How to Calculate the PayPal Goods & Services fee (1 Viewer)

[Himewad]

I think some people who are new to the site (and maybe some who aren't so new) need a refresher on how to use PayPal. I have run a lot of group buys over the past couple of years, and with the recent hacker attacks on our members, people are finally starting to use the Goods & Services option that gives the buyer some protection when they make a payment. But I guess not everyone knows that this imposes a fee on the person receiving the payment.

First of all, when you are making a PayPal payment, you will eventually get to a screen that has this on it.

"Sending to a friend" means that you are using PayPal Friends & Family, which does not give the buyer protection should the seller not fulfill their duties. If you click on the "Change" link on the right, you will get to this screen.

"Paying for an item or service" means that you are using PayPal Goods & Services, which does give the buyer protection should the seller not fulfill their duties, but it also deducts an amount from the amount you are paying to the seller. For transactions made from one USA account to another USA account, this fee is 2.89% + $0.49. The formula to give the seller their full payment is as follows:

(Payment Due to the Seller + $0.49 ) divided by 97.11% = G&S Payment Made by the Buyer

So, if you buy chips for $100 + $9 shipping ($109 total due to the seller), and want to pay using the G&S option, you need to pay ($109 + $0.49) = $109.49 divided by 97.11% = $112.75. Paying this amount will give the seller the full $109 ($112.75 x 2.89% = $3.26 + $0.49 = $3.75 G&S fees).

International PayPal fees are higher, but I'm not sure exactly what those fees are. They seem to be all over the board. If anyone knows how to calculate them, please post in this thread.

BOTTOM LINE: MAKE SURE YOU KNOW WHICH PAYMENT METHOD YOU ARE MAKING WHEN USING PAYPAL, AND IF YOU CHOOSE THE GOODS & SERVICES OPTION, MAKE SURE YOU SEND THE CORRECT AMOUNT SO THAT THE SELLER RECEIVES THE FULL PAYMENT.

 

[buffalojim]

Sticky

 

[upNdown]

I’ll put another bottom line on that:
Bottom line - make sure your seller is okay with this. I probably would not be. Because now, when you send somebody money via goods and services over $600, that’s going to generate some tax paperwork for them at the end of the year, right? They might not want the headache. Discuss this with your seller!

 

[Tommy]

https://www.pokerchipforum.com/pcf/paypal-fees-calculator/

 

[ReallyGoodUsername]

Wait it’s 3% + .50? Never knew that. I always do the amount x 1.031% since you’re going to be taking 97% of a larger number

 

[Tommy]

I created that page in 2018 so the rates are probably not up to date. You can enter the current rates in the top right box, then use the bottom boxes to do the calculation.

 

[buffalojim]

https://www.pokerchipforum.com/pcf/paypal-fees-calculator/

I knew that

 

[Himewad]

https://www.pokerchipforum.com/pcf/paypal-fees-calculator/

Unfortunately, those rates and fees have changed, and the internet has rates all over the board. I tried using PayPal's G&S help to calculate fees for Canadian payers coming to me, and I still didn't receive the correct amount. It's frustrating.

 

[Himewad]

Wait it’s 3% + .50? Never knew that. I always do the amount x 1.031% since you’re going to be taking 97% of a larger number

Yep, they charge a percent of the total plus a flat fee. And for international payments, the buyer gets charged another fee.

 

[Ethan]

Don’t forget to add the extra income tax expense to your charges

 

[Tommy]

Unfortunately, those rates and fees have changed, and the internet has rates all over the board. I tried using PayPal's G&S help to calculate fees for Canadian payers coming to me, and I still didn't receive the correct amount. It's frustrating.

It's only for people in the same county. I just updated USA to 3% and .50 cents. I'm sure the others need updating but those in the other countries can manually enter the rate until it's all updated.

Note: The calculations here are for Goods & Services payments between accounts in the same country. (ex: US to US) Please use this as a guide only and check with PayPal for their latest fees.

 

[Tommy]

@Himewad where did you see the 3% and 50c? I'm still seeing The fee costs 2.9% plus $0.30 USD

 

[Tommy]

@Himewad where did you see the 3% and 50c? I'm still seeing The fee costs 2.9% plus $0.30 USD

That's not right either. I see 3.49% and .49 now. And it looks correct after comparing it.

 

[Himewad]

I googled a ton of different ways to find it, and came up with many different rates and flat fees. Eventually, I found one that works.

So basically, I had to reverse-engineer it. Seems to be spot-on.

 

[Himewad]

I requested $12.00 from someone just yesterday. They decided to pay G&S and didn't include extra fees. PayPal gave me $11.16.

When I was collecting for my last group buy, I found that my personal calcuations were off by a penny. I was using $0.49 as the flat fee. So I figured making it $0.50 would fix it.

 

[ReallyGoodUsername]

Why the fuck can they not make it simple.

Edit: hey I can say fuck now. Niiiiice

 

[Tommy]

I requested $12.00 from someone just yesterday. They decided to pay G&S and didn't include extra fees. PayPal gave me $11.16.

When I was collecting for my last group buy, I found that my personal calcuations were off by a penny. I was using $0.49 as the flat fee. So I figured making it $0.50 would fix it.

Here you go.

 

[Tommy]

 

[LeLe]

I got the link for paypal calculator for your reference
https://www.ebayfeescalculator.com/us-paypal-fee-calculator/

I requested $12.00 from someone just yesterday. They decided to pay G&S and didn't include extra fees. PayPal gave me $11.16.

Using Himewad example

As long as It paid in USD and received in USD this will work,

Paypal rate is 2.89% + 49c (This is the option for Send/receiving money for G&S)

 

[Himewad]

View attachment 846411

View attachment 846409

Good grief. I should just avoid running group buys at this point.

 

[Himewad]

OK - I will update my OP to use 2.89% and $0.49 for US to US payments.

 

[LeLe]

International PayPal fees are higher, but I'm not sure exactly what those fees are. They seem to be all over the board. If anyone knows how to calculate them, please post in this thread.

This part is only applicable if the buyer paid Non USD $ currency to USD $ currency

The higher fee is PayPal way to offset the Currency loss when conversion of different currency occur

View attachment 846453

That why using US base card like American express, there is no additional cost for International

So for example using PayPal Send/receiving money for G&S,

If a US resident Paid In EUR to a US resident receiving in USD, it will be 4.39% plus 49c

If a EUR resident Paid in USD to a US resident receiving in USD, it will be 2.89% plus 49c

 

[LotsOfChips]

.... Because now, when you send somebody money via goods and services over $600, that’s going to generate some tax paperwork for them at the end of the year, right? They might not want the headache. Discuss this with your seller!

$600 per year (total of all transactions), not $600 per transaction.

 

[buffalojim]

I feel bad for all of you that have to use or want to use G&S for transactions. I get it. This all seems like a paperwork nightmare. All aboard the hot mess express!

 

[Dodger]

I just had a transaction with @Gear recently and there were some changes to the PayPal platform that did not give me an option to confirm sending USD. Because it was US to Canada, PayPal was going to charge me a $.99 fee to send international F&F. I messed around with trying to figure out the G/S fee so I could pay appropriately and not have @Gear get hit with any fees, but my math skills were fried. I just took the $.99 hit on my side via F&F. Figured my one time fee was cheaper than all the fees he may rack up with all the transactions he completes.

 

[Himewad]

I just had a transaction with @Gear recently and there were some changes to the PayPal platform that did not give me an option to confirm sending USD. Because it was US to Canada, PayPal was going to charge me a $.99 fee to send international F&F. I messed around with trying to figure out the G/S fee so I could pay appropriately and not have @Gear get hit with any fees, but my math skills were fried. I just took the $.99 hit on my side via F&F. Figured my one time fee was cheaper than all the fees he may rack up with all the transactions he completes.

I believe PayPal will always stick the person sending money internationally with this fee. There's no way to get around it. But that's a fee charged to the sender. Not the receiver.

 

[Dodger]

I believe PayPal will always stick the person sending money internationally with this fee. There's no way to get around it. But that's a fee charged to the sender. Not the receiver.

Yep - couldn’t get around it. And I know Chris does great work, so I was happy to pay the fee so he received payment in full with no mistakes on my end in trying to figure out the G/S fee.