Merchant accounts are accounts set up by a payment processor that hold payments you've received until you withdraw them. This guidance advises on how to set up a merchant account and record sales to it in Tally.
Setting Up
Start by creating a new bank account in Tally by going to Bank > Add a new Account. Using the options here:
- Account Name – call this account ‘Card Payments Merchant Account' or similar
- Starting Date – the starting date should be before the first transaction, i.e. 01/01/1970
- Starting Balance – this should be 0.00
When ready, click Update.
Recording Sales
When recording sales that have been paid with the merchant account do so in the usual way; although, for these invoices under the payment details section select the bank account to be this Merchant Account.
Recording Withdrawals
When you withdraw money from your merchant account to your business bank account do so using the Transfer function by going to Bank > Transfer Money Between Accounts.
- Date – set the date to the date that the money cleared or is dated on your bank statement
- Amount – this should be the amount that you see on the bank statement
- From – this should be the Merchant Account
- To – this should be the bank account that the merchant payment was paid into
- Comment – to make it easy to reconcile you can insert a comment such as 'Merchant Payment Jan '13'
When you’re ready, click Create Transfer. If you’re charged fee or commission on payments, you just add this as a transaction on merchant bank account. To do this click Bank > View/Add Transactions > Add a new money out transaction with the type as bank charge.