# Handling PayPal fees

Hi,

I have been charged a PayPal ‘fee’ of 5% of a payment made by a customer from the US. I charged the customer my service fee plus a 7% ‘Card handling charge’. The fee charged by PayPal is 5% of my service fee + my card handling fee of 7%.

In simple terms, it looks like whatever I charge my customers including a card handling fee, PayPal will take 5% of the total from whatever I’m paid?!!

Is there a way to ensure that when using PayPal my customers rather than me pay the 5% PayPal fee? -

Or if this is a price I have to pay, what’s the best way to use QF to account for the difference between what my merchant account says I’ve been paid and what I’ve actually been paid? -

Is this a business expense I can set against my income for tax purposes for example?

Many Thanks

Mike

You’d have to calculate your surcharge each time to counteract the PayPal fee - PayPal are charging 5% of gross, so you receive 95% of whatever the customer paid via PayPal. So for a given net value the question you ask yourself is “what gross would this be 95% of?”. Mathematically the answer is to divide the net amount by 0.95, so if you want to receive £100 then you need to charge 100 ÷ 0.95 = £105.26.

However PayPal’s own terms say you’re not supposed to impose a surcharge on your customers for choosing to use PayPal.

1 Like

Many Thanks - That’s a really helpful signpost

1 Like

Thanks for explaining that in such easy to follow terms

This topic was automatically closed after 7 days. New replies are no longer allowed.