TL;DR:
When Amazon can’t pay a settlement, it includes that amount in your next settlement. Don’t roll back your settlements. Instead, move the failed amount to your Amazon Reserved Balances account in your accounting software. The next settlement will bring that balance back to zero automatically.
Why this happens
If a settlement payout fails, Amazon rolls the same amount into the next settlement. This leaves you with a settlement in your accounts that has no matching bank transaction to reconcile against. You should park that amount in Amazon Reserved Balances until the next settlement arrives.
Account to use:
Amazon Reserved Balances — LMB creates this by default as LMB9.
Some customers may have chosen a different account name/code. Use whichever account you’ve configured for Amazon reserved balances.
Important:
Do not roll back Link My Books settlements just because a payout failed. The settlement still contains real sales/fees/taxes that must be recorded.
If you already rolled them back, re-send the settlements from Link My Books to your accounting software, then follow the steps below.
Xero — fix a failed payout (invoice posting)
You’ll have a Xero invoice for the failed settlement with a positive total but no bank transaction to match.
In Xero, open the settlement invoice for the payout that failed.
(Tip: use the "View on Xero" link on the view settlement page in Link My Books)Add a new line to the invoice with:
Description:
Amazon Reserved Balances - Failed to transfer fundsAccount:
Amazon Reserved Balances (LMB9)(or your chosen reserved balances account)Tax rate:
No VATQty:
1Amount: negative value of the failed payout (e.g., if £123.45 failed, enter -123.45)
Update/Approve the invoice.
This moves the failed amount to Amazon Reserved Balances and allows the invoice to reconcile correctly.When the next settlement arrives, you’ll see a positive line on that new settlement invoice with the same description and amount. Reconciling that settlement brings Amazon Reserved Balances back to 0.
Example:
Settlement A payout failed for £123.45 → add a line –£123.45 to Settlement A invoice (Reserved Balances).
Settlement B includes +£123.45 → that line clears the Reserved Balances back to zero.
QuickBooks Online — fix a failed payout (journal posting)
For QuickBooks, Link My Books posts a journal entry for each settlement. The failed one will include a bank transfer line but you’ll have no bank transaction to match.
In QuickBooks, open the journal entry for the settlement whose payout failed.
(Tip: use the "View on QuickBooks" link on the view settlement page in Link My Books)Edit the bank transfer line as follows:
Description:
Amazon Reserved Balances - Failed to transfer fundsAccount:
Amazon Reserved Balances (LMB9)(or your chosen reserved balances account)Tax rate:
No VATAmount: leave the amount as is
Save the journal entry.
This moves the failed amount to Amazon Reserved Balances.When the next settlement arrives, Amazon includes the failed amount again. You’ll see a line for it in that journal which adds the same amount back from Reserved Balances, bringing the balance back to 0.
If multiple payouts fail in a row
Repeat the same action each time a payout fails:
Xero: add a negative line to the failed settlement invoice for the failed amount → Reserved Balances.
QuickBooks: edit the bank transfer line on the failed settlement journal to post to Reserved Balances.
Amazon will continue rolling the failed amount(s) forward until a payout succeeds, at which point the next settlement(s) will clear the Reserved Balances back to zero.
Troubleshooting & tips
Can’t find “Amazon Reserved Balances (LMB9)”?
Use the account you’ve designated for Amazon reserved balances.Already rolled back entries?
Go to Link My Books → re-send the affected settlements to your accounting software. Then apply the steps above to the failed settlement only.
What to expect next
Your next settlement will include the previously failed amount.
Reconciling that settlement will net off the Reserved Balances to zero automatically.
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].