Most eBay refunds are taken from your seller balance as part of eBay Managed Payments but occasionally if your seller fund balance does not cover the cost of the refund then eBay will charge your card or bank account on file directly for the refund amount.

Does Link My Books account for these refunds?

Yes. When a refund is charged to your card or bank account on file eBay include two transactions in the payout report for the period the refund occurred in.

The first transaction is the refund itself, including any refunded eBay fees too:

In this example, the refund minus the fee credits comes to £421.49 which is equal to the amount eBay took from your bank account, see below.

The second transaction is the credit for the funds taken from your bank account:

Importantly this account transfer amount will be allocated to your chosen eBay Dispute Reserved Balances account and tax rate, which is "eBay Dispute Reserved Balances" and "No VAT" if you use our default accounts and tax rates.

How do I reconcile the refund charge on my bank account or credit card?

The refund itself is accounted for in the invoice/journal Link My Books created for the eBay payout. Still, there are two actions to take to reconcile both the deposit from eBay covering the payout containing the refund and the charge to your bank account directly for the refund.

Firstly you will reconcile the amount received into your bank account for the full payout value against the invoice/journal entry created by Link My Books for that payout as normal.

Secondly, to account for the refund charged directly to your bank account you will need to create an expense transaction and assign that to your eBay Dispute Reserved Balances account, and ensure that it has the same No VAT tax rate selected (if you use the Link My Books default accounts and tax rates).

This will ensure everything is where it should be, all accounted for and both the payout amount and refund charge have been reconciled.

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