Reconciling PayPal Orders with Hyve Post to Xero

Overview

Reconciling PayPal is different from other gateways because Xero connects directly to your PayPal account. Sales, refunds, and fees are imported automatically into Xero via the PayPal bank feed.

How it Works

• Orders are Posted: Hyve posts each PayPal order to Xero as an invoice and marks it as paid.
• Payment Allocation: The payment is allocated directly to your PayPal Bank Account in Xero.
• Fees: PayPal fees are supplied directly by Xero through the PayPal bank feed. Hyve does not calculate or post PayPal fees.

Recommended Xero Setup

To automate PayPal reconciliation, your PayPal account must be connected to Xero as a bank feed.

1. Connect the Bank Feed: In Xero, go to Accounting > Bank Accounts > Add Bank Account and select PayPal. Follow the prompts to log in and authorize the connection.
2. Map the Gateway: In the Hyve app settings, ensure the PayPal gateway is mapped to the same PayPal Bank Account you just connected in Xero.

How to Reconcile PayPal Transactions

Once the bank feed is active, transactions will appear in the Reconcile tab of your PayPal account in Xero.

1. Reconciling Sales

When a customer pays via PayPal, a "Money Received" line appears in the PayPal bank feed.

• Xero will usually find a match to the invoice/payment created by Hyve.
• If the line turns green, click OK to reconcile.
• If it does not match automatically, use Find & Match to locate the invoice payment.

2. Reconciling Fees

PayPal fees appear as separate "Money Spent" lines in the PayPal bank feed. These are not linked to individual invoices.

• To Reconcile: Use the Create tab or a Bank Rule to code these lines to your Bank Fees or Merchant Fees expense account.
• Reconciling these fees ensures your PayPal balance in Xero matches your actual PayPal statement.

3. Reconciling Transfers to your Bank

When funds are transferred from PayPal to your business bank account:

1. In the PayPal bank feed, use the Transfer tab and select your main business bank account.
2. In your Main bank feed, match the incoming deposit to that transfer transaction.

Frequently Asked Questions

Do I need to enter a PayPal fee schedule in Hyve? No. PayPal provides exact fee amounts directly to Xero via the bank feed. Hyve does not calculate or post PayPal fees, which prevents rounding discrepancies.

Why does my PayPal balance in Xero not match my actual PayPal balance? This usually occurs when:

• Fee transactions have not been reconciled.
• A PayPal withdrawal/transfer was coded as "Income" instead of a "Transfer."
• Ensure all fee lines are reconciled to an expense account and all withdrawals are recorded as transfers.