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How are fees for Payouts calculated and reported?

As of May 15, 2018, PayPal will calculate the fee individually for any Payout that you send. (Previously, Payouts calculated fees at the batch level.)
Beginning with the May reports for your account, both the Transaction Report and the Settlement Report will list fees explicitly and individually.
  • For each payout transaction, the report will list the fee in the Fee Amount column of the actual transaction (code T0001), instead of as a separate line item (code T0104 or T0107).
  • PayPal will still place a single hold for the entire payout batch amount (code T1503).
  • PayPal will use a separate line item to reverse the hold amount for each payout in the batch (code T1105) as it's completed. Previously, code T1105 indicated a single reversal of the entire hold amount. 

The following images compare the old report format and the new format with individualized fee information.

Old vs. new report layout
Other Payouts enhancements
Fee-related changes are among several updates PayPal has made to the Payouts REST API to enhance your Payouts experience and speed payment delivery to your recipients. Here are some highlights:

Payouts experience
  • We now guarantee processing of valid requests within 24 hours.
  • You can get real-time processing updates using webhooks and status API on a more granular level, compared to older IPN notifications.
  • When you send a Payout, you can also add a customized message to all your recipients.
  • We’ve added pagination to make it easier to handle REST API results.
  • You can manage your Payouts effectively through actionable status and error scenarios.
  • The Payouts REST API now supports up to 25,000 payments per API call.
  • You can send payments to as many as 15,000 recipients per file with our upgraded web upload experience.
  • You can send unlimited payments per file through our large file processing product.
Note: To support these changes, PayPal recommends that you make any required adjustments on your end before May 15, 2018. If you have any questions regarding the upgrades, reach out to your account manager or our Customer Service team.

See also:
Payouts API Overview
What is the Payouts API and how do I enable it on my account?
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