Questions about taking international payments...?

[jacobacro]

I am an acrobatics teacher based in the USA and I am setting up an acrobatics workshop on the island of Sicily.  People are paying me from all over Europe.  I am trying to do this right and pay the least in Paypal fees possible.  

1.  What currency should I collect in?  My home currency is USD.  Many are paying in Euros.  Say someone pays me in Euros and I need to issue a refund.  Is it just as easy to refund them if I have the currency converted to US.  I mean, if their money is converted from Euros to Dollars when they pay me, can I still issue a refund and the fee is refunded and the student gets their money back in Euros?

2.  I am using a Paypal business account.  Do I have to pay the 4.4 percent fee in every transaction?  When I collect money a 4.4 percent charge is deducted.  After the acrobatics workshop is over I have to send half of the money to my friend who is based in Italy and his main currency is Euros.  When I pay him his half do I have to pay the 4.4 percent transaction fee again?  That money would have the 4.4 percent fee applied to it twice.

-Jacob

[sharpiemarker]

@jacobacro 

The best way is to invoice in USD across the board in the amount you want and receive it in USD if the receiving PayPal account is US based and only be charged the 4.4% + 30 cents PayPal fee and let the buyer deal with the currency exchange/conversion rate, otherwise you'd be dealing with both the PayPal fee and the exchange rate/conversion fees.

Yes, for receiving payments you are charged the PayPal fee. 2.9% +30 cents for domestic payments and 4.4% + 30 cents cross border/foreign PP account payments. PayPal is providing a service so we need to pay them for it same as any other payment processing service. You can include the expense in your service price. Say, your service is $50, charge $55.

No, you do not pay the fee again when you send to your partner in Italy his cut, the recipient of the payment will be charged a fee.

Now on the other hand, you can open foreign currency balances within your PayPal account so if you invoice and accept foreign currency in your PayPal balance, it will remain there in that foreign currency:

You can also refund or send in foreign currency granted if you have money held in foreign currency balances.

More info about working with using multiple currencies:

https://www.paypal.com/us/webapps/mpp/ua/useragreement-full?locale.x=en_US#multiple-currencies

Please note that PayPal no longer refunds their PayPal fee so that amount will be deducted too as well out of pocket on the refund so always make sure you have enough in that foreign currency balance to refund by converting some money from a different currency balance to the foreign currency balance.