How to get payments is always a concern for freelancers. This is where platforms like PayPal make things easier. Here is a detailed guide on using PayPal for freelance work.
With the number of freelance platforms and freelancers increasing, the need for secure payment methods has also soared. Fortunately, online payment platforms and services have kept up with these requirements.
While most people use PayPal for freelance work, the online community is also exploring other payment options. PayPal has grown immensely since its foundation in 1998, emerging as one of the most popular payment methods today.
In this guide, I’ll discuss how PayPal compares with other payment methods and why you need a PayPal freelancer account nowadays.
Basically, freelancer payment works like this: You complete a gig, and you get paid. So, there’s no need to wait until the end of the month. Therefore, bank transfer—especially international—is not always a feasible method.
Whether you’re an employer searching for the best ways to pay freelancers or a freelancer looking for the best ways to get paid, here are some options to consider.
PayPal supports the international freelancing market in true essence, considering it has 227 million active users who can make transactions in 25 currencies. Besides individuals, many companies are also using PayPal.
So, paying becomes a breeze if you bag a handsomely-paying client who has PayPal. Part of the reason why using PayPal for freelance work has become so common is the ease of use provided by the platform.
One, it allows you to pay using your credit card. Two, you can make bank account payments. Three, the mobile app makes it extremely simple and quick for anyone to make payments on the go. Four, it’s quite secure and trusted all over the world.
PayPal is a remarkable option for freelancers to get paid and a simple way for clients to pay. As an employer, you can use the mass electronic payment features on PayPal to pay all freelancers working for you with a single click.
Here are some other notable features of PayPal:
Payoneer is another payment method that allows mass electronic transactions, letting you pay up to 200 beneficiaries at once. Like PayPal, it also has a cross-border payment option, covering up to 150 currencies and 200 countries.
Here are some other features of Payoneer:
See Related: Awesome Freelance Business Cards
If you don’t have a PayPal freelancer account yet, you can use Venmo to send and receive money. Although fairly useful, the platform is not as professional as PayPal or Payoneer.
However, it’s an online wallet that enables you to send money through major debit cards, Venmo balance, and US bank accounts. An apparent downside of Venmo is its exclusive availability in the US.
Here are some notable features of Venmo:
If you want to know how to receive payments for freelance work on your doorstep, you might want to check out Xoom. The money transfer service is operational in 32 countries and allows you to send money in several currencies.
It’s much simpler than some other payment methods as employers merely have to transfer money from their bank accounts into a freelancer’s account. As a freelancer, you can choose to pick up your money from particular locations, like Western Union.
Here are some other features of Xoom.
Since there are a ton of other payment options, I can go on and on about the services you can use. However, this guide’s focus is on highlighting the potential of PayPal as the primary payment service for freelancers. So, let’s get deeper into it.
In the past few years, PayPal has become synonymous with online payments, with phrases like ‘PayPal it to me’ and ‘PayPal me a $50’ becoming common. That’s because PayPal introduced people to a number of interesting features that played a huge role in driving the e-commerce and freelancing markets.
Here are some of the benefits of using PayPal for freelance work.
One of the major reasons for most online workers having a PayPal freelancer account is safe transactions. PayPal promises protection for your purchases and account on the whole.
If you’re shopping for anything online, you feel safe, considering there’s no need to give your financial information to any random website on the Internet. Instead, you can simply use your PayPal account.
PayPal also offers protection after a transaction – a rare feature in online payment transfer services.
If your payment details don’t match the description or are a no-show, PayPal will help you get a refund.
Covering 203 global markets, PayPal is one of the largest payment networks in the world. Since the freelancing industry has grown substantially around the globe, this feature comes in handy for international payments.
Furthermore, there’s no need for currency conversion as PayPal supports the most common currencies.
Apart from one-time payments, the platform also offers fast transactions for recurring payments for long-term, contract-based freelance work.
It’s 2021, and you can finally let go of the hassle of carrying a wallet around everywhere.
PayPal lets you pay freelancers without writing your account number for every single transaction. All you have to do is type your password, and you’re good to go.
To make the transactions even faster, you can activate One Touch in PayPal. It lets you stay logged in on PayPal on your chosen devices.
Another benefit of using PayPal for freelance work is that it integrates with Xero. Xero is accounting software that helps you make business budgets. Furthermore, you can use it to create invoices and send them to your clients via email.
So, integrating Xero with your PayPal freelancer account saves you a ton of hassle.
The invoices you send out will have a payment button in them. When you choose your default payment option to be PayPal, the client can pay you quickly by clicking on the button in the invoice.
Even better, Xero displays the payment in your account immediately while marking the invoice as paid. Plus, it also shows you the transaction fee and lists it under Bank Charges. Therefore, with Payal integration, Xero makes accounting a piece of cake for you.
When learning about how freelancer payment works, taxes often come up. Freelancers also have to pay taxes despite not being affiliated with any company.
Fortunately, PayPal lets you pay your federal income taxes. You can pay them through USAtax.com to the IRS if your total payments exceed $99. Here are some tools to calculate your tax for the season:
When you pay your taxes through PayPal, the IRS receives the payment right away. Make sure to pay on time since most freelance platforms will probably block your account if you’re running late on tax payments.
PayPal has been rolling out banking services in the past few years. Now, it offers a ton of services, including credit cards, debit cards, and ATM.
The PayPal ATM is called PayPal Cash Card. You can use it at any MoneyPassATM without any withdrawal charges. Plus, it can be used to withdraw funds from your main account. Likewise, the debit card lets you withdraw funds too.
PayPal Here is the mobile app you can use to access your PayPal account. It’s available for Android and iOS, catering to freelancers using all sorts of devices.
Since the app is free, you can download it today and start receiving or sending payments online today.
Thanks to the phone app, clients can still pay you if they’re away from their desktops or on vacation in a remote corner of the world.
PayPal emphasizes being freelancer-friendly as the platform allows online workers to get paid in most countries around the world. Moreover, many popular freelancing platforms, such as Fiverr, Freelancer, Upwork, and 99designs, support PayPal payments.
PayPal claims that its service is freelancer-friendly since it’s trusted by clients. If you accept PayPal payments, your clients will have ultimate peace of mind, being familiar with the platform’s safe transactions.
In fact, the 2018 Online Payment Experiences Study showed that 44% of the customers have a higher likelihood of trusting a business if it accepts PayPal.
Furthermore, since PayPal gives your clients multiple methods to pay, you’ll get paid on time. Your clients can select the card they prefer and send the payment right into your account.
At the moment, PayPal is being used in more than 200 markets globally. So, it gives you the liberty to expand your reach and get clients from other continents too.
If you have a PayPal freelancer account, you can get paid in three ways.
PayPal offers two types of accounts that are equipped to meet your needs.
You can use the personal freelancer PayPal account type if you’re a beginner or intermediate freelancer who only needs to accept payments or shop online.
The business freelancer PayPal account type is suitable for you if you run a small freelancing agency or team. In a PayPal business account, you can:
When choosing a payment method that makes more sense for your freelancing needs and frequency of funds transfer, you need to compare different platforms. Here’s a table showing how PayPal compares with some other payment methods.
| Features | PayPal | TransferWire | Payoneer |
| Mass Payments | Yes | Yes | |
| Routes of Currency Conversion | 26 | Over 300 | Over 100 |
| Payment Speed | 3 to 5 days | 1 to 4 days | 2 hours |
| ACH Cost | $0.25 per transfer | $0.35% (US only) | $3.00 per transfer |
| Credit Card | $0.25 per transfer | $1.2% | $3.00 per transfer |
| Debit Card | $0.25 per transfer | $3.6% | $3.00 per transfer |
As evident, using PayPal for freelance work is a budget-friendly choice since the PayPal freelancer fees are much lower as compared to some other platforms.
Besides benefiting from low PayPal freelancer fees, you can also use your account for online shopping, making bookings, and paying taxes.
If you ever had any confusion about how to pay freelancers, they must be clear now. Using PayPal for freelance work is not just pocket-friendly but also a quick and safe way to receive payments from any corner of the world.
Now, you can set up PayPal for freelancers, personal or business, and benefit from the platform’s many features.
Last updated: July 5, 2024
