To reconcile the Stripe invoices ScaleXP creates in Xero against your Stripe payments, add your Stripe account as a bank account in Xero.
1. Add Stripe as a bank account in Xero
- In Xero, select Add Bank Account from the Bank Accounts options.
- Search for Stripe to connect.
- Sign in to Stripe and select the appropriate Stripe account.
- Xero will automatically offer to create a Stripe bank account for each Stripe invoice currency.
- Click Finish to view your new bank accounts.
Initially you will see a nil balance and no transactions; new transactions will be picked up as payments are made in Stripe going forward.
Note: Stripe does not refund payment processing fees.
How it works
When using ScaleXP's Stripe integration with Xero, you are effectively replicating the Stripe invoices in Xero. As a result, the invoices increase your Accounts Receivable.
When the integration creates the invoices in Xero, it brings in important details like Customer Name and Email which Xero then attempts to automatically reconcile against the invoices. There may be some invoices that are not automatically matched and need manual matching.
Since Stripe maintains a balance of funds on their platform for your shop, they act like any other bank account for your business. As a best accounting practice, you'll want to create a new bank account in Xero to reflect the funds Stripe holds. When Stripe transfers funds to your actual bank account, you'll simply "transfer" those funds in Xero from your "Stripe Funds" bank account to your actual bank account.
Rather than recording Stripe funds in an Undeposited Funds account in your chart of accounts, we recommend setting Stripe up as a bank account in Xero. Because you'll be paying for expenses like payment processing fees, issuing refunds, etc. all from this specific account, it acts more like a real bank account than simply a place undeposited funds are held.