You can reconcile PayPal transactions/statements in minutes with QuickBooks Online using PayTraQer.
It is always better to follow the industry's best approach to avoid the reconciliation nightmare.
Follow the steps to Reconcile PayPal account in QuickBooks Online
1) Setup QuickBooks Online for Reconciliation:
Step 1: Create a Bank Account named "Paypal Bank Account" (or name it as needed) in QuickBooks Online. This account will be used to record your PayPal sales & PayPal fees.
Step 2: CHECKING ACCOUNT/CURRENT ACCOUNT should not be used directly to record your Paypal sales as it will create numerous issues in reconciling the Paypal fees.
Step 3: Setup the bank feeds in QuickBooks Online or upload the Bank Statement in QuickBooks Online. The downloaded transactions will be available in the bank review section.
2) Setup PayTraQer
Step 1: Connect PayTraQer with your QuickBooks Online (How to?)
Step 2: Connect PayPal with PayTraQer (How to?)
Step 3: Configure the sync settings for Sales, Expense, Fees, Items & Payout (How to?).
Step 4: Record (Sync) the transactions from Paypal to QuickBooks Online (How to?).
While providing the settings, you need to select the same bank account ("Paypal Bank Account" or created Bank Account) for Sales, Expense, Fees, Items & Payout.
Configure PayPal Sales settings with your PayPal Bank Account
Configure PayPal Fees settings with your PayPal Bank Account
Configure PayPal Expenses settings with your PayPal Bank Account
Configure PayPal Payout settings with your transfer sales account
3) QuickBooks Online Bank Review
Step 1: Navigate to the Banking Section in QuickBooks Online, you could see that the TRANSFER transactions of "Paypal Bank Account" is matched against your deposits. These TRANSFER transactions won't be created if you have not enabled Payout processing in PayTraQer.
Step 2: Click the "Match" link to accept the transactions.
You can also create TRANSFER transactions directly in the Bank Review screen if it is not available.
4) QuickBooks Online Reconciliation
Step 1: Navigate to the bank reconciliation page in QuickBooks Online.
Step 2: Provide a statement balance amount and statement date.
Step 3: Start the Reconciliation Process.
QuickBooks Online automatically matches the transfers and deposits and marks the transactions as reconciled. Now QuickBooks Online Paypal sales ( Invoices, Sales Receipts) and Paypal Expenses (Fees, Expenses) are properly matched with your checking account.
