Explaining GoCardless and Stripe payments in your accounting software
Where multiple payments are taken on the same date, GoCardless or Stripe will group these payments together, deduct its transaction fees, and make a single payment into your bank account. This article explains how to deal with these transactions in your accounting software (e.g. Xero, Quickbooks, Sage, etc).
Option 1. Assign to a single account code
If your income is all of the same type, for example membership subscriptions, the simplest approach is usually to create a contact in your accounting software called something like 'GoCardless membership fees' and associate all income transactions with this contact. Most accounting packages will allow you to set up an automatic rule that will automatically assign incoming transactions to this contact and the appropriate account code.
Option 2. Assign to multiple account codes
If your income is a mix of membership subscriptions and donations, it is usually best to create a different contact for each account code and payment gateway, for example 'Stripe donations' and 'GoCardless membership fees'. You will then have to manually check each incoming payment from GoCardless and Stripe and divide it as appropriate between these different contacts, each with their appropriate account codes.
Option 3. Replicate all contacts and invoices
In some cases you may wish to replicate all contacts and invoices in your accounting software. This can be done by exporting a list of invoices from White Fuse and importing this list into your accounting software. During this process you may have to add certain additional information, such as tax status.
The advantage of this approach is that you get a more accurate and granular picture of contact-level activity in your accounting system. This is particularly useful if you need to issue tax invoices to customers or meet additional invoicing requirements such as adding purchase order numbers.
The main disadvantage of this approach is that it creates additional manual work. You will need to manually reconcile the incoming payments from GoCardless and Stripe with all of the invoices they relate to, recording payment fees as part of this process.
We are considering building integrations with Xero and Quickbooks that will automatically synchronise contacts, invoices, payment statuses and payment processing fees. This is a significant undertaking so we are keen to learn as much as possible about each of our customer's needs in advance. If this feature is of interest to you please get in touch to let us know.