What is e-commerce accounting?
E-commerce accounting is bookkeeping and accounting for businesses that sell online, through their own store, marketplaces such as Amazon, and payment providers. It turns large volumes of orders, refunds, fees, discounts and payouts into accurate revenue, cost of goods sold and margin, and reconciles each platform's payouts to the bank, alongside inventory and sales tax.
Also calledecommerce accountingonline store accountingShopify accountingAmazon seller accounting
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- Main difficulty
- Net payouts hide sales and fees
- Needs
- Order and settlement data
- Also covers
- Inventory and sales tax
How e-commerce accounting works
The main difficulty is that the bank only shows net payouts. A single Shopify or Amazon deposit combines many orders, minus refunds, platform fees, shipping charges, advertising and reserves, so recording the deposit as revenue would understate sales and hide costs. Accurate books break each payout into its parts from order and settlement data and match it to the bank. Inventory adds another layer: cost of goods sold must reflect what was actually sold, at landed cost including freight and duties, across warehouses and fulfilment centres. Sales tax and VAT depend on where customers are, and marketplaces collect it in many places. Real-time or daily processing suits the volume better than month-end catch-up. Finaloop produces GAAP-ready books from Shopify, Amazon and payment data, and Doss handles inventory, orders and purchasing for consumer brands.
Common questions
Why is e-commerce accounting difficult?+
Because platform payouts net together sales, refunds, fees and reserves, inventory moves across several locations, and sales tax depends on each customer's location.
How should Shopify or Amazon payouts be recorded?+
Split into gross sales, refunds, discounts, fees and other deductions using the platform's settlement data, then matched to the deposit in the bank, rather than recorded as one revenue figure.
Do marketplace sales include sales tax?+
Often. In many US states, the EU and the UK, marketplaces collect and pay the tax on sales made through them, which must be reflected in the seller's books and returns.
E-commerce accounting software
Part of Accountio’s accounting technology coverage · Glossary
