What are Amazon “Deferred” transactions?
Deferred transactions are Amazon orders that Amazon does not include in the current payout. They’re held back and released later. Two common reasons:
DD+7 (Delivery + 7 days): Amazon withholds funds until ~7 days after delivery.
B2B Deferred: Business buyers or specific terms cause Amazon to hold funds longer.
These items don’t show up in the settlement you receive for the current period; they show up in a later settlement when Amazon releases them.
Why do deferred transactions affect your accounting?
If you only book revenue when the payout lands, sales that occurred this month can appear next month (or later). That creates:
Misstated monthly P&L (revenue and fees land in the wrong period)
Lumpy performance (spikes/dips driven by Amazon’s hold timing, not business activity)
Harder KPI tracking (CAC/ROAS vs. revenue goes out of sync)
Good revenue recognition means you book sales, refunds, fees, and taxes in the period the activity happened, not when Amazon decides to pay you.
How Link My Books’ Revenue Recognition feature solves it
Each month, Link My Books automatically finds all Amazon transactions that were:
Deferred in that month
Released by Amazon in that month
Then, for each Amazon marketplace, Link My Books generates two additional “recognition settlements” that look just like normal Link My Books settlements (broken down by Sales, Refunds, Fees, Taxes), but with a different balancing account:
Deferred Settlement (for items deferred this month)
Released Settlement (for items Amazon released this month)
We also split DD+7 and B2B into separate recognition settlements so you can see them clearly.
If you have Cost of Goods Sold tracking enabled we'll also generate COGS Bills for these entries.
Where do these post?
The balance (net) of each recognition settlement posts to the Amazon Deferred Balances account you choose (default recommended is LMB9d: Amazon Deferred Balances). That keeps a clean trail on your balance sheet of amounts Amazon is withholding and then releasing—while your P&L lands in the correct month.
What this achieves
Month of Activity: Sales/Refunds/Fees/Taxes hit your P&L in the month they occurred (via the “Deferred” settlement).
Month of Release: The “Released” settlement clears the prior deferral so the P&L isn’t double-counted when Amazon finally pays out.
Balance Sheet control: The Amazon Deferred Balances account rises when items are deferred and falls when they’re released—mirroring Amazon’s holds.
How to set up Revenue Recognition in Link My Books
Go to Settings → Settlement Settings → Revenue Recognition
Enable Deferred Transaction Adjustments
Choose a start date (the earliest month you want LMB to generate deferred/released settlements from)
Click Save Settings
From the chosen date onward, LMB will create monthly Deferred and Released recognition settlements per marketplace (with DD+7 and B2B split), so revenue lands in the correct month.
Opening Balance
Recognition entries capture monthly movement (deferrals and releases), not the total withheld at month-end.
If you want your Amazon Deferred Balances account to reflect what Amazon is holding at month-end, set an opening balance in Xero/QuickBooks the first month you enable deferred transaction adjustments (use Amazon’s withheld balance as of that date). After that, recognition monthly entries will keep it up to date.
What you’ll see month to month
Normal Amazon settlements continue as usual.
New recognition settlements for each marketplace:
Deferred – DD+7 and Deferred – B2B
Released – DD+7 and Released – B2B
Each recognition settlement shows the familiar Sales / Refunds / Fees / Taxes lines.
The net amount posts to Amazon Deferred Balances.
Sanity check:
Over time, the running balance in Amazon Deferred Balances should approximate what Amazon is currently withholding across marketplaces. As releases happen, that balance reduces.
Simple example (how the numbers flow)
Let’s say in January you have £12,000 of orders that Amazon defers (DD+7). Amazon releases £4,000 of previously-deferred items in February.
January
Deferred (DD+7) settlement posts your Jan Sales/Refunds/Fees/Taxes to the P&L (correct month).
Net increases your Amazon Deferred Balances by the amount Amazon is holding.
February
Released (DD+7) settlement reverses the recognition so your P&L isn’t double-counted in Feb.
Net decreases your Amazon Deferred Balances as Amazon releases those funds and they flow through the normal cash settlement.
Result: P&L shows January activity in January. Your balance sheet tracks the temporary hold and clears it when Amazon releases.
FAQ & best practices
Q: Does this change my deposit reconciliation?
A: No. Your actual payouts still reconcile to your bank/clearing as usual. The recognition settlements route net movements through Amazon Deferred Balances, not your bank.
Q: Which account type should “Amazon Deferred Balances” be?
A: We recommend an Other Current Asset (it represents amounts Amazon owes but hasn’t released). If your accountant prefers a different treatment, follow their guidance.
Q: Multi-marketplace or multi-currency?
A: Link My Books creates separate recognition settlements per marketplace (and splits DD+7 vs B2B). Currency handling follows your accounting platform’s standard conversion on the document date.
Q: Can I backfill historical months?
A: Yes. In Settings → Settlement Settings → Revenue Recognition, enable Deferred Transaction Adjustments and set the start month you want recognition to begin.
Q: My Amazon Deferred Balances doesn’t clear down—should it net to zero?
A: No—that’s expected. Because new orders are deferred every month and older cohorts are released, the balance is a rolling working balance, not something that goes to nil.
It should increase in months where deferrals > releases,
decrease when releases > deferrals, and
generally hover around what Amazon is typically holding (e.g., ~DD+7 plus any B2B holds).
Troubleshooting tips
I don’t see recognition settlements:
Make sure the feature is enabled and an Amazon Deferred Balances account is selected.
Confirm that month actually had deferred or released items.
Balances don’t match Amazon exactly:
Timing differences (document dates, currency rates, Amazon reporting windows) can create small variances. Review by marketplace and by DD+7 vs B2B to pinpoint gaps.
Need a hand?
If you want us to review your configuration or walk through a month-end example, ping support—we’ll jump in and sanity-check your setup.
If you have any questions about this article or feedback on how we could make it better please reach out to the support team via the blue chat icon on the bottom right of the page or via email to [email protected].