How Should I Record Shopify, Etsy, Amazon, or Other Online Sales?

Short Answer: Your bookkeeping should generally record your gross sales, then separately account for refunds, discounts, processing fees, marketplace fees, sales tax, shipping, and other amounts deducted before the platform deposits money into your bank account.

The amount deposited into your bank is often not the same as your actual sales revenue.

Why This Matters

One of the most common e-commerce bookkeeping problems happens when businesses record only the deposits they receive from a platform.

For example, a platform might collect $5,000 from customers but deposit only $4,500 after subtracting fees, refunds, and other charges.

Recording only the $4,500 deposit can understate both revenue and expenses.

Common Mistakes

Recording bank deposits as total sales
Ignoring payment processing fees
Double-counting revenue from accounting integrations
Recording sales tax as revenue
Forgetting refunds and chargebacks
Combining several selling platforms without reconciling them
Assuming the platform's dashboard automatically matches the accounting records

Harvest's Recommendation

Reconcile each sales platform regularly.

Your records should allow you to move logically from:

Gross customer sales → adjustments and fees → net platform payout → bank deposit

When those numbers reconcile, it becomes much easier to trust your financial statements.

Good to Know

The IRS emphasizes keeping records that clearly support business income and expenses. Your recordkeeping system can be electronic, but it should provide an accurate history of business transactions.

This becomes especially important when multiple payment processors and marketplaces are involved.

When It's Time to Get Help

Consider getting accounting help if: