Gift card reporting and accounting setup

Summary: Giftnote gift cards are sold as a product, so the purchase appears in your Shopify sales reports rather than under gift card liability. This article explains how to configure your reporting and accounting so gift cards are treated as a liability at purchase.

How Giftnote gift cards work

Giftnote sells a gift card product, then issues a real Shopify gift card through Shopify's Gift Card API. Selling it as a product is what enables custom amounts, branded gift card emails through Klaviyo, SMS delivery, and bulk corporate gifting.

Issued cards appear correctly in Analytics → Reports → Finances → Liabilities under Issued value, and redemption draws that balance down as normal.

Because the purchase itself is a product sale, Shopify records it in your sales reports rather than as a gift card sale. Most businesses treat gift card purchases as deferred revenue, so you'll want to map the purchase to a gift card liability account in your accounting system. Here's how.

This is not accounting advice. Gift card treatment varies by jurisdiction — please confirm the approach below with your accountant or bookkeeper.

A worked example

Say you sell a $100 gift card.

Most jurisdictions treat that $100 as deferred revenue — a liability, not a sale. You've taken the money, but you've also created a future obligation to supply $100 of goods.

The recipient later spends $80 of it:

• Your gift card liability drops from $100 to $20

• You recognise $80 as sales revenue at that point

• The remaining $20 stays on the books as a liability until it's redeemed or written off

The revenue event is the redemption, not the purchase. Mapping the purchase to a liability account, as below, is what makes that work.

Setting this up in A2X (Xero and QuickBooks)

A2X supports this through Product Type Grouping — you group the Giftnote gift card SKU as its own product type, then map that line to a gift card liability account. Redemption then becomes the revenue event.

1. In A2X, go to Settings → Product Types and create a product type, for example "Gift Cards". Add your Giftnote gift card SKU(s), or use a regex pattern to match them.

2. Go to Settings → Sales Grouping and Tracking and enable Group by Product Type.

3. In your account mapping, point the gift card line to your Gift Card Liability account.

• How to set up Product Type Grouping for Shopify

• Account and tax mapping

Nothing artificial is added to your data — the existing line is simply mapped to the right account.

Need your SKUs? Get in touch and we'll send the gift card SKUs for each of your stores.

Reporting inside Shopify

You can filter or segment Shopify sales reports by product, product type, or vendor — Giftnote gift card products use the vendor Giftnote. This gives you a sales figure with gift card purchases separated out.

Reviewing earlier periods

If you've been selling Giftnote gift cards for a while and want to align prior periods, get in touch and we'll send a gift card report per store broken down by month, so your accountant can handle it in a single journal.

Further reading

Requirements differ by country. Your accountant is the right source, but these are good starting points:

• Australia — ATO guidance on vouchers and GST

• United Kingdom — HMRC guidance on face-value vouchers

• Canada — Financial Consumer Agency of Canada, gift cards

• United States — GAAP treatment of gift cards (ASC 606), including breakage

Roadmap

We've raised this with Shopify's gift card product team and are pushing for the Gift Card API to support app-issued cards being classified as gift card sales. We'll update this article when there's news