How it runs for e-commerce brands and Amazon sellers
Gateway balances are reconciled as accounts of their own, so the bank, the processors and the sales ledger agree every week.
What is payment processor reconciliation?
Payment processor reconciliation is the work of proving that the money a processor or marketplace deposits equals your gross sales less its fees, refunds, chargebacks, reserves and adjustments for the same settlement period. Each payout is broken into its parts and posted so revenue, fees and sales tax are correct and the bank deposit matches to the cent.
What we handle for e-commerce brands and Amazon sellers
- Stripe, Shopify Payments and PayPal payouts split into orders, fees, refunds and disputes
- Klarna, Afterpay and Amazon Pay settlements reconciled on their own cycles
- Chargebacks traced to the original order with evidence assembled
- Processor reserves and rolling holds tracked as receivables
- Gateway balances reconciled as separate accounts every month
The KPI that matters here
Every processor payout matched to its orders within 3 business days of settlement.
E-commerce compliance notes
Marketplace facilitator laws
Every US state with a sales tax now requires marketplaces such as Amazon, Walmart, eBay and Etsy to collect and remit sales tax on third-party sales. The marketplace's collections appear in your settlement reports and must be recorded as tax collected and remitted by the facilitator, not as your liability. Some states still require registered sellers to file returns that report marketplace sales as exempt.
Sales-tax nexus on direct sales
Direct sales through Shopify, your own site or wholesale count toward each state's economic nexus threshold, commonly $100,000 in sales or 200 transactions in the current or prior year, and inventory stored in FBA warehouses can create physical nexus. We track sales by state monthly, flag thresholds approaching and prepare the workings for TaxJar, Avalara or your filing provider. Registration and filing decisions rest with you and your tax adviser.
VAT, GST and cross-border selling
Selling into the UK requires VAT registration once taxable turnover passes £90,000, or from the first sale for many overseas sellers, and EU distance sales can be reported through the One Stop Shop. Canadian GST/HST and Australian GST apply to imported low-value goods and to registered sellers. We prepare VAT and GST workings for your accountant or registered agent to file; we do not submit returns.
Inventory valuation and 1099-K reporting
Inventory must be valued consistently, including freight, duties and prep, so COGS and taxable income are right. Payment processors and marketplaces issue Form 1099-K for gross payments, which is reconciled to recorded sales so the figures your CPA reports agree with what the IRS receives. Tax preparation is support only; your firm reviews and signs.
E-commerce software we work in
More for e-commerce brands and Amazon sellers
Other services for e-commerce
Payment processor reconciliation in other industries
Frequently asked questions
Why do processor fees need to be posted separately?
Because fees differ by processor and by payment method, and hiding them inside net revenue makes channel and gateway comparisons impossible. Posting Stripe, Shopify Payments, PayPal and instalment provider fees to their own accounts shows what each costs as a percentage of sales, which informs which methods to offer and how to price.
How do you handle chargebacks and disputes?
A chargeback is posted against the original order with the reason code, the dispute fee is expensed and the accountant assembles the order, tracking and customer communication for your response through the processor's dispute tool. Outcomes are recorded when the processor rules, and dispute rates by product and channel are reported so patterns can be addressed.
What is a rolling reserve and how is it recorded?
A rolling reserve is a percentage of each payout the processor holds for a period, commonly after a rise in disputes or refunds, and releases later. The withheld amount is recorded as a receivable from the processor when withheld and cleared when released. The ledger balance for the processor then matches the balance shown in its dashboard.
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