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Does PayPal charge tax

PayPal itself does not charge tax on its transaction fees, but the fees you pay to PayPal are subject to applicable goods and services tax (GST) in India. When you receive international payments through PayPal, you pay currency conversion fees and transaction fees, and GST is added on top of those charges. Additionally, any income you earn through PayPal is taxable under Indian income tax laws, and you are responsible for reporting and paying those taxes.

If you want to avoid high currency conversion markups and multiple fee layers, consider using PayPal alternatives like Skydo, an RBI-authorised platform built for Indian exporters and freelancers. Skydo offers transparent pricing, competitive exchange rates, and faster settlement times, helping you keep more of what you earn while staying compliant with Indian regulations.

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