PayPal Fee Calculator
Estimate transaction fees and calculate exactly how much you will receive.
Total Fee:
$0.00
You Receive (Net):
$0.00
Amount to Ask For (to net your total):
$0.00
Understanding PayPal Transaction Fees
If you are a freelancer, a small business owner, or an online seller, understanding how payment processors calculate their cut is vital for maintaining your profit margins. PayPal, one of the world's largest payment gateways, typically charges a percentage of the total transaction plus a flat fixed fee.
Standard Merchant Rate: For many years, the standard domestic rate for PayPal Goods & Services has been 2.9% + $0.30. However, depending on your region or if you are using PayPal Checkout, these rates can range from 1.9% to 3.49% + a fixed fee.
How the Math Works
There are two ways to look at PayPal fees:
- The "What I Get" Calculation: If you invoice a client for $100, PayPal takes their percentage and the fixed fee from that $100. You receive the remainder.
- The "Reverse" Calculation: If you need to walk away with exactly $100 in your pocket, you must invoice for more than $100 to cover the fee that PayPal will deduct.
Real-World Examples
Example 1: Sending $500
Using a 2.9% + $0.30 fee structure:
– 2.9% of $500 = $14.50
– Fixed Fee = $0.30
– Total Fee = $14.80
– Recipient receives = $485.20
Example 2: Needing $1,000 Net
If you want to receive exactly $1,000, the formula is: (Amount + Fixed Fee) / (1 – Percentage).
– ($1000 + 0.30) / (1 – 0.029)
– $1000.30 / 0.971 = $1,030.18
– You should invoice for $1,030.18 to receive exactly $1,000.00.
Ways to Reduce PayPal Fees
While fees are a part of doing business, you can minimize their impact by:
- Friends & Family: Using the "Friends and Family" option for personal transfers (note: this offers no buyer protection).
- Requesting Larger Payments: Since there is a fixed fee per transaction, fewer large payments are cheaper than many small payments.
- Accounting for Fees: Always include the cost of payment processing in your service pricing or item cost.
- Tax Deductions: In many jurisdictions, payment processing fees are considered a tax-deductible business expense.