Bookkeeping categories
What category is PayPal in bookkeeping?
A PayPal payout into your bank is usually Sales Revenue. Even Margin categorizes it that way and asks you to confirm it. Money going to PayPal can be a fee, a refund or a purchase, so Even Margin uses your bank's category for it, or asks you when the bank gives none.
What PayPal charges are
PayPal moves money in both directions: customer payments arriving, and purchases, refunds or transfers going out.
How Even Margin categorizes PayPal
Sales Revenue. Payouts categorized, then sent to your review list.
- Even Margin recognizes PayPal on your bank transaction, using the merchant list its team curates.
- A PayPal payout into your bank is categorized as Sales Revenue at medium confidence and goes to your review list to confirm.
- Money going to PayPal takes your bank's category for it. When the bank gives none, it goes to your review list for you to choose.
When a different category fits
Whatever category you pick for a PayPal transaction stays: Even Margin never overwrites a choice you made.
- Moving your own PayPal balance to your bank is Account Transfer: money moving between your accounts, not new income.
- Paying a shop with PayPal shows as PAYPAL * and the shop's name. Even Margin reads the shop after the star and, when it is on the merchant list, suggests its category at medium confidence, with Paid through PayPal in the transaction's details when your bank reports it. PP* is the same, as the statement codes page explains.
- PayPal fees are Merchant & Payment Processing Fees.
Is money from PayPal always income?
No, and that is why Even Margin asks. It suggests Sales Revenue for money arriving from PayPal and puts it on your review list, where a customer payment stays Sales Revenue and your own balance moving across becomes Account Transfer.
What if I use PayPal for personal payments too?
Personal money leaving the business through PayPal is Owner Draw / Personal, and your own money coming in is Owner Contribution. Neither counts toward profit, so your figures show only the business.
About this page
Reviewed 2026-10-08 by the Even Margin team.
These are categories for your books; for how a cost is treated on your tax return, ask your accountant. Merchant names are trademarks of their owners, and Even Margin is not affiliated with them.