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Working inside PayPal: what LedgerBPO does
PayPal bookkeeping services from LedgerBPO give online sellers and service businesses a named accountant who treats the PayPal balance as a clearing account, posts gross receipts, fees, refunds and disputes, tracks holds and reserves, converts multi-currency balances at the right rate, and matches every withdrawal to the bank in QuickBooks Online or Xero.
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Your subscription, your data
PayPal bookkeeping services from LedgerBPO give online sellers and service businesses a named accountant who treats the PayPal balance as a clearing account, posts gross receipts, fees, refunds and disputes, tracks holds and reserves, converts multi-currency balances at the right rate, and matches every withdrawal to the bank in QuickBooks Online or Xero.
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Inside your file
PayPal balance run as a clearing account that reconciles to the statement
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Reconciled on a calendar
Fees, refunds, disputes and holds posted from the activity download
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Reviewed before you see it
USD, GBP, EUR, CAD and AUD balances kept apart and converted correctly
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A named accountant, a backup and a team lead
Inside your own software, on a fixed close calendar, with a reply from a person within 1 business day. Call +1-657-777-0006 or start a quote.
Get a custom quote 06 / 06
Why businesses on PayPal outsource
PayPal money does not behave like bank money. Receipts sit in a balance, part of it may be on hold or in a reserve, fees come out per transaction, refunds return only part of the fee, and a customer in another country pays into a separate currency balance. When the owner finally withdraws to the bank, one transfer covers weeks of activity. Booking that transfer as income is the most common error we find.
A dedicated accountant runs PayPal as a clearing account. We download the activity file, post gross sales, fees, refunds and disputes in the period they happened, track held and reserved amounts as yours but not yet available, and match each withdrawal to the bank. The balance in the books then agrees with the balance on screen, every month.
What we do inside PayPal
Clearing account reconciliation
The PayPal balance is set up as its own account in the ledger. We reconcile it to the PayPal statement or activity download each month so the closing balance agrees to the cent.
Fees, refunds and partial fee returns
Transaction fees, fixed fees and currency conversion charges are posted from the activity download, and refunds are recorded with the portion of the fee PayPal keeps.
Holds, reserves and disputes
Payment holds, rolling reserves and open disputes are tracked as restricted balances, then released or written off when PayPal decides the case.
Multi-currency balances
Each currency balance is kept as a separate ledger account, conversions are posted at PayPal's applied rate, and the difference to your book rate lands in foreign exchange gain or loss.
PayPal Invoicing and Checkout matching
Invoices sent from PayPal and Checkout payments from your website are matched to the sales invoice or order in the ledger so receivables clear correctly.
Withdrawals and Working Capital
Standard and Instant Transfers to the bank are matched to the clearing account, and PayPal Working Capital repayments deducted from sales are posted against the loan.
Integrations we reconcile
- QuickBooks OnlinePayPal bank feed or app connection reviewed so summary entries, not individual lines, hit the ledger, with the balance reconciled monthly.
- XeroPayPal feed set up per currency balance and reconciled against the PayPal statement.
- ShopifyPayPal orders matched between the Shopify payout report and the PayPal activity download.
- StripeCard and PayPal receipts for the same store kept in separate clearing accounts and reconciled on their own cycles.
- WooCommercePayPal orders from WooCommerce matched to the activity download so order totals and PayPal receipts agree.
Migration to and from PayPal
Moving to PayPal
Taking PayPal live on a store or invoicing flow starts with the ledger design. We create the clearing account and one account per currency, decide whether the bank feed or a connector such as Synder posts the activity, set the accounting date to the transaction date rather than the withdrawal date, and reconcile the first month by hand to prove the mapping works.
Moving from PayPal
If you are moving customers to Stripe or a merchant account, PayPal winds down over months because of holds, open disputes and refunds on old sales. We reconcile every remaining balance, track reserves until they release, download the full activity history for your records, and close each currency balance at zero before the account is shut.
Common PayPal reconciliation problems we fix
Withdrawals booked as sales
A bank transfer from PayPal is net of fees and refunds, and covers many days of activity. We post gross sales and expenses from the activity download and match the withdrawal as a transfer.
Balance in the books never matches the screen
Holds, reserves, pending refunds and open disputes explain most of the gap. We track each restricted amount separately so the reconciled balance agrees with PayPal's available and pending totals.
Currency balances lumped into one account
Mixing GBP, EUR and USD in a single ledger account creates false gains and losses. We hold each currency in its own account and post conversions at the applied rate.
Fees never claimed as an expense
When the net amount is posted as income, the fee disappears. We post fees on every transaction so the expense is complete and the margin is right.
Refunds and chargebacks in the wrong period
A refund on a sale from last quarter hits the balance today. We post it against the original customer and note the period so revenue reports are restated where needed.
Other payments & e-commerce platforms
Frequently asked questions
Do you work inside my existing PayPal Business account?
Yes. You grant our named accountant secondary user access limited to viewing activity and downloading reports. The account, the linked bank and the withdrawal settings stay with you. We do not send money, issue refunds or change settings unless you ask in writing and approve each action.
How much do PayPal bookkeeping services cost?
Pricing depends on volume and scope, so we send a custom quote within 1 business day. The main drivers are monthly transaction count, how many currency balances you hold, whether disputes and refunds are frequent, and whether PayPal is reconciled inside a full bookkeeping engagement or as a stand-alone payment processor reconciliation.
Why does my PayPal balance never match my books?
Usually because holds, reserves, pending refunds and open disputes have not been recorded, or because withdrawals were posted as income. We reconcile the balance to the PayPal statement each month and keep restricted amounts in their own accounts until they release.
How do you handle multi-currency PayPal balances?
Each currency balance becomes its own ledger account. Conversions are posted at the rate PayPal applied, and the difference from your accounting rate is recorded as foreign exchange gain or loss. Withdrawals in a non-base currency are matched to the bank at the amount received.
Can you clean up years of unreconciled PayPal activity?
Yes. We download the full activity history, rebuild the clearing account month by month, post fees, refunds and disputes in their correct periods and reconcile to each withdrawal. This is quoted as a bookkeeping cleanup project before the monthly service starts.
Do you handle PayPal for UK, Canadian and Australian businesses?
Yes. The same clearing account method applies, with VAT, GST or HST posted on sales and fees treated under each country's rules. For Australia the reconciled figures go into BAS workpapers prepared for your TPB-registered BAS agent or accountant; we do not lodge the BAS.
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