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When it comes to sending and receiving money online, PayPal is one of the most trusted options out there. It has been around since 1998, and more than 250 million users have accounts on this platform.

PayPal is the best option when it comes to sending/receiving money from family and/or friends or if you run a business. This might have you asking how to avoid PayPal fees when receiving money, as well as how to avoid PayPal fees when sending money.

Different Types of Fees

Before answering the questions of how to avoid PayPal fees when receiving money and how to avoid PayPal Fees when sending money, it’s important to understand the different types of fees that PayPal charges.

Keep in mind that PayPal is a for-profit business. They have employees that they have to pay and to do this, they need income of their own. A lot of that money comes from the fees that they charge. This money also pays for their bills and other expenses.

When it comes to the different types of fees that PayPal charges, it depends on several factors, including:

  • The type of account you have
  • The type of transaction you are conducting (personal or business)
  • The type of currency you are dealing with

You can send and receive money internationally with this platform, but there are PayPal fees for receiving money internationally. These vary depending on the type of foreign currency. More often than not, the fee is fixed, but to know what that amount is, you’ll have to refer to PayPal’s fee page.

If you are wondering what the difference is between PayPal vs Venmo fees, there are some things to consider.

Both Venmo and PayPal allow you to send money for free if you are using your linked bank account to fund the transaction. If you are using a credit card, again, both platforms charge about the same fee, which is right around 3% of the total transaction.

The difference between PayPal vs Venmo fees can be seen when it comes to debit cards. Venmo doesn’t charge to use a debit card to fund a purchase, while PayPal does (see below).

Business Account Fees

If you happen to have a business account on PayPal, the fees collected when sending or receiving money will vary. Typically, in the U.S., you will have to pay 3.7% of the total transaction plus $0.49.

Should you have customers outside of the U.S., when wondering how much the fees are, in the U.S., these generally are 3.9% of the total transaction plus the fixed fee that PayPal has decided based on the currency type.

If you want to know exactly how much the fees will cost you, you might consider using a PayPal fees for receiving money calculator. This can be used for both domestic and international transactions to help you plan accordingly.

Personal Account Fees

When it comes to a personal PayPal account, there are fees associated with this as well. If you live in the U.S., the breakdown of fees for a personal account is as follows:

  • No charge if you are buying a product from a business that is based in the U.S. or Canada.
  • If you are sending money and it is funded from your PayPal balance or the bank account linked to your PayPal account, there is no charge.
  • When sending money funded by a credit/debit card or PayPal credit, there is a fee of 2.9% of the total transaction plus a fixed fee.
  • If you transfer money from your PayPal account to your bank account, this is usually free, unless you do an Instant Transfer, and then you are charged 1% of the amount transferred, up to $10.

Some of the other fees that you might encounter with a personal PayPal account involve foreign currency, then a conversion fee will occur. In the U.S., this fee is 3.5% of the transaction total.

Again, you always have the option of using a PayPal fee for receiving money calculator to find out exactly how much money will be taken out of your account to cover these costs.

How to Avoid PayPal Fees When Receiving Money

Now that you have a better understanding of the PayPal fee structure, you are probably wondering how to avoid PayPal fees when receiving money. There are a few things you can do to reduce your costs, including the following:

1. Invoice Using Friends and Family

Whether you have a personal account or a business account, one of the features of PayPal is the ability to send an invoice. If you click the Friends and Family option when requesting money, you won’t have to worry about paying any fees.

When asking how to avoid PayPal fees friends and family is a good option if you are actually requesting money from friends and family, but it can also work if you are a freelancer and are sending an invoice to clients.

However, there is a downside to using this option, including the fact that the person sending you the money loses their payment protection. This may not be a big deal when it comes to smaller amounts of money, but it could make the buyer nervous when dealing with large sums of money.

If this is the route you want to take when invoicing clients, make sure they are comfortable with the option so that you can avoid having to pay fees when receiving money.

When it comes to asking how to avoid PayPal fees when sending money, you can also use the Friends and Family option.

2. Add the Fee to Your Invoice

Another option you might consider when learning how to avoid PayPal fees when receiving money is to add the fee into your invoice.

This is when using PayPal fees for receiving money calculator comes in handy. You’ll know exactly how much to add to your total to ensure you get your money and PayPal gets theirs.

When it comes to PayPal fees for receiving money business, PayPal is a widely accepted platform that many people use, so they are probably aware of the fees that are charged. You can add a line on your invoice that says something like “Business fee” or even “PayPal fee” and then include the amount there.

Most people won’t be too upset if you include this on your payment request, but you might consider letting them know in advance that you expect them to pay this fee. That way, they won’t be surprised when it shows up on the invoice.

3. Change Your Pricing

If you think that your customers won’t go for paying the PayPal invoice fees, then change your pricing to include the fee without letting them know. This allows you to present a number that covers your time and effort, as well as takes care of other costs, but your potential clients/customers will just see one number. This gives them the opportunity to decide if that expense will fit into their budget or if they need to shop elsewhere, without having to worry about added costs or fees.

Changing your pricing can simplify the process for both you and your customers, as well as ensure you have the funds to cover the PayPal fees and get the money you deserve for your goods or services.

4. Change Your Payment Structure

Another option you have when it comes to reducing PayPal fees for receiving money business is to change your payment structure. This is especially beneficial if you have recurring charges that your customers have to pay on a regular basis.

For example, if you currently receive payments for services on a weekly or bi-weekly basis from your customers, consider changing this to a monthly payment schedule. That way, you’ll only have to pay the fee once per month.

When wondering how to avoid PayPal fees when receiving money, you won’t be able to get rid of the extra cost entirely, but you’ll be paying a lot less. This could save you in the long run, and it may be more convenient for your customers.

If you are wondering how to avoid PayPal fees when sending money, this might help there as well. Again, should you find yourself making regular payments for services rendered, then reducing your payments to once a month will decrease the number of fees you have to pay, which could save you money.

Keep in mind that this only works for a business account. When it comes to your personal account and wondering how to avoid PayPal fees friends and family, you have different options to choose from. Even if you send your friends or family money multiple times a month, using the Friends and Family option ensures you never have to pay fees.

Another thing to keep in mind is that this method only works for payments that are made on a regular basis. If you have an online eCommerce business where you sell individual products to customers, you won’t be able to avoid PayPal fees using this strategy.

5. Claim the Fees on Your Taxes

If you are wondering how to avoid PayPal fees when receiving money, one thing you might consider as a business owner is to claim the fees on your tax return. These are considered an inevitable cost for business operations, so this could help you earn some tax deductions.

To be able to include this information on your tax returns, you’ll need to keep track of the PayPal fees paid throughout the year. There are different software programs that can help with this endeavor, including:

6. Get a PayPal Cash Card

A PayPal cash card could be advantageous when asking how to avoid PayPal fees when receiving money. This card functions like a debit card and allows you to spend your PayPal funds anywhere and everywhere. You can even withdraw cash from an ATM if you prefer.

If you have this card, you don’t have to worry about maintaining a minimum account balance, you don’t have to go through a credit check, and there are no monthly fees or transaction fees.

7. Only Accept Specific Currencies

Another thing to consider when wondering how to avoid PayPal fees when receiving money is to only accept payments in your native currency. This will prevent you from having to pay the conversion fees for foreign currency.

If your business is based in the U.S., then requesting that you are paid in U.S. dollars isn’t unreasonable. There may be customers that decide they don’t want to abide by your payment rules, but that’s a choice they get to make.

You have to determine if paying the foreign currency fees is worth it. If you don’t make a lot of sales outside of your country of business, then paying these fees may be more costly than they’re worth. Again, when it comes to a way to avoid PayPal fees, this is one that will help with that endeavor.

8. Be Aware of Cash Flow Needs

When it comes to asking how to avoid PayPal fees when sending money, you’ll want to be aware of your cash flow needs. Since it costs to instantly transfer funds to your bank account from your PayPal account, try to do this as infrequently as possible.

Of course, this is easily accomplished if you have a steady stream of income and know how much to expect each month. If your business depends on individual sales and this fluctuates, knowing how much you’ll have from week to week might be a challenge.

As a business owner, you should be keeping track of incoming and outgoing funds so that you know how much profit you’re making. If necessary, set some money aside for those times when you may not have as much coming in so that you can avoid paying the instant transfer fee. Waiting a few business days to get your money will save you in the long run.

9. Open a New Bank Account

If you are taking your business international and you make a lot of sales in a particular region that uses a specific currency, consider opening a bank account in that area.

For example, say you make a lot of sales in England, but your business is based in the U.S. You might consider opening a bank account in England. That way, you can link this new account to your PayPal account and avoid paying the foreign currency transactions fees. This could also save you money when asking how to avoid PayPal fees when sending money to people within that new region.

Before taking this step, make sure you are aware of any laws and/or regulations that might be in place. Opening a new bank account in another country may impact how you file and pay for taxes. You might consider talking with an accountant or business lawyer to get the answers you’re looking for.


Avoiding all PayPal fees may not be possible, unless you opt not to use this payment platform at all. There are other options available, but keep in mind that as a business, any payment method you use will come with some type of cost. You have to decide how much you are willing to pay and how convenient you want to make the process for your customers.


Knowing how much you will be charged by PayPal helps you determine how much to charge your customers/clients for goods and services. Keeping this information at the back of your mind and including it in the price of your products benefits you and the people paying you.

The Cost of Business

Whether you are looking to create a side hustle or are starting a full-time business, using PayPal to send and receive money is in your best interest. This payment platform has been around for 20+ years and is trusted by millions of people around the world.

Like any payment platform you might consider, PayPal charges fees. The amount for each transaction will vary, but if you’re wondering how to avoid PayPal fees when receiving money, here are some things you can try:

  • Invoice Using Friends and Family
  • Add the Fee to Your Invoice
  • Change Your Pricing
  • Change Your Payment Structure
  • Claim the Fees on Your Taxes
  • Get a PayPal Cash Card
  • Only Accept Specific Currencies
  • Be Aware of Cash Flow Needs
  • Open a New Bank Account

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