Overview
Shop App is Shopify's innovative mobile app, allowing users to shop online through their phones or tablets. It enhances the shopping experience with features like real-time order tracking and personalised product recommendations.
What is Shop Cash?
When customers use the Shop App to make purchases and check out with Shopify Payments (including debit cards, credit cards, Google Pay, etc.), they can earn Shop Cash rewards. These rewards can be redeemed on future purchases at any Shopify store, thus reducing the customers’ amount to pay, providing a convenient and enticing loyalty incentive.
When a customer uses Shop Cash to pay for a purchase, Shopify then credits the amount redeemed to the Seller’s payout. In the end, the business gets the total amount of the order.
For more details, you can visit the Shopify Help Center on Shop Cash.
How Shop Cash Works for Merchants:
Paid out by Shopify: When customers redeem the rewards for their purchase payment, Shopify provides an equivalent Shop Cash credits to the merchant’s payout, identified as "Gateway Shop Cash" in your A2X payout.
Merchant Costs: The only out-of-pocket cost for merchants is the standard merchant fee charged on the Shop Cash transactions, the same as the Shopify Payments fee. There are no additional costs or deductions for the Shop Cash amount itself.
Key Points for Merchants:
Incentive Program: Shop Cash rewards are funded and managed by Shopify. Merchants do not have direct control over the issuance or redemption of these rewards; it is an arrangement between Shopify and the customer.
Payout Adjustments: Shopify will adjust the merchant's payout to account for any Shop Cash-related redemptions or refunds. These adjustments appear in the merchant's payout reports.
A2X Mapping and Details Explanation
Note: Each Shopify store may have unique transactions related to Shop App and Shop Cash, including specific regional variations. The recommended account mappings below are guidelines and should be applied based on the specific context of your store.
Shop Cash Marketplace Code: 3890849
In A2X, the recommended mappings for transactions is for both sides of the Shop Cash transactions (gateway and credit) to the same General Ledger account, e.g. Shop Cash Clearing Account.
Shop Cash transactions should ideally offset each other, bringing the Shop Cash Clearing account to a zero balance. Proper mapping in A2X allows for straightforward reconciliation of these transactions.
Gateway Transactions
Sale Gateway shop_cash / Capture Gateway shop_cash: This indicates that the customer used their Shop Cash reward for the full payment of the order.
NonShopifyPayment shop_cash: This represents a partial payment using Shop Cash alongside another payment gateway.
Refund Gateway shop_cash / NonShopifyRefund shop_cash: When an order is refunded, Shopify first refunds the Shop Cash rewards applied to the payment before refunding the monetary amount to the customer's bank.
ShopCashCredit- 3890849: These are the credits from Shopify to the business for the Shop Cash amount. They generally offset the Sale Gateway shop_cash or NonShopifyPayment shop_cash transactions.
ShopCashDebit- 3890849: These are the refunds of Shopify paying the business for Shop Cash. These transactions generally offset the Refund Gateway shop_cash or NonShopifyRefund shop_cash transactions.
Shopify Fee Transactions
The Shopify fee from Shop Cash transactions will still go to the Shopify Fee Expense account, identified in your A2X payout as ShopifyFeeShopCash.
Examples of Shop Cash in Payouts:
Offsetting in the Same Payout:
Customer payment captured on one Payout, Shop Cash Credit and Shop Cash Fee captured on another Payout:
Reconciling Shop Cash Clearing
If the Shop Cash Clearing account does not reconcile to zero at the end of the month, consider the following steps:
Verify A2X Transaction Mapping: Ensure that all transactions are correctly mapped in A2X.
Review GL Transactions: Check the Clearing Account GL Transactions Report (QBO) or Account Transactions (Xero) for any unrelated transactions.
Check for Correct Descriptions: The Shop Cash Clearing account should primarily include the described line items.
Consider timing of when the order was paid with Shop Cash and when it was added by Shopify in a payout.
Other Shop App Transactions
Shopify Campaign Billing Debit
What is it?
An advertising method on Shopify that runs ads on Shopify marketplace. The business only pays when a customer buys from the business.
Shopify will take this fee out of your Shopify payout.
You can read more about the Shopify advertising here.
Accounting Entries and Considerations
We recommend mapping this to an Advertising Expense account.
Double-check your transactions to ensure correct mapping.
Shopify Credit/Debit
These are typically found on payouts prior to March 2025. Refresh these payouts to pull in the ShopCash transactions. If you see them on recent payouts, please review these in Shopify to determine how to map them correctly in A2X.
Review Shopify App Transactions
To get a detailed breakdown of your Shop cash Debit and Credit transactions, please follow the instructions below:
Go to Shopify > Finances > Payouts > View order transactions.
Toggle to More filter
Open the Type dropdown and select Shop Cash. You can further filter the transaction date depending on your reconciliation period.
Click Export to review the file in Excel.
Shop App Marketplace Sales Tax
What is it?
Shopify sales channel collecting and remitting sales tax for all ship-to US orders, starting January 1, 2025.
Sales tax collected on orders placed through the Shopify app are withheld by Shopify and remitted through the Marketplace Facilitator.
You can read more about the Shopify sales tax from Shopify here.
Learn about these transactions and accounting considerations from A2X here.
Please note that only the Shop App, denoted as marketplace 3890849 in A2X, is collecting and remitting the sales tax on behalf of the seller.
Shopify Online, manual (draft) orders, etc., do not have a marketplace facilitator tax. Taxes collected from these other Sales channels are still the responsibility of the seller to remit in the states they have nexus.