How much tax does PayPal take

PayPal does not take a direct tax; it charges transaction and conversion fees, usually 2.99% to 3.49% plus a fixed fee on standard domestic business transactions.

What you pay depends on whether the payment is domestic or cross-border and whether it is a business or personal transfer.

• Domestic goods and services: Sellers pay 3.49%, or 2.99% depending on the merchant tier, of the transaction amount, plus a fixed fee of around $0.49 or the local equivalent.
• Cross-border fee: International payments carry an extra 1.5% surcharge on top of the standard merchant rate.
• International business accounts: In some markets, such as India, business accounts pay a flat 4.4% transaction fee instead.
• Currency conversion: When money is converted between currencies, PayPal adds roughly 3% to 4% above the base exchange rate.
• Friends and family payments: Domestic personal transfers are free when funded from a bank account or PayPal balance.
• Card-funded personal transfers: Paying with a card brings a percentage plus a fixed fee, and international sending carries a fee of up to $4.99.

Because these costs stack, a payment that is both international and converted into another currency can lose far more than the base transaction rate. Reviewing PayPal pricing for your country and transaction type shows which of these fees apply to a given payment.