Many eBay sellers face challenges when recording their sales transactions in QuickBooks. Various types of transactions come out as a result of selling on eBay, and all of them need to be accurately accounted for.
According to the statistics, eBay sales in the United States increased by 33% in 2020. As sales increased, eBay sellers received more transactions to report. The only problem is – bookkeeping still can be the most confusing and time-consuming part of doing business on eBay, and one of the most significant ones.
There’s a popular misconception, that an Excel spreadsheet is the only thing you need to know how your business is going. But if manually recording eBay sales works for you now, it most likely will be a nightmare in the future when your business has grown to hundreds of daily transactions. Therefore, the optimization of the e-commerce accounting process is relevant for every eBay seller with more than 1 transaction per day.
Many eBay sellers start to do the accounting in QuickBooks Online hoping to press one button and forget forever about the horrors of the bookkeeping process. But “miracles” happen to those, who know how to use eBay and QuickBooks combination to the fullest. This article was created to become your pocket navigator on the road from eBay to QuickBooks. Continue reading to learn how to get maximum out of the smart eBay and QuickBooks integration and find out a new level of automation for your online business. You’ll find solutions for getting accurate reports on eBay sales, setting up convenient categorization processes, and easy reconciliation. Here’s what we’re going learn about:
1. Recording eBay Sales in QuickBooks
Each sale made on eBay should be recorded accurately in your accounting platform. Recording eBay sales, you should sync all data related to this transaction (shipping, fees, sales tax, etc.) Each of these components has its own specificities. For example, as eBay is famous for the ability to access customers from all over the world, sellers face the challenge of sales tax compliance. Let’s talk more about this issue.
Understand eBay tax obligations which need to be recorded
If you sell on eBay, you should pay attention to the responsibility you have for paying taxes. Every eBay seller should comply with all applicable tax laws and ideally should inform overseas buyers about import charges they pay when receiving the item. Depending on where your customer came from, your tax-related responsibilities may include paying applicable sales taxes, Goods and Services Tax, Value Added Tax, etc.
Since April 1, 2020, about forty jurisdictions require that Internet sales tax is collected. In such cases, the Internet Sales Tax is collected and remitted on eBay sellers’ behalf. It’s very important to keep a thorough record of the tax part of the sale in your reports.
Enter an eBay refund in QuickBooks
If the buyer requires a refund and the sales tax was collected on the original eBay Managed Payments transaction, eBay will refund the sales tax to the buyer. However, if you process refunds through the PayPal platform, the seller is responsible to refund the full amount paid by the buyer at checkout including any paid Internet Sales Tax. After refunding the buyer, eBay will credit the seller with the amounts of any taxes refunded. These financial operations, including the customer refund data, should be recorded in QuickBooks Online.
Include eBay fees when tracking expenses
Any eBay fees associated with the sale of the item also should be recorded. There are several types of eBay fees: the fee eBay automatically takes from each sales transaction, Insertion Fees, Final Value Fees, Listing Upgrades, Fees in Select Categories, and others. All these fees should be synced with QuickBooks, which gives the opportunity to correctly reflect the gross and the net amount of the sale.
It can be extremely time-consuming to put all the sales data into QuickBooks manually. Luckily, QuickBooks marketplace features a solution, which allows you to put “fully packaged” e-commerce data from eBay into QuickBooks. In this article we will be talking about Synder. Besides automatically recording eBay transactions, it correctly accounts for refunds, taxes, discounts, transaction fees, and, as a result, you can perform an easy account reconciliation. All this will work automatically after a few clicks to connect eBay to QuickBooks via Synder. Let’s see how this magic works.
2. Sync eBay orders into Quickbooks via Synder
With Synder, you can synchronize e-commerce data from multiple systems in your accounting platform and perform a one-click reconciliation. It takes all the transaction info from your eBay or other payment platform and transfers it to QuickBooks Online. As a result, you can look forward to an easy account reconciliation without a need for manual entries. Let’s learn more about how it works.
The app creates a Sales Receipt+Expense(s) for a sales transaction from an eBay listing. It also creates expenses/deposits/refunds/transfers – for any other type of transaction (adjustment, payout, dispute, etc.).
All you need to connect eBay to Quickbooks via Synder is just to follow the 3 simple steps below and enjoy a seamless synchronization afterwards.
Step 1: Connecting QuickBooks
Go to the Synder website. Click on “Sign Up for Free” or “Log in” in the upper right corner. Before connecting your eBay to Synder, you need to have your QuickBooks connected.
- Click on the Plus
- Sign and select “Add QuickBooks company”
- Choose QuickBooks and you’ll be taken to its authorization page.
As soon as you connect Synder to QuickBooks, you will get to Step 2 to connect eBay.
Step 2: Connect your eBay to QuickBooks Online
Select eBay managed payments from the drop-down menu, then press the Connect button after getting acquainted with the necessary privacy information.
Step 3: Account Settings (one-click data flow setup)
After eBay connection you just need to adjust your Synder settings to determine how the data will go into QuickBooks. You can use standard configuration and hit “I’m ok to start” or you can click on “Go step-by-step”. Using quick setup is usually enough to make the app work in the right way for you. Here you can choose to automatically record all eBay transactions, apply taxes to them, process payouts, etc. Step-by-step setup allows you to go through more detailed settings. For example, here you can make sure that the app will prevent the synchronization of duplicates.
After the setup you will see the list of your 10 most recent transactions from eBay in the Synder Transactions tab. You will see that one transaction has been synced to QuickBooks Online automatically. Then you can select more historic transactions and synchronize them with QuickBooks Online and/or turn on the “Auto sync” mode to enjoy a seamless auto-synchronization of all future transactions (according to your setup).
3. What objects are created in QuickBooks Online after the sync?
Let’s take a look at the objects which are created in QuickBooks Online after the sync of eBay managed payments transactions. It depends on the type of transaction being synced, as Synder creates:
|Type of transaction||Objects created on the QuickBooks Online side|
4. Easy reconciliation of eBay transactions
As an eBay business owner, you should keep close control over the reporting of transaction activity to ensure profitability, prevent any mess-ups in your books, and identify areas for improvement. Reconciliation is a major accounting process that helps you in this regard and ensures that financial records and the actual bank balance match. Therefore, account reconciliation is an important part of your accounting, designed to keep your business taken care of and in good shape.
However, there are many challenges in eBay transactions reconciliation, such as matching the platform fees, including all transaction data, accounting for refunds, etc. One of the most widespread problems in manual reconciliation is endless double checks.
Luckily, today you can reconcile in a few clicks with minimum manual input and no duplicates. A few click reconciliation is available thanks to individual payouts being synchronized automatically in the background.
Make sure you enabled the Payouts feature in the Synder settings to sync them along with regular transactions. Don’t worry, payouts will not duplicate your bank feed records.
Learn more about reconciling transactions in QuickBooks Online:
5. Categorizing eBay sales in Quickbooks
Good organization and order are important not only on supermarket shelves but also in business on eBay. While a little mess in the supermarket only brings headaches to a supermarket manager, a mess in your books can ruin your online business. Luckily, Synder allows you to automate the income categorization for eBay.
For more details, see a video tutorial made by Synder help center:
If a Product name from your transaction matches the product name in your QuickBooks – the transaction will be applied to this product and its income account, and all data will be categorized automatically. If product names don’t match, you can create a new product name or set up the categorization based on certain traits using the Synder Product Mapping feature.
The categorization feature also guarantees that you will always have up-to-date reports (including the Profit and Loss report) and will facilitate the account reconciliation.
Learn more about the Product Mapping Feature with Synder Tutorials:
6. Categorizing eBay shipping in QuickBooks
To categorize eBay shipping in Quickbooks, we advise to create a separate account for all your shipping expenses, if you don’t already have one.
When the transaction is synced, Synder will put the shipping amount into the right field in the QuickBooks transaction, and that amount will go to the account configured for shipping. It will assist in ensuring an easy reconciliation and accurate reports.
7. Connecting alternative payment gateways to Quickbooks
We have already found out how to sync all sales transactions with QuickBooks if they are processed by eBay Managed Payments. Is there something you can do if you are also using other payment gateways to charge your clients, such as Paypal or Stripe? With Synder, you can easily connect them as well as Amazon, Shopify, Square, Ecwid and other platforms in a few clicks.
Here you can check how to connect a payment platform to Synder. Watch the video below to see how easy it is!
Synder is an e-commerce accounting automation solution. It allows you to synchronize payment systems or e-commerce platforms with accounting software, and automatically manage your finances. As a result, you will have accurate data in the accounting system, correct tax and product reports, and easy account reconciliation.
Synder users can leverage the functionality of QuickBooks to the full extent and enhance their reconciliation by preventing mismatches and eliminating the need to recheck the data. Online business owners appreciate the simplicity of setting up and using an app that doesn’t require having special technical skills to work with it. Once set up, Synder works automatically in the background.
Don’t hesitate to test the app here with the 10 free syncs provided (no credit card required to start). A dedicated support team is always there to help if you have any questions.
Disclaimer: The article is not a legal guideline. For professional expertise in taxes or other legal issues, we recommend consulting a CPA or a certified tax practitioner.