 12:48

Wanderer wrote:

You appear to be concerned about PayPal invoice dates. Personally I would ignore these. In my view they are no more that 'requests for payment' and in practice many won't get paid. Just use the date of receipt of funds as the tax point date.

Hi thanks, yes that was my worry. I thought the date had to be bang on tax point wise. Many thanks

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By bettybobbymeggie
12th Dec 2018 17:59

Have you had a play with the csv file you get out of Paypal? For instance there is an Invoice Number field which can be of use if you can identify the first invoice number for the period you are looking at...just a thought.

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By legerman
12th Dec 2018 18:33

bettybobbymeggie wrote:

Have you had a play with the csv file you get out of Paypal? For instance there is an Invoice Number field which can be of use if you can identify the first invoice number for the period you are looking at...just a thought.

It might help, but where do I find it please? I've looked at the financial summary break down, which lists the individual transactions, which is not always accurate as to where the sale came from, and the monthly sales report, that gives me the daily sales figure and how many sales that day.

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By bettybobbymeggie
12th Dec 2018 18:58

It is under Activity download (directly above where you get your Financial summaries).

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By legerman
13th Dec 2018 15:06

bettybobbymeggie wrote:

It is under Activity download (directly above where you get your Financial summaries).

Thank you

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By NH
13th Dec 2018 21:16

Why don't you just use cash accounting for vat?

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By atleastisoundknowledgable...
14th Dec 2018 08:07

If the issue is identifying which PayPal sales are & aren’t from the website, why don’t you not record PayPal sales from the website & just use PayPal’s record?

Sales per PayPal + sales per card merchant = total sales. Simplist way is sometimes the best. Or am I oversimplifying?

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By legerman
14th Dec 2018 15:10

atleastisoundknowledgable... wrote:

If the issue is identifying which PayPal sales are & aren’t from the website, why don’t you not record PayPal sales from the website & just use PayPal’s record?

Sales per PayPal + sales per card merchant = total sales. Simplist way is sometimes the best. Or am I oversimplifying?

That's what I've done up to press but now they are VAT reg I have to record daily sales, and some of the paypal payments will have been received a day or two later. I'm going to have to consider VAT cash accounting I think as per another suggestion.

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By atleastisoundknowledgable...
14th Dec 2018 15:29

Ok, but rather than identifying for each & every PayPal receipt it’s origin, can’t you say “PayPal receipts of X, I’ve recorded Y from the website so X-Y=Z direct sales.”

Yes there will be a slight timing adjustment each month/quarter-end, but you’ll only be looking at 3-5 days worth of transactions

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