Wave Payments and Stripe Payouts

DougDoug Member Posts: 3

I issued an invoice for $40 and a client paid it using Wave Payments which was fine.

Wave Payments created a transaction of $39.09 ($40 minus the $0.91 Stripe Processing Fee). But when it came time to pay out of Stripe, I received $39.00 - Stripe took an extra $0.09 in tax fees as well. In my transactions list I have two differing payments for the same invoice.

This has created a difficulty with my reporting as well, because in my Sales report both the full invoice payment of $40 and the Stripe payout of $39 are being included, so the same transaction is being counted twice in my case.

I am not sure what to do in this case to make everything reconcile together properly? I can't add that additional Stripe tax of $0.09 to the transaction created by Wave Payments and I think if I could it would solve a lot of my problems.

Edit: I think Stripe's total fee is $1 ($0.91 Processing payment + $0.09 tax as I'm in Australia and that according to Stripe is the GST component) - how can I have Wave update to recognise this as a tax that Stripe will continue to take out in the future?

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edited May 11, 2018 in Technical Support
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Comments

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi @Doug.

    You're right with your update, Stripe charges GST on their merchant fee for Australian users. You can read a bit more about it here.

    My recommendation here would be to create a transaction to adjust the amount. You'll just have to create an expense transaction from the account with the extra $0.09 for that amount and choose your GST account as a category. This will add it as taxes paid on your reports, and make sure everything reconciles.

  • DougDoug Member Posts: 3

    Thank you Alexia,

    That will help with reconciliation but I don't think that will solve my reporting problem. I still need to link the Stripe payout with the Wave Payment transaction. I will have to to do some more thinking.

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @Doug.

    Ultimately, your transactions should look like this:

    • $40 income for paying your invoice
    • $0.91 for merchant fees
    • $0.09 for taxes on merchant fees

    You might have to mess around with a few numbers to make sure everything looks at it should, but this should be your target. I'll be bringing this up on my end to see if we can make this process smoother, so thank you for bringing it up!

  • DougDoug Member Posts: 3

    If I can get that set up I think it will solve my problems. What I want to have happen is point 3 from here: https://support.waveapps.com/hc/en-us/articles/115004964423-Bookkeeping-Changes-to-Payments-by-Wave

    Once the bank-imported transaction is pulled in, Wave will automatically create a transfer between your Payments by Wave account and your bank account. That transaction represents the movement of funds from the holding account to your bank account.

    The automatic creation of a transfer is not happening at this time, and unless I can add that extra $0.09 to the Wave Payments transaction I don't think I can do it as they won't match up.

    Thank you for passing this along, I'm enjoying using Wave but this makes the process of getting paid through Wave a bit more complicated.

    edited May 11, 2018
  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @Doug.

    That's what I thought the issue was. I'll make sure to bring it to the attention of the right folks here and find out the best way to handle this.

  • FionaFiona Member Posts: 3

    I'm new to Wave and have just come across this problems as well. The current solution you have suggested here is far from ideal. If your team could figure out a way to handle this more smoothly it would be greatly appreciated :smile:

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @Fiona.

    We're working on it! I can't give you an exact timeline for when it'll be fixed, but it absolutely is a frustrating issue to have and our engineers are looking into a solution.

  • DannyDanny Member Posts: 6

    I'll just comment here that I have the same problem (also in Australia) and will be watching for a better solution. Cheers.

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Thanks for letting us know, @Danny! I'll add your comment to the report on our end.

  • DannyDanny Member Posts: 6

    At present I am manually adding an expense for the gst amount charged by stripe and then clicking add sales tax, change the amount of gst to the full amount and attaching to "payments by wave" account. This seems to get the accounts to balance properly but would be good if was automatic.

  • benAUbenAU Member Posts: 5

    I'll chime in too! I sent a message to support about this in February: Request #690910

    and was told there was no timeline for the issue to be resolved. I just wondered if it was possible to even get a rough idea?

    In Australia our financial year just ticked over on July 1 and I left my Stripe payments as they were (with the missing tax) hoping that the problem might be fixed before my tax return needs to be submitted.

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi @Danny and @benAU.

    I understand that it's frustrating, especially when dealing with the end of your financial year, but even taking into account a resolution, those transactions wouldn't be created retroactively. I'm not certain how those transactions appear on the reports you can get from Stripe, but if those taxes appear on their own column, you should be able to add them up easily and add as a single amount through a journal transaction (which would be against Sales).

  • benAUbenAU Member Posts: 5

    HI Alexia!

    It's okay! It more of an OCD issue! Just having Wave to keep things organised it great.
    I just wondered if the solution was close before I started making manual corrections.

    Thanks for the quick reply!

    ;-)

    edited August 8, 2018
  • Micomp_SuppMicomp_Supp Member Posts: 1

    I have been dealing with this issue for years but it's not a big deal when you are aware of it. Add 10% to the value of the wave payment fee recorded.Then allocate GST in the taxes box to the wave payment fee expense and finally delete the Stripe import transaction to to prevent doubling up for account reconciliation. It's a bit of a pain that it isn't automated but then we are a pretty small market in Australia for a company that is giving away free bookkeeping software that's saved me thousands over the last few years.

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @benAU and @Micomp_Supp.

    Thanks for adding to this discussion to you both! We really appreciate your patience in this matter. We are taking this issue seriously, regardless of the size of the Australian market. Wave being free isn't an excuse for us to offer anything less than a stellar piece of software :)

  • aussie_waveaussie_wave Member Posts: 1

    Hi @Alexia,

    I'm stuck on this too in Australia. Have tried to work around this, I can't get my first payment to reconcile due to the tax on merchant fee. I have tried what others have suggested but can't seem to get it to work. It would be good to be able to Edit the Transaction Details for the Invoice Payment by adding another Category.

    Currently I have showing on the Invoice Payment;
    Category 1 is Payment from Customer $100
    Category 2 is Merchant Account Fees -$1.86

    Pretty please, can you allow to edit and add Transaction Details ?
    Category 3 - Tax on Merchant Fee -$0.19

    This simple edit will allow me to reconcile and balance my account. Without this, wave accounting system won't make much sense in Australia if it can't factor in tax for online payments.

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @aussie_wave.

    As mentioned in my earlier replies, we're working on resolving this issue, so that the calculation is automated. For the time being, you'll have to add the tax to the merchant fee manually. You can just add this as an expense for $0.19 categorized to your GST account.

  • benAUbenAU Member Posts: 5

    Hello again @Alexia!

    I'm just starting to clean these Stripe payments up and I'm a little bit confused trying to follow the suggestions in these posts.

    Q1) I don't have to track GST because I'm under the threshold. Should I add a GST sales tax in Wave so I have the GST account (even if it's only used for putting the Stripe tax somewhere?) or should I just create an account/category manually?

    Q2) @Micomp_Supp says to allocate the GST in the Taxes box? I'm not sure exactly how to follow the process.
    I can't see a way to add tax to anything in the "Payments by Wave" account. Everything is locked.
    Should I be recreating the imported transaction from the bank and splitting off the GST to a GST account, or adding an expense to the "Payments by Wave" account with Stripe tax amount?

    (sorry if the answer is straight forward -- I'm just confused about the "right way" to work around this)

    Thanks,
    ;-)

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @benAU,

    You can absolutely just do this by adding an expense to the Payments by Wave account. The best way to do this is to create the GST as a sales tax from the Sales Tax page in your Settings. If that tax is recoverable in Australia, make sure to mark it as such (there's a checkbox).

    Once that's done, create an expense to Payments by Wave for the amount in taxes charged on the merchant's fee and categorize it to your GST account. That's all you'll have to do.

  • benAUbenAU Member Posts: 5

    Hi @Alexia,

    Awesome! Thanks for clearing that up for me!

    ;-)
    Ben

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Let me know if you run into any issues, @benAU, I'll be happy to help out.

  • StevieStevie Member Posts: 2

    I'm having the same issue. Hopefully the Wave team has a fix soon.

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @Stevie,

    I hope so as well! I can't offer a timeline, but I can tell you that our engineers are on the case.

  • guustguust Member Posts: 6

    Actually, the solution should be pretty "simple" I think.
    A transaction is already allowed to be split. If the transaction can be split into an income and an expense account, then you can add the full customer payment in full as the income [and apply tax if required], and then the expense should pick up the difference between the full customer payment [and apply tax if required].

    Example: Sell a widget for $110. Receive S105.60 from Stripe.
    Split the transaction into Sales and Stripe fee.
    Enter $110 for sales and get GST auto-calculated as $10.
    The expense could then be auto-calculated as $110 - $105.60 = $4.40.
    Get GST auto-calculated as $0.40.

    So the only change required is for a transaction to be split into an income and expense account.

    Thanks

  • AlexiaAlexia Administrator Posts: 3,315 admin

    Hi, @guust, thank you for adding to this discussion. I'll pass your feedback along.

    I can't speak to how difficult this is to implement, as I'm not a developer myself. There is a bit more to it than just calculating the amount, however. Everything has to be synced with our integration with Stripe, as this issue applies to a few different countries.

  • wiredafricanwiredafrican Member Posts: 7

    Perhaps I'm missing something, but this is how I currently handle these transactions in Australia. The solution was provided by Wave Support.

    Step 1: Move the payment and wave merchant fee transaction dates to the same date the Stripe deposit transaction came into the bank account. i.e. they all align to the cash into bank account transaction date (usually this is about 2-3 days in Australia so is usually insignificant i.t.o account periods)

    Step 2: Adjust the Wave fee amount to equal Payment Amount less Deposited amount.

    Step 3: Mark the Wave fee for GST in the transaction drop down so it takes GST into consideration on the merchant fee. It will account for the GST on the Wave/Stripe merchant fees.

    Step 4: Delete the Stripe cash deposit transaction.

    This will effectively see a reconciled bank balance on the date of the Stripe deposit - recon'd to bank cash flow and you've accounted for GST on the merchant fees.

    Hope this helps because it works well for us.

    edited October 3, 2018
  • doniusdonius Member Posts: 1

    I am in the U.S. any although I don't deal with GST, I still need to reconcile the fact that I end up with two incomes. The invoice amount and the fee are separated into two transactions, then when the money is transferred to the account, I get another transaction for the actual amount (invoice minus the fee). For now, I've just been going in and deleting the transaction from the bank, because it doesn't balance properly. Is t here a better way? I think based on what I've read here is there probably isn't right now. I'm interested to know if I should just create a separate transaction to balance it out rather than delete the bank transfer transaction.

  • wiredafricanwiredafrican Member Posts: 7

    donius I think it would be much easier just to delete the Stripe deposit transaction after changing the dates of the other two transactions. Creating a separate balancing transaction to reverse the deposit transaction would take much longer to do and cause more effort for you to recon your bank account.

  • davedaylesforddavedaylesford Member Posts: 1

    I am in the same boat and cannot fix the issue.
    The invoice payment that was automatically created by Wave cannot be edited as it is locked. Therefore it cannot be matched to the actual payment received by Stripe. Therefore Wave will not "_ create a transfer from payments by wave to my connected bank account"_ as it says it will in the the "fearless accounting with wave guide". So when I look at my balance Sheet, there will always be an amount in 'Payments by Wave Account' rather than in my bank account.

    Is there a way to manually create a transfer from the Payments by Wave Account, into my Bank Account? At least this way I can make the books look accurate.

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