Accounting Help - Auctions/EBay

[voyage]

Good morning on Sunday! Wonder how many others never switch off!

Hoping for some advice on helping keeping the books straight.

I have created a simple excel spreadsheet to help do my accounting for been self employed. I felt it best to do it this way as I am fairly confident with excel and what I do is fairly simple. I am recording incomings and outgoings in two columns.

However the amount I sell for and amount I receive are two different things. For example on eBay you may sell the item for £10 but only receive £8.50 after fees from EBay and PayPal. How would you best advise to show this, as obviously I sold it for £10 so this is my sale price but incurred £1.50 in expenses.

Thank you for any advice.


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[kevin.doran]

You've said it in your last sentence: £10 sale, £1.50 expense.

 

[voyage]

You've said it in your last sentence: £10 sale, £1.50 expense.

Thank you. I am more thinking on how to show this on the spreadsheet. It isn't really money out as it's taken at the time of sale, so never actually leaves my account, like other expenses which are usually purchases.

As you can probably tell I am new to this and just want to try keep good records from the start


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[boring-friday]

You still record it as a expense, ebay bill you monthly so thats easy enough, if you have your paypal as business account it says the monthly total somewhere

 

[kevin.doran]

PayPal is a separate bank account in its own right. You would therefore show the £10 sale coming in, the £1.50 expense going out and once you withdraw the funds to your nominated bank account it would be an inter-account transfer (or drawings if you're self employed and taking the money for yourself).

I wouldn't personally work off a spreadsheet. There's plenty of free software out there if your business doesn't warrant the cost. VT Cash Book for example would be an excellent choice or there might even be a free cloud one with an automatic PayPal feed.

I personally think good bookkeeping software is worth paying for though...

 

[voyage]

I don't mind paying for software and it might be the best option then. Just don't want something that over complicates matters if possible.

I have multiple PayPal accounts and understand they act as separate bank account. They all withdraw into the same business bank account.

Thanks for the advice it is really appreciated


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[Energise Accounting]

Accounts portal is cheap enough and will probably suit your needs.

 

[voyage]

Will take a look at this.

Been looking at the Kashflow site, seems reasonable, £10per month


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[silvermusic]

I've seen many people over complicate recording ebay sales. However, eBay has a secret weapon, File Exchange http://sellercentre.ebay.co.uk/file-exchange You can download the last rolling three months sales data as a CSV file to load into Excel, it gives you all the info you need and a lot you probably don't as well. It's then a simple matter of totalling up the columns. This will give you post costs, eBay costs, etc. Just remember to download it once a month.

Same for PayPal although their records date back to the day you opened your account with them, you can download your figures as a spreadsheet too.

You may just need overall monthly or yearly figures rather than for each item. Talk to you accountant. I do mine as monthly totals.

 

[voyage]

Great thank you.
Do you an accounting package at all?


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[Pish_Pash]

I don't mind paying for software and it might be the best option then. Just don't want something that over complicates matters if possible.

Using Excel might seem as if you're keeping it simple, but it can get unwieldy very quickly ....accounting software can actually be very simple to use & often pretty much 'hand holds' you through the process of entering data...I use Quickbooks & very content with it.

 

[silvermusic]

To some extent I feel it depends on how much detail you want or need to keep. For myself, knowing the total eBay, PayPal and postage fees once a month with my other costs I can do a very simple accounts entry. All the detail is there should my accountant want to dive down into the details. I have no need to analyse the fine detail for each transaction. I can tell at a glance every month how much profit I'm making.

 

[voyage]

Using Excel might seem as if you're keeping it simple, but it can get unwieldy very quickly ....accounting software can actually be very simple to use & often pretty much 'hand holds' you through the process of entering data...I use Quickbooks & very content with it.

Just taken a look at quick books.

Might be very helpful for me. I am currently employed and self employed. So really wanting to keep on top of all the accounting. I presume you can have multiple bank accounts and have one as the PayPal account etc?

Lots of packages seem very similar, I know some offer free trials etc but don't have time to try them all.

Appreciate all the advice


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[kevin.doran]

How many PayPal transactions are we talking each month?

 

[Pish_Pash]

Just taken a look at quick books.
Might be very helpful for me. I am currently employed and self employed. So really wanting to keep on top of all the accounting. I presume you can have multiple bank accounts and have one as the PayPal account etc?

Yes, as many bank accounts as you want in Quickbooks....paypal gbp, paypal eur, paypal usd, world first eur, stripe USD & on & on.

 

[voyage]

How many PayPal transactions are we talking each month?

Around 20-100 per account. 4 accounts

I think manual export and then upload at end of each month be best.


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[MyAccountantOnline]

Accounts portal is cheap enough and will probably suit your needs.

It's certainly one of my favourites and works well. It does have a facility to import PayPal transactions.

 

[kevin.doran]

It's certainly one of my favourites and works well. It does have a facility to import PayPal transactions.

Out of interest, can it handle FX?

 

[MyAccountantOnline]

Out of interest, can it handle FX?

I dont believe it does.

 

[kevin.doran]

Around 20-100 per account. 4 accounts

I think manual export and then upload at end of each month be best.


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You've got two options re sales:

1) Pick a software that can feed the transactions straight in automatically - great if you do want to log each one by one (doesn't take that long for 200-400 transactions pm)

2) Summarise the sales/fees in bulk by using the available reports (example shown here) - make sure you keep a copy of all backing reports in case HMRC ever want to see them.

Purchases I would still tend to list individually no matter what, i'm not a fan of grouping them together.

 

[voyage]

You've got two options re sales:

1) Pick a software that can feed the transactions straight in automatically - great if you do want to log each one by one (doesn't take that long for 200-400 transactions pm)

2) Summarise the sales/fees in bulk by using the available reports (example shown here) - make sure you keep a copy of all backing reports in case HMRC ever want to see them.

Purchases I would still tend to list individually no matter what, i'm not a fan of grouping them together.

Brilliant thank you. I think I will do it in bulk at the end of each month


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[voyage]

Anyone familiar with Kashflow? Signed up for the free trial and just wondering how to show some of the sales at auction houses.
Do I create an invoice, and then put the fees down as a purchase :/


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[k100danny]

sales report for paypal shows everything you need. we used to do around 1500 paypal transactions per month, this will show you your totals. No need to enter them separately.

out of interest is there a reason you use more than one paypal account? we had 4 ebay accounts many years ago and all used the same paypal account with no trouble at all.

 

[kevin.doran]

out of interest is there a reason you use more than one paypal account?

I'd presumed he meant different currencies.

 

[voyage]

sales report for paypal shows everything you need. we used to do around 1500 paypal transactions per month, this will show you your totals. No need to enter them separately.

out of interest is there a reason you use more than one paypal account? we had 4 ebay accounts many years ago and all used the same paypal account with no trouble at all.

Brilliant thank you.

It's just how it's setup. We were advised this way and works ok.

It's not PayPal causing the issue as I think we will do a upload of the excel sheet. Its the actual sales at physical auction houses.

So for example I sell the items for £100 and there is £20 commission. We then get a BACS payment for £80, however we need to show the actual sale for £100.

Kashflow are saying could either enter the sales invoice with a negative line item for the charge.

Or raise the invoice without the negative line item.
Mark it as paid in full
Then put an expense as a purchase for the commission.

Neither of these work as it won't link up to the payments pulled in from the bank account.

Will the other packages recommended be any simpler?

Thanks again for any advice


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[Pish_Pash]

I'm no accountant, but since you are being paid at the point of purchase....it's a sales receipt that's in play not an invoice (I don't know about other accounts software, but an 'invoice' requires an extra admin step in quickbooks ....namely payment).

Here's how I do it in Quickbooks....

Let's say an Ebay sale is made for £10.... of that £1 is ebay fees & 40p in Paypal fees (but I don't go as granular as entering the fees for each sale - that will send you gaga in short order - I bulk them up & enter these fees monthly - for your convenience, Ebay & Paypal provide monthly statements).....

In Quickbooks.....

A 'customer' sales receipt gets created in Quickbooks for £10 (I've semi-automated my Quickbooks to enter every sale by individual customer name, as there's no time overhead doing this in my situation - it also allows me to track stock/trends in a very granular fashion)

The proceeds (payment) from the Ebay sale goes into a quickbooks 'bank' called paypal gbp (you can think of a Quickbooks paypal gbp bank account as just a holding bucket)

I enter Ebay fees as a supplier's bill once per month (expense account = online selling fees) ...as mentioned all the ebay fees per are aggregated (therefore the above £1 fee will be contained within). I pay the 'bill' from the Quickbook 'bank' called paypal gbp.

I also enter paypal fees as a supplier's bill once per month (expense account = bank charges) ...again, the paypal fees 'per sale' are aggregated (therefore the above 40p fee will be contained within). I pay it from the Quickbook bank 'bank' called paypal gbp.

For clarity, if only made the one sale (as per the example above), at the end of the month, my Quickbooks paypal gbp bank account will have £8.60 sitting in it.

FWIW, I nearly got sucker punched into taking a 'free' cloud subscription when I first started up ...I was bamboozled at this brave new world & was perilously close to falling for the 'free introductory period' [cough scam] , I'm pleased I toughed it out & dodged that bullet...IMHO a typical 'cloud offering' is simply an open invitation to make them pregnant (& rich) - you'll be paying them child maintenance for years.

 

[voyage]

I'm no accountant, but since you are being paid at the point of purchase....it's a sales receipt that's in play not an invoice (I don't know about other accounts software, but an 'invoice' requires an extra admin step in quickbooks ....namely payment).

Here's how I do it in Quickbooks....

Let's say an Ebay sale is made for £10.... of that £1 is ebay fees & 40p in Paypal fees (but I don't go as granular as entering the fees for each sale - that will send you gaga in short order - I bulk them up & enter these fees monthly - for your convenience, Ebay & Paypal provide monthly statements).....

In Quickbooks.....

A 'customer' sales receipt gets created in Quickbooks for £10 (I've semi-automated my Quickbooks to enter every sale by individual customer name, as there's no time overhead doing this in my situation - it also allows me to track stock/trends in a very granular fashion)

The proceeds (payment) from the Ebay sale goes into a quickbooks 'bank' called paypal gbp (you can think of a Quickbooks paypal gbp bank account as just a holding bucket)

I enter Ebay fees as a supplier's bill once per month (expense account = online selling fees) ...as mentioned all the ebay fees per are aggregated (therefore the above £1 fee will be contained within). I pay the 'bill' from the Quickbook 'bank' called paypal gbp.

I also enter paypal fees as a supplier's bill once per month (expense account = bank charges) ...again, the paypal fees 'per sale' are aggregated (therefore the above 40p fee will be contained within). I pay it from the Quickbook bank 'bank' called paypal gbp.

For clarity, if only made the one sale (as per the example above), at the end of the month, my Quickbooks paypal gbp bank account will have £8.60 sitting in it.

FWIW, I nearly got sucker punched into taking a 'free' cloud subscription when I first started up ...I was bamboozled at this brave new world & was perilously close to falling for the 'free introductory period' [cough scam] , I'm pleased I toughed it out & dodged that bullet...IMHO a typical 'cloud offering' is simply an open invitation to make them pregnant (& rich) - you'll be paying them child maintenance for years.

Will take another look at quickbooks. Thank you for your in depth reply. Will have to go over it a few times but makes sense. Really appreciated thank you


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