It's the most repeated thread in every Etsy seller forum: "I sold £270 this month, why did £200 hit my bank?" The gap is rarely an error. It's the sum of a dozen small, legitimate deductions that are individually forgettable and collectively a fifth of your revenue. Here's where the money goes, in descending order of surprise.
Every sale sheds the transaction fee (6.5% — of the shipping too, which is the first thing most sellers miss), payment processing (4% + £0.20 in the UK), a listing fee, and the small regulatory operating fee. For UK sellers without a VAT number on file, Etsy then adds 20% VAT to all of those fees — a line plenty of sellers see for the first time when they audit a statement.
Offsite Ads fees (12–15% of an attributed order) don't arrive evenly — one ad-heavy week can dent a payout noticeably. Refunds come straight out of the balance, including partial ones you issued weeks after the sale. And timing muddies everything: a deposit is a snapshot of your rolling balance, so it mixes this week's sales with last week's fees and any reserve Etsy is holding. Comparing "this month's sales" to "this month's deposits" will almost never reconcile exactly — the statement rows are the truth, not the deposit line.
Download the payment account CSV for the period (Finances → Payment account), then total the row types separately: sales in, each fee category out, taxes out, refunds out, deposits as transfers. When each category has a number, the "missing" money stops being missing — it's £49.20 of itemised fees on £270 of sales, or whatever your shop's version is. Doing that by hand monthly is exactly the chore sellers complain about, which is why we automated it.
General information, not accounting advice. If your numbers genuinely don't add up after categorising, that's a question for Etsy support with your statement in hand.