Etsy Shop Bookkeeping: A 30-Minute Monthly Routine

The core problem with using Etsy's dashboard as your books is that your deposits arrive net. Etsy takes its fees out of your payment account before it sends you anything, so a $1,000 month with $130 of fees shows up in your bank as roughly $870 — and if $870 is the only number you write down, you have simultaneously understated your revenue by $130 and lost $130 of deductible expense. Those two errors cancel out on the profit line, which is exactly why sellers never notice them. They do not cancel out on your tax return, on your pricing decisions, or in any conversation with an accountant.

The fix is a habit, not software. Once a month, download three files, paste three sets of numbers into a spreadsheet, and check that one subtraction works. The first time takes an hour because you are building the sheet. After that it is a coffee-length job: roughly five minutes to download and file the exports, ten to log sales and Etsy's fees, five for your own receipts, five for the reconciliation check, and five reading what the month actually says. Those are estimates for a shop doing tens of orders a month, not hundreds.

The three files you download every month

Etsy's exports live under Shop Manager, and the exact menu labels shift as Etsy redesigns its interface, so treat the locations below as a map rather than a fixed address. What matters is that you end up with three distinct files, because no single one of them contains everything.

Save all three into a folder named by year and month, e.g. 2026-08. Platforms limit how far back you can re-download, and future-you will want the raw file, not just your typed-up totals.

Why gross revenue and fees must be recorded separately

This is the one idea the whole routine rests on. Your revenue is what the buyer paid you. Etsy's fees are a business expense you incurred. The fact that Etsy nets them off before paying you is a payment mechanism, not an accounting rule.

Record only the deposit and you quietly delete a deduction. Consider a shop with $1,000 of gross sales in a month and $130 of Etsy fees, on which the owner also spent $200 on materials and postage:

Same profit, completely different books. The right-hand column can't tell you your fee percentage, can't show an accountant a defensible revenue figure, and will disagree with any marketplace or payment-processor report that states your gross volume rather than your net payouts. Reporting thresholds and form names differ by country, so check what your platform issues where you file.

Step 1 — Log the month's sales

Open the Orders CSV and record, per order or per month depending on your volume: order date, item, quantity, item price, shipping charged to the buyer, any discount or coupon, and sales tax or VAT that Etsy collected. Keep tax collected in its own column rather than folding it into revenue. Where a marketplace collects and remits a tax on your behalf it is generally not treated as your income, but which taxes that covers depends on where you and your buyers are, so confirm the treatment for your own situation with an accountant.

Under roughly 30 orders a month, log each order individually; it takes minutes and makes tracing a discrepancy trivial. Above that, log daily or weekly subtotals and keep the CSV as your backup detail. Pick one rule for orders straddling a month end — order date or deposit date — write it at the top of the sheet, and never switch mid-year.

Step 2 — Log Etsy's fees

Open the statement CSV and total each fee type separately. Typically that means listing fees, transaction fees, payment processing fees, Offsite Ads fees, Etsy Ads spend, any subscription such as Etsy Plus, and currency conversion charges if you sell in a currency other than your payout currency. Etsy's published rates change and vary by country, so read them off your own statement rather than from memory or from an article — including this one.

Separate columns matter because the fee types behave differently. Listing fees are near-fixed and reward higher-priced items. Transaction and processing fees scale with revenue. Offsite Ads fees are charged only on the sales Etsy attributes to those ads, so they can make one good month look strangely expensive — check how they appear on your own statement. Lumping them into a single "Etsy fees" figure hides all of that.

Sanity-check one order by hand each month. Take a single sale, run it through the Etsy Fee & Profit Calculator, and see whether the fees you were charged match what you expected. If they don't, you have either mis-typed a rate or found a fee you didn't know you were paying — both worth catching early.

Step 3 — Log your own expenses

Everything Etsy didn't take out of your payout, you paid from your own pocket, and it belongs in the books. A workable category list for a handmade or print shop:

• Materials and supplies — the physical inputs of what you sell.
• Packaging — boxes, mailers, tissue, tape, thank-you cards, stickers.
• Postage and labels — including labels bought outside Etsy, which won't be on any Etsy statement.
• Tools and equipment — cutting machines, printers, cameras. Larger purchases may need to be depreciated rather than expensed in one go; ask your accountant where the line sits where you file.
• Software and subscriptions — design apps, cloud storage, mockup tools, email.
• Advertising outside Etsy — social ads, influencer gifting, sample costs.
• Market and craft fair costs — stall fees, travel, card reader charges.

The quiet killer here is postage bought on your personal card and never recorded. Get one card or account used only for shop spending; the reconciliation step below becomes ten times easier.

Step 4 — Reconcile

This is the step that turns a list of numbers into books you can trust. The identity you are checking is:

Gross sales + shipping collected − Etsy fees − refunds = deposits received

Tax that Etsy collects and remits for you passes straight through: it comes in and goes back out again, so it nets to zero in this check. Show both sides anyway — a visible pair of lines is much easier to explain later than a number you silently left out.

Here is what that looks like with illustrative figures for a single month (your own fee percentage will be different — read it from your statement):

If your bank shows a different figure, work through the usual suspects in order. A deposit that crossed the month boundary is by far the most common cause, followed by a refund issued in a later month than the sale, a reserve or held payment on a newer shop, and Etsy recovering a negative balance out of the next payout. Currency conversion explains most small residual differences for sellers paid in a currency other than the one they sell in.

Do not force the numbers to agree. Add a line called "unexplained difference", note what you checked, and move on if it is trivially small. If the same unexplained difference shows up two months running, it is a real pattern and worth an hour of digging.

Step 5 — Set aside for tax on profit, not on deposits

Once the month reconciles, move a percentage of the month's profit into a separate savings account. Not a percentage of your deposits — deposits still contain money that will be spent on materials, and in a heavy restocking month that difference is large enough to leave you short.

You supply the percentage; nobody on the internet can tell you what yours should be, because it depends on where you file, what else you earn, and what your allowances look like. Ask an accountant for a figure, then use the Tax Set-Aside Calculator to turn it into a monthly transfer. The point is the habit: a standing transfer on the day you close the month is what stops a tax bill from being a crisis. This is a savings routine, not tax advice.

Step 6 — Read the month

Five minutes with the finished numbers is where the routine actually pays. Three things are worth watching over time, and all of them are meaningless as a single month's snapshot:

• Total fee percentage (all Etsy fees ÷ gross sales). Watch the trend, not the level. A creeping percentage usually means Offsite Ads or your own Etsy Ads spend growing faster than the sales they bring.
• Gross margin per product line (price − materials − fees, before your time). A product that looked profitable at last year's material costs may not be now.
• Profit per hour worked, if you track hours even roughly. It is the number that tells you which products deserve more listings and which are hobbies you're subsidising.

Refunds, cancellations and partial refunds

The temptation is to go back and edit the original sale. Resist it — you will break totals you have already reported and possibly already paid tax on.

Record a refund as its own dated line in the month it was issued, referencing the original order number, as a negative revenue entry rather than an expense. Etsy typically returns some fees when you refund and not others, and the treatment differs by fee type, so read the fee credits off your statement rather than assuming a full reversal. For a partial refund, record only the refunded portion. Cancellations before payment never enter the books at all.

Multi-channel sellers

If you also sell through print-on-demand, a market stall, or another marketplace, use the same monthly sheet with a "channel" column rather than a separate set of books per platform. One P&L is the whole point; you cannot compare channels that live in different files.

Print-on-demand needs one extra care point: the base cost is a real cost of goods and belongs in your expenses even though it never touches your bank account separately from the payout. The Print-on-Demand Profit Calculator is a quick way to check a product's true margin before you decide it deserves a place in the shop.

Year end

An accountant will typically ask for total gross sales, total platform fees split by type, total expenses by category, refunds, closing stock if you carry any, and the raw platform reports to back it all up. If you have done the twelve monthly closes, that is a sum across twelve rows and a folder of CSVs you already saved — genuinely a twenty-minute job. If you have not, it is the worst weekend of your year, reconstructed from bank statements against a deadline.