Reviewed by the SEOPointz team · Last reviewed June 2026. We test the bookkeeping and tax tools named below against real ecommerce sellers’ needs rather than relying on vendor marketing. SEOPointz may earn a commission from some links; it never changes what we recommend.
Ecommerce accounting breaks in ways that trip up bookkeepers who came up through brick-and-mortar retail. A single Shopify or Amazon payout is not one number — it is dozens of orders, refunds, shipping charges, marketplace fees and sales tax all netted into one deposit that lands in your bank a few days late. If you book that deposit as “sales,” your revenue is understated, your fees are invisible, and your tax filings are wrong. This guide walks through how to actually keep the books for an online store: what to track, which software combination works, and where sellers most often get burned.
Why a marketplace payout is not your revenue
The core problem is that platforms pay you net, not gross. Say you sell £5,000 of product in a Shopify pay period. After payment processing (commonly 2.9% + 30¢ per order on Shopify’s Basic plan), refunds, and any third-party gateway fee, the deposit that hits your bank might be £4,500. Recording £4,500 as revenue erases the £500 of fees you are legally entitled to deduct as an expense, and it hides the sales tax you collected on behalf of the state. Proper ecommerce bookkeeping splits every payout back into its components: gross sales, refunds and returns, platform and processing fees, shipping income, and sales tax collected. That split is the single most important habit in the whole discipline.
Cash vs accrual — and why inventory forces your hand
Many new sellers start on cash-basis accounting because it is simple: record money when it moves. That falls apart once you hold inventory. If you buy £10,000 of stock in one month and sell it over the next six, cash basis shows a catastrophic loss in month one and fat profits afterward — a distorted picture that makes planning impossible. Accrual accounting, paired with proper cost of goods sold (COGS) tracking, matches the cost of a product to the month you actually sell it. In most jurisdictions, businesses holding meaningful inventory are expected to use accrual for tax purposes once they pass a revenue threshold, so it is worth setting up correctly from the start rather than migrating later.
The software stack that actually works
There is no single app that does everything well, so experienced ecommerce accountants build a small stack. The pattern that has become the default is a general ledger (QuickBooks Online or Xero) plus a reconciliation connector that translates messy marketplace payouts into clean accounting entries. A2X is the best-known connector for this job: it pulls settlement data from Amazon, Shopify, eBay, Etsy and Walmart and posts summarized, tax-aware journal entries into your ledger so the deposits reconcile to the penny. For multi-state US sales tax, a dedicated engine such as TaxJar (good for small and mid-size sellers) or Avalara (built for enterprises across many states and countries) handles calculation and filing that your accounting software alone cannot.
What the tools cost
Pricing below reflects published 2026 rates; always confirm on the vendor’s site, since plan structures change and several tools scale with order volume or transaction count.
| Tool | Role | Entry price (2026) | Best for |
|---|---|---|---|
| QuickBooks Online | General ledger | From ~$20/mo (Solopreneur); Plus ~$115/mo | Largest US accountant ecosystem |
| Xero | General ledger | Early ~$25/mo; Growing ~$55/mo | Multi-currency, no per-user charge |
| A2X | Payout reconciliation | From $29/mo (Walmart plan from $79/mo) | Splitting marketplace settlements |
| TaxJar / Avalara | Sales tax engine | Quote-based; scales with volume | Multi-state nexus & filing |
For international sellers, Xero has a practical edge: it does not charge extra per user, so an owner, a bookkeeper and an outside accountant can all have access without inflating the bill, and its multi-currency handling is strong. For US-based sellers, QuickBooks paired with A2X has the deepest bench of accountants who already know the workflow.
The mistakes that cost sellers the most
Three errors show up again and again. First, ignoring sales tax nexus: storing inventory in a fulfillment warehouse (such as Amazon FBA) can create a tax obligation in a state you never registered in, and the notices arrive long after the liability started accruing. Second, mishandling inventory and COGS, which leaves profit numbers fictional and overstates taxable income. Third, reconciling against the bank deposit instead of the settlement report — the deposit is net of fees and timing differences, so it never matches your sales records, and forcing it to balance buries real errors. Build your process around the platform’s settlement data, not your bank feed.
Frequently asked questions
Do I really need accounting software, or can I use spreadsheets?
A spreadsheet can work for a brand-new store with a handful of orders, but it breaks down fast once you have refunds, multiple sales channels and sales tax to track across states. The reconciliation alone — matching dozens of orders to a single payout — is the thing spreadsheets handle worst, which is exactly why connector tools exist.
When should I hire an ecommerce accountant rather than doing it myself?
A good trigger is when you cross into multi-state or multi-country sales tax, start holding significant inventory, or simply find month-end taking longer than the time it saves. An accountant who specializes in ecommerce (and knows tools like A2X) usually pays for themselves by catching tax exposure and cleaning up COGS.
What is the difference between profit and the money in my bank account?
They are rarely the same. Cash can be high because you collected sales tax you still owe, or low because you just bought inventory you have not sold yet. Accrual accounting with proper COGS is what reveals your true profit, separate from your cash position.
Once your books are clean, the next step is using them to steer the business — track the right numbers in our guide to ecommerce shipping strategies so freight costs stop quietly eroding margin, and tighten the back end with our walkthrough of ecommerce fulfillment.
