Question about Paypal Business Accounts

[D_Flello]

I am a small business owner who wants to use Paypal to start invoicing clients and taking orders through e-commerce platforms.

I've had a Paypal account for a very long time, and I've already been using it to send and receive payments for various aspects of the business. Now, I'll be dealing with the general public rather than private clients, so withholding all of my personal information such as my home address and phone number and providing a company name instead is a very attractive feature.

I am a little confused about what upgrading to a business account entails, however.

Does it effect my ability to make personal transactions or to send money to friends and family in any way, as a business account with a bank would? For example, if I upgrade from a personal account to a business account, can I still send birthday gifts or buy Steam games, or can that account then only be used for business related expenses?

I understand that the Business Pro account has a $30 monthly maintenance fee. I don't need the Pro account, but does the regular business account have any fees or extra costs I should know about?

Do I have to provide any extra information to Paypal to qualify for a business account? I already have verified bank accounts linked to the personal account, and I have a European VAT number that I can provide for tax purposes, but is there anything else I should know about?

Thank you.

[sharpiemarker · Accepted solution]

@D_Flello 

“I am a little confused about what upgrading to a business account entails, however. Does it effect my ability to make personal transactions or to send money to friends and family in any way, as a business account with a bank would? For example, if I upgrade from a personal account to a business account, can I still send birthday gifts or buy Steam games, or can that account then only be used for business related expenses?”

Not at the moment.

In the USA only (coming July 28, 2022), PayPal is starting to disallow personal accounts from sending personal payments to business accounts and business accounts can no longer receive personal payments from personal accounts.

So who knows, PayPal one day might do this for the EU, so maybe consider keeping a personal account around for doing personal transactions that you do not mind revealing your info. And a open business account to have business info to interact with the public. Each PayPal user can have 1 personal and 1 business account.

To open separate business account in France:

https://www.paypal.com/fr/webapps/mpp/account-selection

“I understand that the Business Pro account has a $30 monthly maintenance fee. I don't need the Pro account, but does the regular business account have any fees or extra costs I should know about?”

There’s no monthly fee if you are using standard PayPal Checkout integration, PayPal buttons, invoicing. If you want advanced services and fully customizable PayPal Checkout integration, there is monthly fee.

See merchant fee chart.

“Do I have to provide any extra information to Paypal to qualify for a business account? I already have verified bank accounts linked to the personal account, and I have a European VAT number that I can provide for tax purposes, but is there anything else I should know about?”

You can open a business account as “individual” if you’re not a registered company or as a “sole proprietor” if you are registered as that, as well with partnership, corporation, ltd, non-profit, etc. There will be fields to enter tax ID numbers where applicable in Account Settings or as part of the sign-up process.

Here are the CIP documents PayPal may request:

https://www.paypal.com/fr/smarthelp/article/quels-documents-puis-je-télécharger-pour-confirmer-mon-i...

[D_Flello]

Thank you for the informative reply! It sounds like creating a new business account that's separate from my personal account to handle these transactions is the best solution.
I had one more question: do you know if there are any limitations on how business and personal accounts interact? For example, if I take payments on my business account and then transfer them to my personal account, would that be seen as an attempt to circumvent the system? Do there need to be bank accounts associated with the business account in order to withdraw the money, or can I just send that wherever it needs to go? 

[PayPal_RebeccaN]

Hi @D_Flello, 

Thank you for posting in the PayPal Community! Great question, I would recommend adding a bank account to your business account to withdraw your revenue from sales. 

Have a great day! 

Rebecca.