Paypal foreign currency transfers

Question asked by Sam Neale 4 years ago

Hi, I'm very new to Clearbooks. We have take payments in USD through paypal. Paypal then converts USD to GBP so we get the transaction

"From U.S. Dollar Type: Transfer (credit) Reference: xxx Status: Completed receipt £2253.80

And another transaction

"To British Pound Type: Transfer (debit) Reference: xxx Status: Completed Originally: -3016.16 USD with internal exchange rate 1.3031158842" payment -£2317.57

How do I explain these amounts in Clearbooks?

Thanks

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3 Replies

I am assuming you will have a Paypal account with USD and GBP balances. It would be helpful if you set up both as separate PayPal Bank accounts in CB. Post your transactions to the appropriate currency accounts in the CB created PayPal USD and GBP bank accounts When you transfer PayPal money back to your main UK GBP bank account ( whoever that may be) reconcile the main UK Bank receipt (from your bank download) as a TRANSFER from PayPal (USD) - CB will ask for the currency value (the amount transferred in USD) and that will reconcile with the movement from the USD Balance in PayPal.

If you want to be a bit more sophisticated you can separate the Transfer currency value into the gross transfer and the currency conversion costs ( show the latter as either bank charges or Forex Movements).
PayPal GBP Transactions do not cause any problems as they are transferred at Face value

PS Assuming you invoice in USD allocate the cash receipt against the CB invoice first

Hope that helps

Best answer
4 years ago

Hi

Thanks for your help. I'm not only new to Clearbooks I'm new to foreign transfers so apologies if I need this spelling out in very simple terms! We do have separate USD and GBP accounts in CB but the USD one isn't used at the moment.

So I have the two transactions in my import statement from paypal:

"From US dollar type transfer (credit) reference xyz £1069.32."
"From British Pound type transfer (debit) reference (originally 1453.59) -1110.53"

When you say post these to the USD or GPD Paypal accounts do you mean transfer them? I.e., I have the option to transfer the US dollar type one from Paypal USD to Paypal and visa vera with the other one.

Yes the original payment in USD of $1453.59 has already been allocated.

Should we have set something up differently to start with? We take payments in both currencies and periodically we get a transfer from paypal to the main bank account, but the transfer obviously covers payments that were taking in both currencies.

Thanks in advance

4 years ago

Yes - use the TRANSFER tab in CB Use your main UK bank import to do the transfer transaction - then strike through the Paypal import transaction (you cannot do both) Make sure you get the pre and post currency conversion numbers to reconcile

4 years ago

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