PayPal fee information and calculator.
Aug 5, 2015 2:01:38 GMT -5
Obi-Shane, jedimax, and 1 more like this
Post by ARKM on Aug 5, 2015 2:01:38 GMT -5
Hi all.
The purpose of this thread/post is to explain what PayPal's fees are and how to do the math to determine what you need to pay when a seller asks you to pay for their PayPal fees. First, you need to know what the actual numbers for PayPal fees are. PayPal seller fees for domestic sales are 2.9% of the purchase total, plus 30 cents and for international sales are 4.4% + 30 cents. For domestic sales, it's always 2.9% of the total and always 30 cents on top of that and for international sales, it's always 4.4% of the total and always 30 cents on top of that. Because of that "plus 30 cents", it makes the math a little bit harder to do for some... like myself (I our smarht!). You cannot just use the purchase total, figure out the 2.9% or 4.4% of that and then add 30 cents to it. Nor can you add 30 cents to the total, figure out 2.9% or 4.4% of that new total and add that amount to it. Neither of those formulas are correct.
To work around this, most people would just charge their customers 4% (for domestic). For a lot of totals under $100, this is basically rounding up the PayPal fees from something higher than 3.5% but lower than 4%. This is an ok guesstimate for most transactions under $100 but in reality, if the purchase total (before PayPal fees) was super low, it would be over 4% and even before hitting the $100 mark, would be less than 3.5%. Fortunately, people smarter than I (read everyone) figured out the correct formula. Not only did some of those people post that formula online, some went as far as to provide online PayPal fee calculators to figure out what you really need to send the buyer without having to do the math yourself.
The correct formula for domestic sales is this... (product or service purchase amount + .3) / .971 = the grand total amount you must charge the buyer/pay the seller. Once you have the grand total, you may need to round it off to the nearest cent.
The correct formula for international sales is this... (product or service purchase amount + .3) / .956 = the grand total amount you must charge the buyer/pay the seller. Once you have the grand total, you may need to round it off to the nearest cent.
I hope that helps.
NOTE" For international sales ONLY, the "30 cents" may actually be a fluctuating number based off purchase price instead of exactly 30 cents. Only those that sell internationally and receive payment via PayPal can let us know that for sure.
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UPDATE Aug 27th, 2017:
I finally changed the formula for international sales to reflect the changes PayPal made on March 29th. Sorry it took so long, lol.
The purpose of this thread/post is to explain what PayPal's fees are and how to do the math to determine what you need to pay when a seller asks you to pay for their PayPal fees. First, you need to know what the actual numbers for PayPal fees are. PayPal seller fees for domestic sales are 2.9% of the purchase total, plus 30 cents and for international sales are 4.4% + 30 cents. For domestic sales, it's always 2.9% of the total and always 30 cents on top of that and for international sales, it's always 4.4% of the total and always 30 cents on top of that. Because of that "plus 30 cents", it makes the math a little bit harder to do for some... like myself (I our smarht!). You cannot just use the purchase total, figure out the 2.9% or 4.4% of that and then add 30 cents to it. Nor can you add 30 cents to the total, figure out 2.9% or 4.4% of that new total and add that amount to it. Neither of those formulas are correct.
To work around this, most people would just charge their customers 4% (for domestic). For a lot of totals under $100, this is basically rounding up the PayPal fees from something higher than 3.5% but lower than 4%. This is an ok guesstimate for most transactions under $100 but in reality, if the purchase total (before PayPal fees) was super low, it would be over 4% and even before hitting the $100 mark, would be less than 3.5%. Fortunately, people smarter than I (read everyone) figured out the correct formula. Not only did some of those people post that formula online, some went as far as to provide online PayPal fee calculators to figure out what you really need to send the buyer without having to do the math yourself.
The correct formula for domestic sales is this... (product or service purchase amount + .3) / .971 = the grand total amount you must charge the buyer/pay the seller. Once you have the grand total, you may need to round it off to the nearest cent.
The correct formula for international sales is this... (product or service purchase amount + .3) / .956 = the grand total amount you must charge the buyer/pay the seller. Once you have the grand total, you may need to round it off to the nearest cent.
I hope that helps.
NOTE" For international sales ONLY, the "30 cents" may actually be a fluctuating number based off purchase price instead of exactly 30 cents. Only those that sell internationally and receive payment via PayPal can let us know that for sure.
---------------------------------------------------------------------------------------------------------------------------
UPDATE Aug 27th, 2017:
I finally changed the formula for international sales to reflect the changes PayPal made on March 29th. Sorry it took so long, lol.
