How to Reconcile Stripe Payments in QuickBooks

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The latest in personal finance to help you make smarter money choices. 

Reconciling Stripe payments on QuickBooks is overly complicated. 

SaaS companies need a faster way to handle Stripe payments.

In this article, you’ll learn how to do it manually, which can be quite hard, but we’ll show you step-by-step. Let’s get started.

Table of Contents

What Is Payment Reconciliation? 

Payment reconciliation is the process of matching transactions in your bank accounts to your bookkeeping records. This helps you to see what’s going in and out and spot any missing funds.

You’ll have to do this with your Stripe accounts. If you’re using QuickBooks, you’ll want to reconcile your Stripe payments there to keep all your accounting records in one place.

How Payment Reconciliation Works

Your payment reconciliation process should happen regularly, usually monthly or quarterly.

During this process, your financial team needs to verify that every transaction across each bank account and payment processor matches your records. 

This means checking every sales receipt, bank deposit, credit card transaction, etc., for each payment method. You’ll also need to look out for undeposited funds, payment processing fees, and refunds. 

That way, you can match each payment or expense to a record to make sure the total funds tally with what’s going in and out.

You can do this manually by checking every bank statement, credit card statement, checking account, and expense account by hand. You’ll need to match every transaction to its receipt or invoice to account for all incoming and outgoing money.

However, manually reconciling your account is a lengthy task. After you’ve gone through the bank reconciliation process, you’ll need to repeat this manual procedure for every payment gateway you use, such as Stripe or PayPal. 

You can use accounting software like QuickBooks Online (QBO) or Xero to speed up the reconciliation process. 

Accounting software not only helps you view all your records in one place, but it’s also easier to search through them without having to sift through paperwork by hand.

Automated payment reconciliation speeds up the process even more.

Take Rise Vision, for example. By using an automated platform, they were able to reconcile their numbers in half the time.

Since automation is faster, it’s also cheaper. Fewer labor hours are needed to go through accounts and match records as automated platforms do it for you. 

Why Is Payment Reconciliation Important? 

Payment reconciliation is a vital part of accounting. It’s the process of confirming that records are correct and true.

There are a few reasons why this is necessary.

  1. Accurate tax reporting. When companies report incorrect taxes or underpay taxes, they face the prospect of huge fines. Payment reconciliation ensures that all your tax reports are correct and up-to-date so that you send accurate data and payments to the tax authorities.
  1. Prevent identity fraud and theft. The bank reconciliation process gives your financial team an opportunity to check all payments going out of each bank account and payment platform. This enables them to identify unauthorized transactions, undeposited funds, and suspicious activity. 
  1. Validate data. By frequently reconciling transactions, you can pick up on any accounting discrepancies regularly. Otherwise, you’ll end up having to validate all your data at once when you get audited.
  1. Confirm financial statements. While it’s rare, banks and payment platforms sometimes make mistakes. Only by taking the time to reconcile each payment will you be able to pick out these mistakes if they occur.

How To Reconcile Stripe Payments in QuickBooks Manually

If you’re using QuickBooks Online and accepting Stripe payments, you may be struggling to reconcile your transactions.

That’s because the manual process is complex, clunky, and cumbersome.

Follow the steps below to find out how to match your Stripe transactions on QuickBooks Desktop or QuickBooks Online.

1. Create a Folder Structure for Saving Your Reports

First, you need to build a folder structure on your hard drive so that you can save and access your Stripe reports as you go.

Try something similar to:

  • Stripe Reports (Main folder)
    • Stripe Transaction Details (sub-folder)
    • Stripe Payouts (sub-folder)
    • Stripe Month-End Reports (sub-folder)
    • Stripe-QBO Reconciliation Reports (sub-folder)

2. Log Into Stripe and Download Reports

Once you’ve set up your folders, you need to log into your Stripe account to access the financial records you want to reconcile.

Follow these steps:

  1. Click ‘Reports’ to access all your Stripe reports.
  2. Download the ‘Balance Summary’ and save this in your Stripe Month-End Report folder. You’ll need this report to reconcile your Stripe clearing account in QBO.
  3. Download the ‘Balance change from activity’ report. Save to your Stripe Transactions Details folder as a CSV file. In the download screen, choose the following options:
  • Report format: Itemized
  • Reporting category: All
  • Columns: custom and select all the appropriate fields
  1. Download the ‘Payouts’ report and save the CSV file to your Stripe Payouts folder. Leave the report format and columns setting as the default options.

3. Log Into QuickBooks and Set Up Stripe Account and Service Item

If you haven’t done it already, you’ll need to set up your Stripe account in Quickbooks Online.

To do this, head to the ‘Chart of Accounts’ under the ‘Bookkeeping’ tab. 

Click the green button that says ‘New’ located in the right-hand corner of the window.

This account will act like a clearing account. Fill in the details as follows:

  • Account Type: Bank
  • Name: Stripe clearing
  • Detail Type: Checking
  • Description: Clearing Account
  • Balance as of: Add the current balance and today’s date

Next, you need to set up a service item to account for Stripe fees.

To do this, click on ‘Products and Services’ in ‘Pay and Get Paid.’

Click ‘Add a product or service.’

Add the service item details as follows and leave all other sections blank.

  • Name: Stripe Fee
  • Description: Stripe processing fee
  • Income account: Bank charges

4.  Record Stripe Transactions in QuickBooks Online

Next, you need to record all your Stripe transactions.

Quickbooks has no automatic process to help you upload this data. You’ll need to enter the transactions for each customer manually. 

This means creating a sales receipt for each customer.

To do this, go to your ‘Stripe Transactions Details’ folder and open the ‘Balance change from activity’ file.

Now, head to Quickbooks and click ‘New’ on the right-hand side of the screen in the main menu. Select ‘Sales Receipt.’

In the new sales receipt, fill in the following details:

  • Customer name: Choose an existing customer name or create a new one.
  • Payment method: Stripe payment or card type.
  • Reference Number: Use the transaction ID number from your CSV file.
  • Payment date: Use the ‘created date’ from the CSV file.
  • Deposit to: Choose ‘Stripe clearing.’
  • Line 1: Add the gross sales from the whole CSV file for this customer.
  • Line 2: Add the total of all Stripe processing fees. Write this as a negative number.
  • Save this sales receipt and repeat this process for every journal entry in the CSV file.

5. Record Stripe Payouts

The next step is to record all outgoing payments from your Stripe account. You’ll need to complete a ‘Transfer’ form for every Stripe payout.

Follow these steps:

  • Click ‘New’ in the main menu on your QBO dashboard
  • Click ‘Transfer’
  • Fill in the form as follows:
    • Transfer Funds From: Stripe clearing
    • Transfer Funds to: Choose the account where funds are going
    • Transfer Amount: Add the payout amount
    • Memo: Add the reason for paying out these funds
    • Attachments: Add invoices/receipts/evidence for this payout
  • Click ‘Save’ and repeat this process for every payout on Stripe.

6. Reconcile Stripe Account on QuickBooks

Once you’ve recorded all incoming payments and outgoing transactions from your Stripe account on QBO, you can reconcile these payments so that the balance tallies correctly.

To do this, follow these steps:

  1. Open the ‘Stripe Balance Summary’ CSV file.
  2. Note down the ending balance. This will be the figure you use to reconcile your Stripe accounts.
  3. Head back to QuickBooks and click ‘Reconcile’ in the ‘Bookkeeping’ tab.
  4. Choose to reconcile ‘Stripe clearing.’
  5. Add the end balance from your ‘Stripe Balance Summary.’
  6. Click ‘Start reconciling.’

How To Reconcile Stripe Payments in QuickBooks With Chargebee

If you sell a SaaS product or run a subscription-based company, an automated platform like Chargebee can help you reconcile your Stripe payments with the click of a button.

Once you have Chargebee, QuickBooks Online, and Stripe accounts, follow these simple steps for easier Stripe payment reconciliation on QuickBooks.

1. Integrate Chargebee With QuickBooks

Integrating Chargebee with QuickBooks allows you to synchronize all data for all bank accounts and payment platforms.

You can automatically pull and track invoices and tally your books with your bank statements and payment processor records. 

That way, you can reconcile payments more easily, account for waste, and guarantee that all revenue is accounted for accurately.

Integrating Chargebee with QuickBooks helps you reconcile Stripe payments more easily, and you’ll also find it easier to keep all your books in sync with your recurring payments.

Through QuickBooks, you can generate financial reports, tax liability reports, and file tax returns, simplifying the accounting process.

Watch this video to learn how to integrate Chargebee with QuickBooks.

2. Configure Stripe Payments With Chargebee

Once you’ve integrated Chargebee with QuickBooks, you need to configure your Stripe payments with Chargebee. 

By doing this, your Stripe data will automatically be transferred to Quickbooks via the Chargebee integration.

Follow these steps to configure Stripe with Chargebee:

  1. Head to your Chargebee account
  2. Click ‘Settings’
  3. Select ‘Configure Chargebee’
  4. Choose ‘Payment Gateway’
  5. Click ‘Add payment gateway’
  6. Choose ‘Stripe’
  7. Log into your existing Stripe account (or create a new one if you haven’t already done this)

The page to configure your Stripe account will open. You’ll see a list of different payment types.

Turn on the payments that are relevant to you, choosing from cards, Apple Pay, SEPA, ACH, and ACG credit transfers. Configure each payment method individually.

For each payment type, fill in the form that asks about your business and the data you’ll collect from customers.

3. Reconcile Stripe Payments Without Manually Converting or Importing

With Chargebee’s integration, you can reconcile Stripe payments with accounting software like QuickBooks and Xero automatically with the click of a button.

To reconcile Stripe payments on QuickBooks with Chargebee, you have two options.

One method is to:

  • Download your Stripe statement from Chargebee
  • Match your Stripe statement to the book of accounts
  • Reconcile the payments in QuickBooks

Alternatively, you can download the Chargebee Payment Reconciliation Plugin, which allows you to reconcile your Stripe payments in QBO by clicking one button.