PayPal Payments

[SC Events]

Hi All,

Got a bit of an issue with a payment that has been made...

I had a chap book me for his Wedding Reception which is coming up soon. When he asked about paying via PayPal, I said "Please can you only pay the £50 deposit via PayPal as it charges us quite a bit" to which he agreed.

Anyway, the next morning I got an email from PayPal to say £100 had been transferred in to my PayPal account, so I logged in and there was the £100 minus PayPal's percentage!

He then sent me an email to say it had been transferred to which I replied saying "Thank you, it is showing in my account, however my deposit is only £50 and have been charged more due to you transferring over £100" - Worded better than that though!!

A few weeks later, I got a phone call asking me how I would like him to pay the outstanding balance, to which I said "You can either transfer it via Online Banking, send me a cheque or pay cash at the beginning of the night. Please do not send it via PayPal as it charges us quite a bit."

So what happens next...? You guessed it, he has sent the payment via PayPal, so I have now been charged PayPal's % on £250, which has :Censored: me off a little bit, as I have not received the full fee after telling him two or three times NOT to pay it via PayPal!!

In total, I have received about £338 instad of £350...Yes, I know it's only £12, but £12 is £12!!

There was a note on my website saying all PayPal payments are subject to a 4% surcharge but you have to manually tick the option during the payment process, as it won't work automatically for me anymore! :(

So, what should I do?

Should I contact him and ask for £12 as it clearly stated on my website that there was a 4% surcharge or do I write it off?

Thanks in advance.

[Dynamic Entertainment]

I didnt think you could pass the Paypal charge on...sure its against their T&C's.

Anyway all Paypal fees are tax deductable so write it off to tax mate ;)

[DeckstarDeluxe]

Take it on the chin. How much would a card machine of charged you?

[SC Events]

Take it on the chin. How much would a card machine of charged you?

Don't know because I don't have one.

It's just bugged me because I quoted him £350 and I already had to absorb the cost of the £100, then to go and do what I told him not to has just annoyed me a bit!!

...Sorry if my posts seem a bit angry tonight...i'm just wound up about a few things atm!

[Dynamic Entertainment]

Don't know because I don't have one.

It's just bugged me because I quoted him £350 and I already had to absorb the cost of the £100, then to go and do what I told him not to has just annoyed me a bit!!

If you dont want them to do it...dont give them the option ;)

[SC Events]

If you dont want them to do it...dont give them the option ;)

I'm anymore as soon as he paid by PayPal, I removed it from my website...Online banking, Cheque or Cash from now on...and i'll be doubly glad when Cheques are phased out! lol :P

[Sapphire Disco]

Is there still a charge if the client ticks the gift box, rather than payment for goods or services ?

[funkymook]

Is it possible he didn't realise it was going via Paypal? Not everyone is used to on-line payments, could've been genuine ignorance on his part.

Otherwise he just doesn't do as he's told! :D

[Shakermaker Promotions]

I don't think they take anything if it is a 'gift'.

[DeckstarDeluxe]

Or put your prices up by a tenner.

[SC Events]

Is there still a charge if the client ticks the gift box, rather than payment for goods or services ?

I knew there was no charge if you send payment as a 'gift', but I have set up a business account with PayPal and so I thought if I did that, I might get an email asking for their money!


Or put your prices up by a tenner.

What the point? If I put my prices up £10, they increase for everyone. I can't just say "Oh you want to pay by PayPal...add a tenner on to your quote lol"

If I increase my price, it could work out worse! Let's say I increase my price by £10 to £360 and everyone pays by Online banking, I get the full £360. If they pay by PayPal, i'll get charged even more as there is even more money going through there!

[Alex]

Ok to clear up the paypal thing...

Paypal charges 3.4% + 20p transaction fee.... upto a certain value per month.
After that it's something like 3.1% then 2.9% etc...

Most of us though will be on the 3.4% band.... which I will admit IS expensive however weigh this up to a card machine (Tarrifs vary depending on your card machine provider ) ...

Transaction fee's on card machines vary between 2.6% and 3.4%... and include a transaction fee as well.
On TOP of that you have the hire rental and the cost to have a internet merchant account (Again these vary across the board)

----
Charging more to use paypal - This is against their terms and conditions and you can be black listed for doing this (I know this as fact, as I got caught out doing this... I had to open a new account and start afresh)
However you can possibly get around this by calling is an "Administration Fee"... however I don't know how legal that would be!??

Payment By Gift - Yes this is a free method of transferring money between paypal accounts!! But only between two paypal accounts.
A customer can NOT go on and pay by card... and make this a "gift" unfortunately.

If you want a customer to "gift" you... they will need to log into their paypal account, click on SEND MONEY, enter your paypal email address CORRECTLY!!! and the value... then they select gift from the options below.
The problem with this is.... If if't s a regular method of payment to you, Paypal may get suspicious and suspect money laundering ( Again this has happened to me, my account was suspensed for 6 weeks while they investigated me! )

Conclusion.... you either offer payment by card/paypal and accept the fees ( which are cheaper than most card machine providers.. in my opinion )... or don't offer online payment.

Additional Note: There is one thing you might want to try.... http://www.skypay.co.uk/ I've seen these guys about for a while now and I am tempted to give them a go! Seem very cheap though which worries me!!!

[marting]

Is there still a charge if the client ticks the gift box, rather than payment for goods or services ?

I made a payment as a gift last night and had the choice of paying the charge or not.

[Corabar Entertainment]

...But it's NOT a gift, so don't do it! They WILL catch you out.

Same as I said only a day or two ago when this came up.... if you are running a business, then run a business, and don't keep looking for 'dodges'.

Scott - just to clarify, that wasn't directed at you and your problem, which I agree is a pain in the bum!

With your problem: back to my old question... what do your T&Cs say? What payment methods are stipulated? If you can fall back on your contract, you'll then have to make a decision as to whether or not you either upset a client and request the additional funds, or just take it on the chin and chalk it up to experience.

[Jason]

Look at other payment options before you rule out PayPal.

Cheque...
I guess you could post it (1st class stamp+envelope, a few days extra delay)
Or.. take to the bank - easy if you regularly walk past one. For me, its parking in Borehamwood town center in lunchtime, with a 10min round trip driving.
Not a big problem, but time=money, and not much of a lunch break is something I try to avoid.

Bank Transfer..
Not all clients bank online, this is my preference, but I don't enforce it on anyone.

Card...
Monthly cost and around 2% transaction fee (this varies). It could be worth it, but obviously some kind of monthly outgoing. FSB membership has some good deals, but these are not free. Probably worthwhile for the guys that hire out gear or busy full-timers.

So, apart from bank-transfers, all attract some kind of cost.
If a client wants to book me, I'm certainly not going to risk the booking by making their life harder.


I took a £400 wedding where they paid via PayPal (no booking fee, they paid a few hours after meeting). I wasn't entirely happy with paying £13.80 in fees, but even a card system would cost me 2% in fees (so £8) with the added cost of monthly fees.

In the ecommerce forum I'm in, people moan about PayPal's fees, but until you have higher turnover, its really not too bad (and PayPal's fees do reduce if you hit specific levels of turnover).

In an ideal world, everyone would use bank-transfer, it would be instant and no one would need to use PayPal, Cheques or even cash.

Its also worth re-iterating (from a previous post) that these costs are also tax deductible - so keep a track of them, and the £13.80 in costs does not mean £13.80 lost profit in my pocket - its £13.80 off my tax bill!


Its a shame Google Checkout is not as competitive as it used to be.
When I ran a few online stores, they were charging 0%, then 2.5%... now its the same as PayPal.
One positive point on Google Checkout, is that the funds are automatically placed into your account a few days after the transaction - and its a fairly nice system, so whilst no cost saving, its worth considering.

For financial transactions, clients do like a reliable name (PayPal, Google etc), and these systems have better client protection (ie the merchant does not have access to their card details)

So, if you remove PayPal as an option, you're making things harder for clients and posting a cheque takes more effort than an online payment.


Simply put, I would not risk a client relationship over a few pounds (which is really what this will be on your bottom line)

Jas

[yourdj]

Leave the payment as it is (is it tax deductible) :confused: What's done is done its only £12 after all.
I lost over £1000 last year on Paypal charges and could get that back then :eek:

Do not give details for Paypal in future. Just bank transfer.

Forget cheques :p

I would also not take payment on night if I could help it - clients are understanding and would rather get the payment out the way - especially for weddings.

[Jason]

Leave the payment as it is (is it tax deductible) :confused: What's done is done its only £12 after all.
I lost over £1000 last year on Paypal charges and could get that back then :eek:

Do not give details for Paypal in future. Just bank transfer.

Forget cheques :p

I would also not take payment on night if I could help it - clients are understanding and would rather get the payment out the way - especially for weddings.


Hi Toby...
yes- these are expenses/cost of sales. The same as bank charges for your business account (many banks charge for banking a cheque). It all adds up.

They are deductible (but check with your accountant/tax office and don't rely on forums for tax advice! lol).

Jas

[Vectis]

don't rely on forums for tax advice!

True... especially when folks say stuff like...


the £13.80 in costs does not mean £13.80 lost profit in my pocket - its £13.80 off my tax bill!


:o


It's actually £13.80 which you can add to your 'expenses' column, which in turn MAY reduce your tax "bill" (aka liability) depending on other circumstances. However for your typical Joe with uncomplicated affairs earning more than the personal allowance and less than the higher-rate tax bands, the £13.80 would result in a reduced tax liability to the tune of around £3. So think of it as a direct cost of around £11.


A good few years ago when I started to offer PayPal for payments, it quickly became apparent that a large proportion of clients were taking up the option. So at my next price review, I did a few sums and arrived at the conclusion that a 2% increase in ALL prices would, over the course of a year, cover the costs of using the service.

It's very convenient, easy to implement electronically and trusted.

I've also dabbled with Google Checkout and Nochex but each had their drawbacks - GC for requiring the customer to have a Google account (not sure if this is still true) and Nochex suffered from a lack of reputation, so hardly anyone used these and I ultimately binned them once GC charges started to increase.

Bank Transfer is fine if

a) the client has the funds available
b) they enter a traceable reference

The number of times I've received a payment with an incomprehensible reference from an account with a surname that doesn't match the booking client's, you wouldn't believe. At one stage when I was charging a flat £50 deposit, I would ask customer A to pay £49.99, B to pay £49.98 and so on just so I could cross-reference the payments :daft:


PayPal (or a terminal) is a MUST if you want to allow clients to pay by credit card (ie. "on tic"), and let's face it, in these constrained times I think you'd be mad to effectively rule these folks out. At the very least it's going to lead to more short-notice bookings if all your clients need to have the readies before you'll take their business :cool:

[Steve the DJ]

So at my next price review, I did a few sums and arrived at the conclusion that a 2% increase in ALL prices would, over the course of a year, cover the costs of using the service.

Tip top advice.

Taking payments is a business expense that isn't going to go away, work it into your annual costs and get on with more important things. :)

[Charlie Brown]

It's not the end of the world.

It's all part of it.

[hammy]

Suprised no one has said yet

Refund the amount back to the client minus the £50 and paypal give you back the fee they took from you, Simples ;)

[Corabar Entertainment]

...But is it worth upsetting the client?

[Charlie Brown]

...But is it worth upsetting the client?

Not for the sake of a tenner, no.

[Marc J]

Forget the "gift" option, there's now an option in PayPal for (something like) "money due to you for services". They don't charge a percentage on that. If it's not the case, or clearly for goods, don't do it too often!

[James]

This happened to me a few weeks ago, asked the customer to do a bank transfer, she paid it into paypal, paypal charged me £15.00

I e-mailed customer, and said something along the lines of 'don't worry about it' you've paid what's outstanding as far as i'm concerned.

secretly hoping she'd pay the £15 anyway, but she never