Automated PayPal Sales & Fee Reconciliation (n8n)

1. **Setup PayPal Webhook**: In n8n, add a 'Webhook' node. Set the HTTP Method to POST. In your PayPal Developer Dashboard, create a Webhook pointing to this URL and select 'PAYMENT.SALE.COMPLETED'. 2. **Configure Node Credentials**: Navigate to 'Credentials' in n8n. Add 'Xero OAuth2 API' credentials by following the n8n documentation to create a Xero App and authorize access to your organization. 3. **Data Transformation (Set Node)**: Add a 'Set' node after the Webhook. Use expressions like `{{ $json.resource.amount.total }}` for the Gross and `{{ $json.resource.transaction_fee.value }}` for the fee. Calculate the Net amount using `{{ $json.resource.amount.total - $json.resource.transaction_fee.value }}`. 4. **Search/Create Contact**: Add a 'Xero' node. Set Resource to 'Contact' and Operation to 'Get All'. Filter by Email using `{{ $json.payer_email }}`. Use an 'If' node: if no contact exists, use another Xero node to 'Create' the contact. 5. **Generate Invoice**: Add a 'Xero' node set to 'Invoice' -> 'Create'. Map the 'Line Items' to include the product name and the total gross amount. Set status to 'AUTHORIZED'. 6. **Apply Payment**: To close the invoice, use a 'Xero' node with Resource 'Payment' -> 'Create', linking the Invoice ID and the PayPal Bank Account ID in Xero. 7. **Record PayPal Fee**: Add a 'Xero' node set to 'Bank Transaction' -> 'Create'. Set the Type as 'SPEND'. Map the fee amount and assign it to your 'Merchant Fees' chart of accounts code (e.g., 400). 8. **Duplicate Prevention**: Use the PayPal `parent_payment` or `id` as the 'Reference' in the Xero Invoice and Bank Transaction nodes to prevent double-entry. 9. **Error Handling**: Create a 'Error Trigger' workflow. If any node fails (e.g., Xero API down), n8n will trigger this sub-workflow to notify you via Slack or Email.

| PayPal Field | Xero Field | n8n Expression / Logic | | :--- | :--- | :--- | | `resource.id` | `Reference` | `{{ $json.resource.id }}` (Strict matching) | | `payer.payer_info.email` | `Contact Email` | `{{ $json.resource.payer_email }}` | | `amount.total` | `Invoice Line Amount` | `{{ parseFloat($json.resource.amount.total) }}` | | `transaction_fee.value` | `Bank Transaction Amount` | `{{ parseFloat($json.resource.transaction_fee.value) }}` (Mapped to Fee Account) | | `amount.currency` | `CurrencyCode` | `{{ $json.resource.amount.currency }}` (Requires Multi-currency) | | `create_time` | `Date` | `{{ $today.format('yyyy-MM-dd') }}` |

• **Webhook Validation**: PayPal requires a 200 OK response quickly. Ensure your n8n Webhook node is set to 'Respond Immediately' or put heavy processing behind a 'Wait' or 'Execute Workflow' node. • **Strict Typing**: Xero's API expects numbers for amounts. Use `parseFloat()` in n8n expressions to ensure strings like "10.00" become numbers. • **Rate Limits**: Xero has a limit of 60 requests per minute. If processing bulk historical data, use the n8n 'Wait' node or 'Split in Batches' set to 50 items. • **Account IDs**: You must use the UUID of the Xero Bank Account, not the account name. Find this by running a 'Bank Account: Get All' node once to fetch the ID.

- [ ] **Webhook Connection**: Trigger a test payment in PayPal Sandbox and verify the 'Webhook' node in n8n receives the JSON payload. - [ ] **Contact Lookup**: Ensure the 'If' node correctly branches between 'Existing Contact' and 'New Contact'. - [ ] **Math Check**: Verify the Fee + Net Amount in Xero equals the Gross amount received in PayPal. - [ ] **Reference Check**: Confirm the PayPal Transaction ID appears in the Xero Reference field for easy bank reconciliation. - [ ] **Error Path**: Manually disconnect the Xero node to ensure your n8n 'Error Trigger' sends a notification.