Does PayPal charge GST

Yes, PayPal charges 18% Goods and Services Tax (GST) in India, applied to the transaction and currency conversion fees it collects.

The GST is not charged on the full amount you receive. It is added only to the service fees, which for international payments received in India include a 4.4% transaction fee plus a fixed $0.30 and a currency conversion markup of about 3% to 4%.

• Charged on fees only: The 18% GST is calculated on the payment platform's fee, not on the invoice or payment total. If the transaction fee is 4.4%, the 18% GST applies to that 4.4% portion.
• Monthly GST invoice: Account holders in India receive one consolidated GST invoice each month covering the tax on fees.
• Input Tax Credit: Businesses registered under GST can generally claim Input Tax Credit (ITC) on the IGST charged on the platform's fees, as long as the correct GSTIN is saved in the account profile.

The user agreement makes each account holder responsible for working out which taxes apply to the payments they send or receive, so checking with a tax advisor about GST registration and ITC eligibility is sensible.