Fees I was charged for services

[allenface]

I recently direct invoiced a Canadain Sports Network for a job I did in Atlanta.  They said they could pay via PayPal...but when I got the money, PayPal took a fee as if I was a seller.  Is this now the new standard for PayPal, to garnish fees from workers who performed services?

[DPCreations]

When you receive payment for goods and services you pay a fee.   This was payment for services, therefore, a fee was taken.

[allenface · Accepted solution]

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@DPCreations wrote:

When you receive payment for goods and services you pay a fee.   This was payment for services, therefore, a fee was taken.

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Sooo...this is the new normal?  Even TSN (Canadian Television Sports Network) were not aware of this policy and they pay many crews by this method.

Of course this means in the future, when billing folks who will pay by PayPal, in order to break even one must figure in the percentage for the fee based on the invoice, and add that to the cost of the invoice.  But even then that becomes convulued because then the fee will be even higher as you have factored in the fee, thereby increasing the invoice.  This business model is getting tiring and for a independent freelance cameraman such as myself, who keeps getting his rate and gear rental shaved...it me be time to look for alternatives to PP such as PaySimple or Braintree.

[Whac-A-Mole]

let me ask you a question,Mr or Ms Business-

you just get paid for performing a service,what makes you think Papal should not get paid for performing a service to YOU AND THE Network?

Like you,it has bills to pay,electric bill,labor ,IT workers are expensive,phone,lights,rent,staff,toll free numbers,computer,sit down and make a list of your bills and figure how much is Paypal's bills ?

30 cents transaction fee and 2.9-4.4% discount rate.

conversion fee is now 4 %

write this down so you dont forget.

[allenface]

Not sure who or what you think you are but your tone is less than stellar. My inquiry was just that...an inquiry. I am quite astute as the matters of business and the cost of business. However when even the client nor myself was aware of the fee structure, it comes as a bit of surprise. And it seems to be on a sliding scale. The more you bill, the higher the scale. It is exactly 4.4%, ($61 on a $1400 invoice) which is, IMO, a bit steep. These kinds of transactions, unlike sales of tangible items that necessitate an escrow and where there is a great deal of people power in play, the transactions of simple transfer is not rocket science. Me and many of my brothers and sisters in the film biz are experiencing a shaving of our services fees like never before...and we are all looking for alternatives for safe and cheaper transaction products. PP seems to think they are the only game in town and when they resort to community volunteer advisors as their customer service conduit, it gives one pause. It seems like the likely hood of more defectors is eminent.

[DPCreations]

If you think the fee is too high, then find another payment service.  It looks like you are paying a crossborder fee.

When you use PayPal trasnsfer service when billing for services performed you getting paid for goods/services.  It's clearly stated in PayPal terms of use.

Billing for services also has risks.  It is an intangible good and is not covered by PayPal seller protection (you sold the service).  It may be time to check out the full terms of use for PayPal.  Click on "legal" at the bottom of the page for more information.

[allenface]

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@DPCreations wrote:

If you think the fee is too high, then find another payment service.  It looks like you are paying a crossborder fee.

When you use PayPal trasnsfer service when billing for services performed you getting paid for goods/services.  It's clearly stated in PayPal terms of use.

Billing for services also has risks.  It is an intangible good and is not covered by PayPal seller protection (you sold the service).  It may be time to check out the full terms of use for PayPal.  Click on "legal" at the bottom of the page for more information.

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I was wondering about the cross border thing but the fine print suggests not, as there is no mention of international fees being higher.  There is a range of something like 2.5-to 4.4 or there abouts, with no real explanation that I could see, that explains that fluctuation.  Nowhere have I read in the terms a firm fee base.  If it's there is I'd love a screen grab.

And don't get me wrong.  I love the safety and longivity of PP but a floating fee system flies in the face of those of us who are trying to construct our budget for our maximum benefit.

And not so sure where the risk comes from billing for services.  As I see it, I bill and the client pays.  PayPal as near as I can see, is only the conduit with no financial steak.  They are not guaranteeing the monies...I don't think.

Anyways I'll still keep my PP account as I do buy a lot of jazz but as far as me and my collegues invoicing needs, it's apparent PP may not be the best choice.

[DPCreations]

Here's the rate table, indirectly linked from the fee section of the User Agreement.

https://www.paypal.com/us/webapps/mpp/merchant-fees#standard-transaction-fees

A business needs to always consider all fees in calculating prices to be profitable.

As for PayPal invoicing for services, I don't think it's a good idea, not because of fees but because it is a service, not a tangible item, so there is no PayPal seller protection.

Direct bank deposit is a much more secure option--and faster.

[allenface]

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@DPCreations wrote:

Here's the rate table, indirectly linked from the fee section of the User Agreement.

https://www.paypal.com/us/webapps/mpp/merchant-fees#standard-transaction-fees

A business needs to always consider all fees in calculating prices to be profitable.

As for PayPal invoicing for services, I don't think it's a good idea, not because of fees but because it is a service, not a tangible item, so there is no PayPal seller protection.

Direct bank deposit is a much more secure option--and faster.

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I mis...wrote, when I said invoicing.  I know that's not a PP service.  I meant when a client gets MY diriect invoice and usesPP as the conduit for payment.  If the fee schedule is predicable then I could tag that on, though that just brings the invoice higher and of course a higher fee, so it seems I can never recoupe the fees. 

Gotta say all this is taxing, particuicularly since this is the first time I've ever been paid by a client via PP.  The Candadian sports TV people actually asked if I took credit cards, which as an invidual I am not set up to do.  That said, I looked into that possibility and it seems the fee for that type of transaction is less than PP, so that's an option to be explored.  Thanks for clearing stuff up.

[DPCreations]

If you are invoicing for services either by mail or through PayPal it is still payment for goods/services and has the same result and risk wit no seller protection.  Per PayPal policies you cannot add a surcharge for payment fees.  Just make sure your invoice covers all of your associated business costs and expenses, non-itemized.

There would be a fee charged for accepting a direct credit card payment.

Either way, make sure you consider the fees when you determine pricing structure.