Benji Payments Accounting Transactions Guide

Modified on Tue, 4 Nov at 6:27 AM

This guide explains how payments and reconciliation work with Benji Payments, including the journal entries generated for each transaction type across supported accounting systems.

For information on other payment gateways (Moneris, Elavon etc), please refer to their respective articles.

When customers make payments through Benji Payments, the system automatically creates accounting transactions to accurately record payments, fees, and settlements.

This guide details how each step of the process is reflected in your accounting system — from the initial payment to reconciliation.

TABLE OF CONTENTS

Payment Application
- Without Surcharging
- With Surcharging
Surcharge Handling: Benji Payments vs Other Gateways
Balance Platform Report Reconciliation
Transaction Flow Examples
Key Differences Between Accounting Systems
Troubleshooting Common Issues

Payment Application

When a payment is processed and applied to an invoice in your accounting system, we create different transactions depending on whether surcharging is enabled.

Without Surcharging

QuickBooks Online

Transaction Created: Payment

Amount: Full payment amount
Deposit Account: Deposit Account (Benji Pays Clearing - USD)
Applied To: Customer invoice(s)

Example:

Payment: $100.00
Deposit Account: Benji Pays Clearing - USD
To: Invoice #12345 (Customer: Acme Corp)

Result:

Invoice balance reduced by $100.00
Benji Pays Clearing account increased by $100.00

QuickBooks Desktop (QBD)

Transaction Created: Payment

Amount: Full payment amount
Deposit Account: Deposit Account (Benji Pays Clearing)
Applied To: Customer invoice(s)

Example:

Payment: $100.00
Deposit Account: Benji Pays Clearing - USD
To: Invoice #12345 (Customer: Acme Corp)

Result:

Invoice marked as paid or partially paid
Benji Pays Clearing account increased by $100.00

Xero

Transaction Created: Payment

Amount: Full payment amount
Deposit Account: Deposit Account (Benji Pays Clearing - Current Asset)
Applied To: Customer invoice(s)

Example:

Payment: $100.00
Deposit Account: Benji Pays Clearing - USD
To: Invoice #12345 (Customer: Acme Corp)

Result:

Invoice status updated (paid/partially paid)
Benji Pays Clearing account increased by $100.00

With Surcharging

? Important: When surcharging is enabled, we withhold the surcharge amount in our platform account. The surcharge never reaches your clearing account, so a journal entry is needed to account for this.

You will also not see the transaction processing fees for this transaction other than the fixed per transaction fees on your processing account.

QuickBooks Online - With Surcharge

Transactions Created:

1. Journal Entry

Description: "Surcharge withheld by platform. Payment: [Payment Reference]"
Line 1 - Debit:
- Account: Accounts Receivable
- Amount: Surcharge amount
- Customer: Linked to the customer
Line 2 - Credit:
- Account: Deposit Account (Benji Pays Clearing)
- Amount: Surcharge amount

2. Payment

Amount: Total payment amount (including surcharge)
From Account: Deposit Account
Applied To: Invoice + Journal Entry from step 1

Example:

Invoice Amount: $100.00
Surcharge: $3.00
Total Charged to Customer: $103.00

Step 1 - Journal Entry:
DR  Accounts Receivable         $3.00  (Customer: Acme Corp)
CR  Benji Pays Clearing - USD   $3.00

Step 2 - Payment:
Amount: $103.00
From: Benji Pays Clearing - USD
Applied (linked) to:
  - Invoice #12345: $100.00
  - Journal Entry (surcharge): $3.00

Result:

Invoice fully paid
Surcharge of $3.00 is accounted for (customer owes it, but it's offset by the credit to your clearing account)
Net effect: $100.00 in your clearing account, $3.00 withheld by us

? Why This Works:

The journal entry creates an AR balance of $3.00 (customer owes the surcharge)
The payment applies $3.00 to that AR balance
The credit side reduces the clearing account by $3.00
This reflects reality: we kept $3.00, so your balance is $3.00 less than the customer paid

QuickBooks Desktop - With Surcharge

Transactions Created: Same structure as QuickBooks Online above

Example:

Journal Entry:
DR  AR Account                  $3.00  (Customer: Acme Corp)
CR  Benji Pays Clearing         $3.00

Payment:
Amount: $103.00
From: Benji Pays Clearing - USD
Applied to Invoice #12345 and JE

Xero - With Surcharge

⚠️ Special Note: Xero does NOT record surcharges for Benji Payments transactions.

Why?

Xero doesn't allow journal entries to be linked to bank transactions
We withhold surcharges, so they never hit your bank account
Recording the surcharge in Xero would create reconciliation issues
The surcharge is visible in platform reports but not in Xero

Transaction Created:

Payment Only: $100.00 (invoice amount without surcharge)
From Account: Deposit Account
Applied To: Invoice

Example:

Invoice Amount: $100.00
Surcharge: $3.00 (NOT recorded in Xero)
Total Charged to Customer: $103.00

Payment:
Amount: $100.00
From: Benji Pays Clearing - USD
To: Invoice #12345

Result:

Invoice fully paid with $100.00
Surcharge ($3.00) is tracked in our platform system only
Xero only sees the net amount that reached your clearing account

Platform Account Reconciliation

Our Balance Platform provides a daily accounting of all activity in your platform balance accounts. Benji Pays automatically processes these reports and creates journal entries for:

Fee Charges (transaction processing fees)
Bank Transfers (settlements to your bank account)
Fee Reversals/Adjustments/Chargebacks(credits and corrections)

These transactions are created daily automatically, but you will not see them immediately after processing a transaction.

1. Transaction processing fees

These are our processing fees charged per transaction by the payment network. These are not the same as our platform fees charged for our services - those will be charged to our card on file monthly.

QuickBooks Online

Journal Entry Created:

Reference: FEE-[Payment Reference]
Memo: "Processing Fees for [Payment Reference]"
Date: Date when balance is actually debited

Lines:

Debit:
- Account: Processing Fees Expense Account
- Amount: Fee amount
- Description: "[Payment Reference] (Fees)"
Credit:
- Account: Deposit Account (Credit Card or Bank, depending on payment type)
- Amount: Fee amount
- Description: "[Payment Reference] (Fees)"

Example:

Date: 2025-10-07
Reference: FEE-V3MQJ7CKT2R8NR69
Memo: Processing Fees for 15613

DR  BP Processing Fees           $46.74
CR  Benji Pays Clearing - USD    $46.74

Result:

Expense recorded for processing fees
Clearing account reduced by the fee amount
Matches the actual deduction from your platform balance account

QuickBooks Desktop

Journal Entry Created: Same structure as QuickBooks Online, will be created when you sync with QuickBooks Desktop.

Example:

DR  BP Processing Fees           $46.74
CR  Benji Pays Clearing - USD    $46.74

Xero

For Fees: Manual Journal Created

Example:

Date: 2025-10-07
Reference: FEE-V3MQJ7CKT2R8NR69
Narration: Processing Fees for 15613

DR  BP Processing Fees           $46.74
CR  Benji Pays Clearing - USD    $46.74

Note: Xero uses Manual Journals for fee transactions since they're not actual bank movements.

2. Bank Transfers (Settlements)

When we transfer funds from your platform clearing account to your bank account, this represents the settlement of funds you've already earned.

Transfer Direction Logic:

Outflow (Negative Amount): Sending funds TO your bank account (normal settlement scenario)
Inflow (Positive Amount): Receiving funds FROM your bank (rare - usually corrections or reversals)

QuickBooks Online

Journal Entry for Settlement (Outflow):

Reference: BP-[Transfer ID]
Memo: "Benji Pays Balance Platform - Bank Transfer: [Description]"
Date: Value date from report

Lines:

Debit:
- Account: Settlement Deposit Account (your actual bank account)
- Amount: Settlement amount
- Description: "Bank transfer (credit card) - [Description]"
Credit:
- Account: Deposit Account (Benji Pays Clearing)
- Amount: Settlement amount
- Description: "Bank transfer (credit card) - [Description]"

Example:

Date: 2025-10-08
Reference: BP-870ABC123DEF456
Memo: Bank transfer - Settlement to US Bank

DR  US Bank - Operating USD        $5,450.00
CR  Benji Pays Clearing - USD      $5,450.00

Result:

Funds move from clearing account to your bank account
Clearing Account (Current Asset) decreases
Bank Account (Asset) increases
Net effect: Asset-to-asset transfer (no impact on profit/loss)

QuickBooks Desktop

Journal Entry: Same structure as QuickBooks Online

Example:

DR  US Bank - Operating            $5,450.00
CR  Benji Pays Clearing - USD      $5,450.00

Xero - SPECIAL HANDLING

⚠️ Important: For bank transfers, Xero uses Bank Transactions (RECEIVE Money) instead of Manual Journals.

Why Special Handling?

Manual Journals cannot be reconciled with bank feeds
Bank transfers need to appear in the bank account's transaction list
Xero requires a "Contact" for all bank transactions

Transaction Created:

Type: RECEIVE Money (for outflow to bank)
Contact: "Benji Pays" (auto-created supplier contact)
Bank Account: Settlement Deposit Account (your real bank)
Reference: BP-[Transfer ID]
Description: "Benji Pays Balance Platform - Bank Transfer"

Lines:

Account: Deposit Account (Benji Pays Clearing)
Amount: Settlement amount

Example:

Type: RECEIVE Money
Date: 2025-10-08
Bank Account: US Bank - Operating USD
Contact: Benji Pays
Reference: BP-870ABC123DEF456
Description: Bank transfer settlement

Line Item:
  Account: Benji Pays Clearing - USD
  Amount: $5,450.00

Result:

Appears in your bank account's transaction list in Xero
Can be matched/reconciled with bank feed transactions
Reduces Benji Pays Clearing, increases Bank Account
Uses "Benji Pays" contact (required by Xero for RECEIVE transactions)

? Why "Benji Pays" Contact?

Xero requires every bank transaction to have an associated contact
"Benji Pays" represents our platform that's facilitating the transfer
The system automatically creates this contact if it doesn't exist
Contact Type: Supplier (since we're providing a service)

3. Fee Reversals / Adjustments

Occasionally, we may refund or adjust fees (e.g., chargeback reversals, fee corrections).

Journal Entry (All Systems):

For incoming fee adjustments (positive amount):

DR  Benji Pays Clearing - USD         $10.00
CR  BP Processing Fees                $10.00

Result:

Reduces your processing fee expense (refund/credit)
Increases your clearing account
Reflects that we credited fees back to you

Transaction Flow Examples

Example 1: Complete Payment Flow with Surcharge (QuickBooks Online)

Scenario:

Invoice: $100.00
Surcharge: 3% = $3.00
Total Charged: $103.00
Processing Fee: 3.0% + $0.30 = $3.30

Step 1: Customer Pays (Immediate)

Journal Entry - Surcharge:

DR  Accounts Receivable           $3.00  (Customer: Acme Corp)
CR  Benji Pays Clearing - USD     $3.00

Payment:

Amount: $103.00
From: Benji Pays Clearing - USD
To: Invoice #12345 ($100.00) + JE above ($3.00)

Balance After Payment:

Benji Pays Clearing - USD:  +$100.00 (received $103, less $3 surcharge withheld)
AR (Customer):              $0.00 (invoice paid, surcharge AR offset by payment)
Invoice Status:             PAID

Step 2: Processing Fee Charged (Next Day - from Report)

Journal Entry - Commission:

Date: 2025-10-08
Reference: FEE-ABC123XYZ

DR  BP Processing Fees            $0.30
CR  Benji Pays Clearing - USD     $0.30

Balance After Fee:

Benji Pays Clearing - USD:  $99.70 ($100.00 - $0.30)
Processing Fees Expense:    $0.30

Step 3: Settlement to Bank (2-3 Days Later - from Report)

Journal Entry - Bank Transfer:

Date: 2025-10-10
Reference: BP-870XYZ

DR  US Bank - Operating USD        $99.70
CR  Benji Pays Clearing - USD      $99.70

Final Balance:

Benji Pays Clearing - USD:   $0.00 (settled)
US Bank - Operating:         +$99.70 (received)
Processing Fees Expense:     $0.30 (cost of transaction)
Net Cash:                    $99.70 (from $100 invoice, less $0.30 fee)

? Summary:

Customer paid: $103.00
You received in bank: $99.70
We kept: $3.30 ($3.00 surcharge + $0.30 processing fee)
Your net cash: $99.70

Example 2: Complete Payment Flow WITHOUT Surcharge (Xero)

Scenario:

Invoice: $100.00
No Surcharge
Processing Fee: $3.30

Step 1: Customer Pays

Payment:

Amount: $100.00
From: Benji Pays Clearing - USD
To: Invoice #12345

Balance After Payment:

Benji Pays Clearing - USD:  +$100.00
Invoice Status:             PAID

Step 2: Processing Fee Charged (from Report)

Manual Journal:

Date: 2025-10-08
Reference: FEE-ABC123

DR  BP Processing Fees            $3.30
CR  Benji Pays Clearing - USD     $3.30

Balance After Fee:

Benji Pays Clearing - USD:  $96.70
Processing Fees Expense:    $3.30

Step 3: Settlement to Bank (from Report)

RECEIVE Money Bank Transaction:

Date: 2025-10-10
Type: RECEIVE Money
Bank: US Bank - Operating USD
Contact: Benji Pays
Reference: BP-870XYZ

Line:
  Account: Benji Pays Clearing - USD
  Amount: $96.70

Final Balance:

Benji Pays Clearing - USD:   $0.00 (settled)
US Bank - Operating:         +$96.70 (received)
Processing Fees Expense:     $3.30 (cost)

Key Differences Between Accounting Systems

QuickBooks Online vs Desktop

Similar: Both use the same journal entry logic
Different: QuickBooks Desktop requires Web Connector sync

Xero vs QuickBooks

Surcharging: Xero doesn't record surcharges; QuickBooks does
Bank Transfers: Xero uses RECEIVE/SPEND Money transactions; QuickBooks uses Journal Entries
Contacts: Xero requires "Benji Pays" contact for bank transactions
Deposit Account: Xero requires CURRENT ASSET (not BANK) for clearing account

Account Type Requirements

Purpose	QuickBooks Online	QuickBooks Desktop	Xero
Clearing Account	Other Current Asset / Bank	Bank	CURRENT (payments enabled)
Settlement Bank	Bank	Bank	Bank
Bank Transfer Transaction Type	Journal Entry	Journal Entry	RECEIVE/SPEND Money

Troubleshooting Common Issues

Issue: Surcharge not showing in Xero

This is expected: Xero does not record surcharges due to reconciliation limitation

Need Help?

For questions about:

Account configuration: Contact Benji Pays support for guidance on account mapping
System behavior: Contact Benji Pays support

Note: These transaction patterns are specific to Benji Payments. Other payment gateways may have different accounting treatment.