PayPal Business Account UK: Fees and Store Integration
No7 Engineering Team
Growth Architecture Unit
A PayPal business account is the PayPal account type a company uses to take payments for goods and services. PayPal's sign-up page describes three steps: create a login, link your bank account to accept payments, then start selling. For a UK online store, the two things that matter after sign-up are what each sale costs and how the account connects to your platform. Every fee below comes from PayPal's UK merchant fees page, last updated on 1 October 2026; PayPal lists upcoming fee changes on its Policy Updates page, so check it before you rely on a number.
Why a store needs a business account
PayPal calls any payment you receive for selling goods or services, or after you request money, a commercial transaction, and commercial transactions carry the merchant fees below. Shopify's set-up flow also assumes a business account: its PayPal set-up guide tells merchants who do not have a PayPal professional business account linked to their store email to add that email to an existing PayPal account or sign up for a new business account with it.
PayPal business fees in the UK (October 2026)
| Payment type | Fee |
|---|---|
| Domestic commercial transaction (PayPal Checkout) | 2.9% + £0.30 |
| Buy Now Pay Later (excludes PayPal Credit) | 3.9% + £0.30 |
| Advanced credit and debit card payments (blended pricing: Visa, Mastercard, CUP, Diners, Discover) | 1.2% + £0.30 |
| Advanced card payments, American Express | 3.5% |
| Extra fee when the buyer is in the EEA | +1.29% |
| Extra fee when the buyer is in any other non-UK market | +1.99% |
| Converting a business balance to another currency | 3% above the base exchange rate |
| Chargeback fee | £14.00 |
| Standard dispute fee | £12.00 |
Payments where both sides are registered in the UK, Guernsey, Jersey or the Isle of Man are treated as domestic. The £0.30 fixed fee applies to payments received in sterling; other currencies have their own fixed fee. You can request the optional tiered rate plan, subject to updated terms, which PayPal prices on the previous calendar month's eligible volume: 2.9% up to £4,000, 2.4% above £4,000 up to £8,000, and 2.1% above £8,000, each plus the fixed fee. It only applies once PayPal confirms your enrolment.
What a PayPal payment costs: worked example
| £50 order paid with PayPal Checkout | Calculation | Fee |
|---|---|---|
| Buyer in the UK | 2.9% of £50 + £0.30 | £1.75 |
| Buyer in the EEA | £1.75 + 1.29% of £50 | about £2.40 |
| Buyer elsewhere, for example the US | £1.75 + 1.99% of £50 | about £2.75 |
International sales cost noticeably more, and refunds and disputes have costs of their own, so model fees on your real order mix rather than the headline rate.
How to connect PayPal to Shopify
On Shopify, PayPal runs as PayPal Express Checkout. Shopify creates a PayPal Express Checkout account automatically when you create your store, using your sign-in email, and you can start receiving payments if a PayPal account already uses that email. To issue refunds and capture payments manually, you need to finish setting up the PayPal account. Only the store owner can edit the PayPal Express details, and you can deactivate PayPal from the Payments settings if you do not want to offer it. Shopify notes that PayPal Express Checkout is not available to merchants in France or the United States, where Shopify says merchants can use PayPal Wallet through Shopify Payments instead.
How to connect PayPal to WooCommerce
WooCommerce stores use the WooCommerce PayPal Payments extension. Its documentation covers setup and onboarding, Pay Later, Advanced Card Processing, Apple Pay, Google Pay, local payment methods, subscriptions, saved payment methods and shipment tracking, so one plugin can provide the PayPal button, card fields and wallet payments together. Test refunds and order status changes on a staging site before you switch it on in production.
Engineering checklist for PayPal on a store
- Use the right account. Connect a business account registered to the company that issues your invoices, not a personal account.
- Match currencies to your markets. If you sell in euros or dollars, compare receiving in that currency with converting your balance, which costs 3% above the base exchange rate.
- Reconcile fees. PayPal deducts fees per transaction, so your accounting integration needs to record gross sales, fees and refunds separately.
- Plan for disputes. Each chargeback costs £14 and each standard dispute £12. The WooCommerce extension can send shipment tracking to PayPal.
- Test the full flow. Run a domestic order, an international order, a partial refund and a cancelled order in sandbox or staging before launch.
Comparing PayPal with other gateways? Our Adyen vs Stripe guide covers the card processors, and our 3DS2 and Strong Customer Authentication guide explains the checkout rules every UK payment flow must meet. Our Shopify integrations and WooCommerce development teams can set up and test PayPal on your store.
Frequently Asked Questions
The questions buyers and engineers ask us most about this topic.
How do I open a PayPal business account in the UK?
PayPal's sign-up page lists three steps: create a login, link your bank account to accept payments, then start selling.
What are PayPal business fees in the UK?
From PayPal's UK fees page, last updated on 1 October 2026: 2.9% + £0.30 for a domestic PayPal Checkout payment, 3.9% + £0.30 for Buy Now Pay Later, and an extra 1.29% for EEA buyers or 1.99% for buyers in other markets. Chargebacks cost £14 and standard disputes £12.
Does Shopify need a PayPal business account?
Shopify creates a PayPal Express Checkout account automatically from your store email, but to issue refunds and capture payments manually you need to finish setting up PayPal. Shopify's guide tells merchants without a linked PayPal business account to add their store email to an existing account or sign up for a business account.
How much does PayPal charge on a £50 sale?
For a UK buyer paying with PayPal Checkout, 2.9% of £50 plus £0.30, which is £1.75. An EEA buyer adds 1.29%, about £2.40 in total, and a buyer in another market adds 1.99%, about £2.75.