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Paypal fees?

This has already been been discussed in this community before- who should pay the fee, the commissioner or the artist? The general agreement seems to be, factor paypal fees into your initial commission price to cover it, because it is the artist who should pay the fees and not the commissioner, as by PayPal's TOS. However, there are many artists I've met who do not seem to have read/know PayPal's TOS and their prices are not factored for the fees.

What should a commissioner/artist do in a situation where, a commissioner sends money thinking an artist has factored in fees, but in fact hasn't payed what the artist was wanting (i.e., an artist wants 4.00$, they only get 3.58$)? It seems like one of those situations that could get ugly if not treated with care. Which is why so far I, as a commissioner, have been paying fees most of the time when buying a commission.

Would the artist have the right to withhold artwork until the full fee has been paid? Or does the commissioner have the right to the commission because it is the artist's own hindsight and ignorance that got them out of some money? I haven't had this situation myself yet but I feel as though this kind of thing will happen at one point or another. Is it a courtesy for the commissioner to send more money despite the TOS or should the artist, well, just suck it up because it is due to their own ignorance of the TOS?

Edit; I suppose the easiest solution for an artist who will not give you art until you pay more money is to open a dispute.

However, let's say you told them all this but they ignore your warning about the TOS. Should you report someone for breaking the TOS by making your customers pay the fees? Is there even a way to do so?
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( 82 comments — Leave a comment )
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kadaria
Aug. 15th, 2010 10:58 pm (UTC)
>who should pay the fee, the commissioner or the artist?<

I believe the way this discussion has gone in this community before is that the artist/seller is responsible for the fee as per paypal's TOS. If a seller making the customer pay for the fee, then the seller's account can be suspended.

>Which is why so far I, as a commissioner, have been paying fees most of the time when buying a commission<
It's nice of you to tip but I don't think that tips in this business are required.

>a commissioner sends money thinking an artist has factored in fees<
Then the artist is at fault for not taking 5 minutes out of their day to price something correctly and the buyer should not bear the brunt of that mistake.

>Would the artist have the right to withhold artwork until the full fee has been paid<
No, because the buyer is not responsible for paying your fees as stated before. Essentially, when you work with any kind of a credit/debit transaction the business is charged a small fee for each transaction. The same applies to paypal. If you don't want to pay fees for using their service then you need to take payment in another form.

>Is it a courtesy for the commissioner to send more money despite the TOS or should the artist, well, just suck it up because it is due to their own ignorance of the TOS<
Again, it's nice to tip but not required. The seller is paying to use paypal's service. They can suck it up.
mialattia
Aug. 16th, 2010 01:16 pm (UTC)
This comment is perfect.
(no subject) - kadaria - Aug. 16th, 2010 06:44 pm (UTC) - Expand
spiffystuff
Aug. 15th, 2010 10:59 pm (UTC)
Er, honestly I wouldn't haggle over a few dollars or cents XD
If I were commissioning someone and for some reason they decided I needed to pay paypal fees too, I would do so, but attempt to politely point out that that's against paypal's TOS.

Unfortunately some people are super sensitive to any criticism and may get upset no matter how polite you are. So maybe it'd be best to wait for the commission to be done and delivered, then I might say something like "thanks for this commission, I love it! I just wanted to give a word of feedback, though, technically it's against paypal's TOS to charge for fees. I don't mind paying it, but you might want to raise your prices to include the fees instead of charging separately. Anyway, thanks for the lovely art"

or something to that effect.
korsetkoat
Aug. 15th, 2010 11:07 pm (UTC)
A few cents either way does not harm me either, but the fees would become steeper the higher the price of the commission. I only used the small amounts because that was all I could do of math off the top of my head. xD

That sounds like a good idea, to wait until after it is finished.
(no subject) - spiffystuff - Aug. 15th, 2010 11:10 pm (UTC) - Expand
Only 3% - neondragon - Aug. 16th, 2010 03:24 am (UTC) - Expand
Re: Only 3% - lilenth - Aug. 16th, 2010 03:56 pm (UTC) - Expand
lilenth
Aug. 15th, 2010 10:59 pm (UTC)

Personally as it stands, if I'm daft and don't factor in my overheads, I'll eat the cost rather than upset a customer, this goes for any overheads, if I forget to include shipping in their final total I'll pay it myself and chalk it up to my own stupidity, the only exception is if I give them a total including shipping and they don't pay the full amount, that's a client mistake and I'll reject the payment and re-invoice in that case.

I think you're going to find it varies by artist, it is nice if you are kind enough to pay the fees but generally it should be assumed that they're factored in already as part of the overheads. (and tips are always welcome :D)

The artist has no right to with hold artwork since Paypal's terms of service make it violation to get the customer to pay the fees. If they're unhappy with the payment because you didn't pay fees (which they're not supposed to make you pay anyway, their price should cover their overheads, if it doesn't that's their problem) they really should either eat the fees themselves or refund you fully while cancelling the commission.
claytronic
Aug. 15th, 2010 11:01 pm (UTC)
I always tell the commissioner to pay the fees. I'm making art for them., they're paying me for my talents, I should not be paying their fees. I'm supposed to be making money, not paying 50 cents every time. [50 cents adds up, guys!!]
Imagine if someone bought a 20$ commission off me.
Sorry but I just lost 2$ out of my own pocket because someone doesn't wanna pay the fee. :\

Always tell em to pay the fees.
http://www.rolbe.com/paypal.htm
korsetkoat
Aug. 15th, 2010 11:03 pm (UTC)
[...]it is the artist who should pay the fees and not the commissioner, as by PayPal's TOS. This is not a question of WHO should pay them, but what happens if the artist does not know that they should pay them.
(no subject) - claytronic - Aug. 15th, 2010 11:19 pm (UTC) - Expand
(no subject) - lilenth - Aug. 15th, 2010 11:03 pm (UTC) - Expand
(no subject) - sovy - Aug. 15th, 2010 11:07 pm (UTC) - Expand
(no subject) - claytronic - Aug. 15th, 2010 11:20 pm (UTC) - Expand
(no subject) - foxhack - Aug. 15th, 2010 11:26 pm (UTC) - Expand
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(no subject) - celestinaketzia - Aug. 15th, 2010 11:46 pm (UTC) - Expand
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(no subject) - claytronic - Aug. 16th, 2010 01:00 am (UTC) - Expand
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(no subject) - claytronic - Aug. 15th, 2010 11:20 pm (UTC) - Expand
(no subject) - korsetkoat - Aug. 15th, 2010 11:26 pm (UTC) - Expand
(no subject) - claytronic - Aug. 15th, 2010 11:28 pm (UTC) - Expand
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(no subject) - nambroth - Aug. 15th, 2010 11:18 pm (UTC) - Expand
(no subject) - claytronic - Aug. 15th, 2010 11:21 pm (UTC) - Expand
sovy
Aug. 15th, 2010 11:03 pm (UTC)
Artists either factor it in to their price or just swallow the fee themselves. Businesses that have credit/debit machines also have to swallow the fee so this isn't really unusual. It is also against the Paypal TOS to charge a person for paypal fees.

Personally I just use the Payment Owed option and pay the fee and everything myself because I live in Canada and use CAD so Paypal's cut goes from 3% to ~6% (cross border and currency conversion fees) and that might surprise the artist. It saves me from the drama and sending a second payment. In the future I'll probably just tack on 5%-10% onto the commission price to cover the fees and use the purchase goods/service option because how I thought Payment Owed worked might not line up with how it actually does work. That and I get buyer protection (lol, what good that will do).

If an artist didn't account for the fees then just tell them to adjust their prices and that this first lesson is pretty cheap at about a dollar or two of their own time.
silverfalln
Aug. 15th, 2010 11:07 pm (UTC)
"Businesses that have credit/debit machines also have to swallow the fee so this isn't really unusual."

I don't think most people realize this, unless they have either worked for a small business that told their employees about this, or have owned their own business.
(no subject) - teahound - Aug. 16th, 2010 12:07 am (UTC) - Expand
(no subject) - silverfalln - Aug. 16th, 2010 01:02 am (UTC) - Expand
(no subject) - bluefantasyz - Aug. 16th, 2010 07:22 am (UTC) - Expand
(no subject) - kadaria - Aug. 16th, 2010 06:54 pm (UTC) - Expand
dripbat
Aug. 15th, 2010 11:07 pm (UTC)
Artists need to learn how to factor that into their commission prices. I have NEVER asked anyone to pay a fee ever. I have however added a tip here and there when I commission art, and I have gotten a tip here and there when people commission me. Its a very nice thing to do but it should not be the buyer's responsibility.
bladespark
Aug. 15th, 2010 11:13 pm (UTC)
This. Honestly I was startled when I first encountered an artist asking for customers to pay the fees. The thought had never so much as crossed my mind! Paying fees, just like paying the cost of my sewing machine or the cost of pencils, is just part of doing business!
(no subject) - dripbat - Aug. 15th, 2010 11:15 pm (UTC) - Expand
(no subject) - spiffystuff - Aug. 15th, 2010 11:20 pm (UTC) - Expand
(no subject) - celestinaketzia - Aug. 15th, 2010 11:41 pm (UTC) - Expand
(no subject) - gel_wolf - Aug. 16th, 2010 12:06 am (UTC) - Expand
(no subject) - kayla_la - Aug. 16th, 2010 12:15 am (UTC) - Expand
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(no subject) - gel_wolf - Aug. 16th, 2010 12:33 am (UTC) - Expand
(no subject) - ichigoneko33 - Aug. 16th, 2010 08:58 pm (UTC) - Expand
banrai
Aug. 15th, 2010 11:25 pm (UTC)
As an artist that relies on commissions as my income, I absolutely do not charge my patrons for the PayPal fee. While yes, a dollar or two here and there add up over time, I have found that people are much more willing to buy when you have nice even pricing, as opposed to saying, "X item is 22.91" or whatever.

The fees are really not that much, and honestly if you don't want to pay to use the service then how can you justify having other people pay you for your service. Especially if Paypal is the only payment method that you accept.
(Deleted comment)
korsetkoat
Aug. 15th, 2010 11:39 pm (UTC)
I would like to know how to report someone's account for TOS violation...I don't have anyone in mind but it sees like something you may need if someone has been warned of the TOS and STILL tell their customers to pay the fees.

I do not know how to do so, though. D:
(no subject) - celestinaketzia - Aug. 15th, 2010 11:42 pm (UTC) - Expand
(no subject) - korsetkoat - Aug. 15th, 2010 11:49 pm (UTC) - Expand
(no subject) - celestinaketzia - Aug. 16th, 2010 01:54 am (UTC) - Expand
(no subject) - korsetkoat - Aug. 16th, 2010 01:55 am (UTC) - Expand
armaina
Aug. 15th, 2010 11:44 pm (UTC)
Whenever I make prices for my work, I always take paypal fees into consideration. For example, if I want 5$ out of something I charge 5.50 or 6$, that way I'm sure to get 5$ of actual money after the fees have been taken out. If the commissioner decides to send more, then it's a tip.

The bottom line being, my commissioners are only responsible for the price I give them, not the amount I get after fees are removed. I see it as a form of business expense. It's not the commissioner's responsibility to worry about my business expenses.
(Deleted comment)
teahound
Aug. 16th, 2010 12:09 am (UTC)
PayPal has a fee calculator somewhere on their site... Just take the amount you want to make, type it in, then add the fee to the amount you want to make. (Or if you're like me, round up/down to an even number. If it comes out to like, $32.33 I'll just say $32 and eat that $0.33 fee myself.
shukivengeance
Aug. 16th, 2010 12:15 am (UTC)
The price that an artist quotes to a commissioner that they need to pay should be the amount they pay, end of. It's up to the artist to include the paypal fee in said quote if it bothers them so much.

If I commissioned someone, and sent them the amount they wanted, and they responded with "You were supposed to send extra to cover paypal fees!" I'd ask for a refund because I don't want to work with someone who's going to be so petty.

As for my own policy I don't care about fees and the price I ask is all my customer is required to send.
cloudpouncer
Aug. 16th, 2010 12:45 am (UTC)
I see alot of people saying to work the fees into their prices. How do you work a fee into a price when you are giving out quotes to people and are uncertain of payment method ? I simply tell customers there is a 3% fee for online transactions. If you don't call it a paypal fee you're not breaking the Paypal TOS. The other thing I see people saying is that 3-4% isn't a big deal anyways so why bother. Well it should really go both ways then but that 3-4% makes a big difference to me. If a buyer chooses other payment methods (Check, money order, cashiers check) I prefer to save them them the difference. So to me it's really the choice of the person buying the commission whether they want to pay me a extra 3% for doing business online. Now on the other hand if a artist only accepts paypal as a payment method I definitely think they should just work costs into their prices if they feel they are losing out.
celestinaketzia
Aug. 16th, 2010 01:05 am (UTC)
Yes, but the point is that 3 or 4% is your responsibility as an artist. You are the one using Paypal to make your transactions easier. (Not sure about your customers, but mine rarely ever ask for anything but PP.) As others said above, it is simply a part of running a business. Factoring the business costs into one's prices really isn't that hard. It's the same as factoring the use of markers and pens into your traditional commission costs.
(no subject) - pariahsdream - Aug. 16th, 2010 03:46 am (UTC) - Expand
(no subject) - jurann - Aug. 16th, 2010 06:38 am (UTC) - Expand
mandyseley
Aug. 16th, 2010 01:05 am (UTC)
Relevant:
http://www.rolbe.com/paypal.htm
A handy calculator to help you work the fees into your prices.

EDIT:
...and by "work the fees into your prices," it basically means:

1. Decide what you want to get paid and use the calculator above to determine what the price of your item needs to be for you to receive that amount. List that amount as the actual price right from the start. Don't tack it on at the end as "PayPal fees" or anything of the sort.

2. Do these calculations for everything you sell, even if your customer isn't paying via PayPal. PayPal specifically forbids "charging customers a surcharge for using PayPal" - which basically means, you can't charge more for using PayPal as opposed to other payment methods. Charge the same amount for all payment methods you accept, and you're pretty much golden.

Edited at 2010-08-16 01:10 am (UTC)
mandyseley
Aug. 16th, 2010 01:15 am (UTC)
Now for my more on-topic answer!

Would the artist have the right to withhold artwork until the full fee has been paid?

No. The artist gave you a price, and you paid that price. They can't just decide to increase it after the fact and hold your work hostage like that.

Is it a courtesy for the commissioner to send more money despite the TOS or should the artist, well, just suck it up because it is due to their own ignorance of the TOS?

The artist needs to suck it up. It's not a "courtesy" to allow someone to break the rules, and you shouldn't allow it to happen.

However, let's say you told them all this but they ignore your warning about the TOS. Should you report someone for breaking the TOS by making your customers pay the fees? Is there even a way to do so?

Open the PayPal dispute to get your money back in the first place, if the commissioner is refusing to deliver your artwork at all.

I believe to report a TOS violation, you would simply open a PayPal dispute about the transaction in question and mention the violation as one of your reasons for the dispute.
korsetkoat
Aug. 16th, 2010 01:36 am (UTC)
Oh, thanks about the reporting thing, I couldn't for the life of me figure out how to do it...
chronidu
Aug. 16th, 2010 01:28 am (UTC)
Price your commissions factoring in the paypal fees in the first place. That's about all there is too it I've found.
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