I’m trying to learn how to use Dolibarr so I can implement it in my business. The issue that has me stymied now has to do with accepting credit card payments.
When a client pays us with a credit card, PayPal processes the payment and deducts their fee (usually 2.9% plus $0.30) at the time of the transaction. Therefore, we never receive more than 97.1% of the payment. In our current accounting system, we accommodate this reality by splitting the payment: The fully payment credits the income account (editing in our case), but the reduced amount debits our PayPal account. The reminder debits our Service Charge expense account.
I see that I can implement something similar in Dolibarr by editing the ledger entry after the payment is journalized. However, those edits are not carried over to the PayPal account. Therefore, I have to make the same edit in two places (once in the ledger and once in the PayPal account). Of course, this opens me up to the risk of misentering the numbers or forgetting to do it entirely. What is the proper way to handle the service charge?
When you make a payment of 100 euros with paypal, you think you receive only 98 euros. But in fact you receive all the money, so 100 euros. Then paypal charge you, as a supplier of 2 euros. So you should have a customer invoice of 100 euros with a payment of 100 euros, and then you should have a vendor invoice with the amount of the paypal charge and a payment of same amount. To avoid to enter a vendor invoice each time you make a sale, good practice is to enter the vendor invoice with all charges of paypal for all customer invoice of the month at end of month (or at end of quarter). Paypal web site can give you this information.
Yes, I understand that one can think about it that way. An equally valid way to think of it is that PayPal provides a conduit through which my clients’ payments pass, like a toll road or a wire transfer, and only the 98 euros makes it all the way through the conduit. Regardless of how we think about it, the end result is that I have 98 euros and my client has paid 100 euros.
Thank you for suggesting the vendor invoice idea as a way to handle this situation. I can see how that would work. In fact, it would much more closely reflect the case of a more traditional merchant account where the full payment is applied to the account and then the fees are deducted daily, weekly or even monthly.
However, given that I have no other reason to use vendor invoices at all, I would prefer to avoid them completely. If I have to do it, I can and will. However, I plan to continue investigating my other options. For example, after writing my last message, I discovered that I can create a separate transaction in the bank account and it gets properly reflected in both the bank account and the journal/ledger system. I will continue to try that out unless I find some problem with it.
For what it’s worth, given the way PayPal works, I think it would be very inconvenient to create a single monthly invoice reflecting all the fees for that month. First, the fees are not aggregated on the PayPal website, so I would either have to manually add up all the numbers or I would have to create an invoice with as many as 100 line items each month. Second, the balance reflected in Dolibarr would be inaccurate all month long while I waited to produce that one monthly invoice. It seems much more convenient to deduct the fee at the time it is applied by PayPal.
I’m looking into implementing vendor invoices for our PayPal fees as suggested by eldy. My current problem is that I see no way to add a vendor in the Third Party tab of Dolibarr. I have only Customer and Prospect as choices. Should I look somewhere else? Do I need to enable vendors somewhere? I have looked in the Setup gear for the Third Party module. I looked through the wiki, but found nothing so far.
Ok. I discovered why I could not add any vendors: I had not enabled the Vendor module. I’ve done that and looked through the Setup gear for the Vendor module. I was able to create a draft invoice with a service on it. However, I am not able to complete the invoice. When I click Validate and Approve, I get a message in the upper right corner in a red box that says “Module/Application not configured.” What else do I need to configure?
Maybe a good aproach is adding a feature in the current “ENTER PAYMENT” process of an invoice (vendor&customer), to have the chance to detail the ammount of the bank/paypal fees.
If each time we receive a payment of a customer or we perform a payment to a vendor, now we only etail de ammount received/payed, but we can not deytail the bank fee.
Adding this feature to detail the bank fee, then in each payment we can perform two updates with this detail:
1)Add the bank entry in our account (bank account or paypal account)
2)Add a line with the “bank fee” in a exisitng vendor purchase order of Paypal (for example: yearly paypal fees purchase order), in a similar way that Eldy proposes.
This way every payment will update a Paypal purchase order, and the bank entry of our bank account in Dolibarr.
Having the purchase order updated, we can decide anytime to validate the purchase order, and transform it in a Paypal invoice, classified as “already payed”, with a lot of small micro-payments.
Then in next payment to perform a ne purchase order will be necessary to be created, to continue adding lines.
This way, customer/vendor invoice will be classified as 100% payed, the bank entry will be updated properly, ready to reconcilie it, and the vendor invoices of Paypal will be generated accordingly (Keep in mind that in a lot of countries, the bank fees have also VAT taxes, that need to be detailed in an invoice by the bank/Paypal as a supplier of services)
Currently, I am facing the same problem, just with Stripe payments.
I understand the original rationale to register full payments for each customer invoice and then register the cumulative Strip/Paypal fees once a month when they provide the monthly statement with the overall transaction fees.
Unfortunately, at least with the Stripe account, the fees are already deducted from the account balance after each transaction. And ifthe Stripe account is handled in the accounting system like a bank account, the balance in the accounting system needs to be identical with the balance that Stripe is showing in their reports at any point in time.
So I think, at least in the long term, we need a way to capture the payment fees and generate a fee related transaction for every payment transaction. The good news is, that this data is already available from Stripe per transaction, it just needs to get recorded as a bookkeeping transaction. (Side node: Stripe is registered in Ireland, therefore for the VAT on the fees reverse charge applies, which adds a little extra burden onto the fee transaction).
Since I am currently planning to export the Dolibarr accounting data into a main accounting system for further processing, maybe even an export of the fee from the Banking Section/Stripe Account/Transaction Overview table (development feature, only visible at level 1) would suffice.
My question: Has anybody else already looked deeper into this, maybe even from a German accounting perspective (which should not differ much from general rules in this case)? Is there an export feature for the Stripe data already available somewhere? Otherwise I will probably build something based on the existing exports.
Hello. Can you please provide peer review for this? I am currently learning Dolibarr and want to document processes for FAQs. Can you validate that the process below is correct?
Your process looks good. As you said, there is several way to manage things, but the one suggested looks a common and good way.
As i am concerned, i named the bank account “Undeposit fund” into “Paypal wallet”.
