accounting for credit from paypal 0.01

Question asked by Mike Ashworth 3 years ago

hi, ive recently set up my paypal business bank account.

as part of this they send me a paymetn of 0.01 to my bank account.

as yet i am yet to process any transactions via paypal, so no transaction fees to pay or offset this againsy.

my question: the 0.01 is sitting there in my bank import as an unallocated transaction.

what entry do i need to make to process and have everything reconcile?

8 Replies

Afternoon Mike,

I would suggest explaining the transaction to the account bank fees.

Adding any information that you would need to help you identify the purpose of these funds in the future.

I hope this helps.

hiya, do you mean the account listed as Bank Charges that sits under the heading "finance charges".

and i use the "refund" tab to do this yeah?

Yes, the Bank Charges account.

It depends on the purpose of the 0.01 transaction?

To clarify, Paypal has sent 0.01 to your account which currently sitting on the account? Do they have intentions of refunding the funds in the future?

it's my understanding that at some point in the future when i were to use the paypal business account this is deducted fro ma payment made to me. it's what i read somewhere.

At present I dont know when I will use paypal as clients i have taken on are are paying by gocardless at the moment.

I see. In that case, I would say explain the transaction normally. Then when a transaction is made and the 0.01 balance is reclaimed assign the same account code.

It may be worth creating a Paypal fees account ready for when you may start using the service.

Hope this helps.

i will create a paypal fees account, keeps everything in one place which is cool.

am i right in thinking that to create this i do the following

settings => accounting => account codes

create account code

account name: paypal fees accoutn type ; finance expense (same type used for bank charges)

thankyou. i'll create a separate post for a question about my very first go cardless payment received :-)

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