Thread: "Personal" method and paypal...

So paypal has gotten stricter about sending personal method for purchases. I just wanted to share this as this change will affect many of us. I for one will see what the procedure is for allowing some of my friends that are on bhuz to be able to send personal method, but from now on those that I cannot get approved will have to pay fees. Sorry gals, but it seems that is just the way things will have to be now.



"Thank you for using PayPal to accept money with your PayPal account. We recently changed our pricing structure so that you can receive money from friends and family for personal payments within the US for free. Personal payments are for sending a gift, splitting a lunch bill, paying your share of the living expenses, and everyday exchanges of money between friends and family.

If you receive money as a payment for a purchase or service, you will continue to incur fees.

We've noticed that some of your customers are sending you personal payments for purchases of items or services. Unfortunately, this is against our rules, and we need your help correcting it. Please don't ask or allow your customers to use personal payments to pay for their purchases.

If we continue to see such activity, we may have to disable your ability to receive free personal payments, and then you will pay fees for all money received through PayPal."

I got the same message/warning too about 2 months ago. The person sending me the money thought it would be a nice gester to send payment for a costume as a personal payment and I got the message from Paypal. It wasn't her fault but I am now very careful to either charge for paypal fees or pay them myself. I would really hate to be kicked off PayPal.

Part of my 2012 goals is keep better track of my expenses both personal and business so I just opened a 2nd paypal account. They will let you have one business account and one personal account.

It's generally better not to use the personal method for purchases for a couple of reasons.

1) As a buyer, you have NO recourse through Paypal if you've lied about your purchase being a 'personal gift' in order to cheat them out of their fees.

2) Karma. Paypal deserves to be paid for providing a service, just like anyone else.

What Lauren said.

Also, there is a price to doing business. These kinds of fees are tax deductible, if you're doing your taxes from year to year. It's the cost of doing business.

I've had paypal for about 10 years now, and upgraded to business about 7 - 8 years ago. It's a nice neat method to keep track of what I'm spending on costumes, music, how I'm being paid for my services and makes a nice easy way for people to pay me, without them having to give me their credit card numbers.

And I think this is something we often don't think about. As a small business, if I get audited, I'm certainly going to give the information about *who* I paid money to for my stuff. If you are above board, no harm no foul, if not, what happens if *you* get audited? (generic you, of course)

Originally Posted by Lauren_

It's generally better not to use the personal method for purchases for a couple of reasons.

1) As a buyer, you have NO recourse through Paypal if you've lied about your purchase being a 'personal gift' in order to cheat them out of their fees.

2) Karma. Paypal deserves to be paid for providing a service, just like anyone else.

I agree. When asked to pay using Gift or Personal I tend to avoid that transaction. I think the seller should include the Paypal fees in their posted price. If someone suggests that readers feel free to make an offer I presume the fees are included if the offer is accepted. It is part of doing business. But that is only my point of view. Paypal is providing a service. Most of the time it is a convenience to have Paypal as an option. Not perfect but few things are. I relate it to being expected to teach and perform for free - simply not acceptable.

Thanks for all your comments ladies. I am more wary now of how to use PayPal. I am in the process of having about 10 friends approved who I regularly do business with. Fingers crossed...

Originally Posted by Jennifer Bellydance

Thanks for all your comments ladies. I am more wary now of how to use PayPal. I am in the process of having about 10 friends approved who I regularly do business with. Fingers crossed...

What do you mean by having your friends approved?

Originally Posted by ssipes

What do you mean by having your friends approved?

under the descriptions on when yo use personal or payment, personal was described as being used for friends family, etc... I have body doubles, and close friends turned clients (for costume work, web design, and other things) that are always paypaling with me back and forth throughout the year(s). I am in the process of seeing if they approve my request to allow these select few to be considered for gift method as the qualify as friends.

Originally Posted by Jennifer Bellydance

under the descriptions on when yo use personal or payment, personal was described as being used for friends family, etc... I have body doubles, and close friends turned clients (for costume work, web design, and other things) that are always paypaling with me back and forth throughout the year(s). I am in the process of seeing if they approve my request to allow these select few to be considered for gift method as the qualify as friends.

I still don't understand. It sounds like they are paypalling you because they are purchasing things from you? If so, the transactions should be done as payments, not gifts.

Or are these really 10 people who regularly gift you money?

Originally Posted by ssipes

I still don't understand. It sounds like they are paypalling you because they are purchasing things from you? If so, the transactions should be done as payments, not gifts.

Or are these really 10 people who regularly gift you money?

whoops didtn mean to sound vague! These are about ten buddies of mine that we regurlary rotate items amongst our group. So yes its purchasing but from one another but it is def within our circle. Let's say for example one of my pals has a beautiful costume she wants to rotate, she will offer it to us only and then friend B buys it, lets say friend B decides to rotate and I decide to buy and then it keeps going. Stuff like that , where if paypal decides to approve my request.. ok. If not ..then I understand too, but within our circle we are always paypaling back and forth with stuff like that and we know eachother personally except for about 3 so it just seems like a unique case. I guess it will be up to paypal in the end, but either way I def know much more about paypal now and it was a good experience.

My dad just sends me an old fashioned check for my birthday once a year. I always get charged a fee whenever i receive money from PayPal. If i sell something I do charge the fee but i add it to the price- I never use PayPal for personal or gift feature.
I agree with Kina, Lauren on what they said.
There are tax laws depending on your state regarding this. In the state of CT, I was a bit floored on the new form because they changed the sales tax in July 2011 midway though tax year. I have to account for 3 tax rates- my out of state purchases, My purchases before July 2011 and after July 2011. I owed some money in sales tax not bad,with the deductions I did. (I sell jewelry at holiday time at local craft fairs)
PayPal fees are minimal depending on your purchase. When you purchase pre- registration for workshops in my area there's a fee to do it PayPal.