How to Calculate the Exact Invoice Amount After Stripe and PayPal Fees (Reverse Fee Formula)
You quote a client $1,000. They pay. Your bank shows $970.70.
That missing $29.30 isn't a mistake. It's the payment processor's cut, and if you didn't build it into your invoice, you paid it out of your own pocket. Most freelancers handle this by adding the fee percentage on top of the price, but that method quietly leaves you short every time.
Here's why, and how to get the number right.
Why the "just add 2.9%" method fails
Stripe's standard US card rate is 2.9% + $0.30. Say you want to receive exactly $1,000, so you invoice $1,029 (adding 2.9%).
Stripe takes its percentage from the total amount charged, not from your target. So it deducts 2.9% of $1,029 (about $29.84), plus $0.30. You receive $998.86, which is $1.14 short.
That's small on one invoice. But across dozens of invoices a year, it adds up to real money you never saw coming.
The reverse fee formula
To receive an exact net amount, you work backwards:
Invoice = (Desired Net + Fixed Fee) ÷ (1 − Percentage Fee)
Where the percentage fee is written as a decimal (2.9% = 0.029).
For a $1,000 target with Stripe US rates:
(1,000 + 0.30) ÷ (1 − 0.029) = 1,000.30 ÷ 0.971 = $1,030.18
Check it: 2.9% of $1,030.18 is $29.88, plus $0.30 gives $30.18 in fees. $1,030.18 − $30.18 = $1,000.00. Exact.
Step by step
Decide the net amount you want to land in your bank.
Find your processor's rate: the percentage and the fixed fee.
Add the fixed fee to your net amount.
Divide by (1 − percentage).
Round up to the nearest cent and put that on the invoice.
If you'd rather skip the arithmetic, this free reverse invoice calculator for Stripe and PayPal does all five steps for US, UK and EU rates. Enter your target and it tells you what to bill.
Same $1,000 target, different processors
Using the formula, here is what you'd need to invoice to net exactly $1,000:
Scenario Rate Invoice needed
Stripe US domestic card 2.9% + $0.30 $1,030.18
PayPal US commercial 3.49% + $0.49 $1,036.67
Stripe, international card 4.4% + $0.30 $1,046.34
Stripe, international + currency conversion 5.4% + $0.30 $1,057.40
Stripe UK domestic card 1.5% + £0.20 £1,015.43
The international rows show why cross-border clients are the expensive ones. The extra 1.5% for international cards and 1% for currency conversion get added to the percentage, which pushes the invoice up faster than most people expect.
Rates change and differ by account type, so always confirm your current pricing on Stripe's or PayPal's own pricing page before you rely on these figures.
Should you pass fees on to the client?
That depends on your market and contract:
Build it into your price. Many freelancers simply quote a rate that already covers processing costs. This is the cleanest approach and avoids awkward surcharge conversations.
Add a line item. Showing a "payment processing" line is transparent, but in some regions and card networks, surcharging rules apply. Check the rules where you and your client are located.
Offer a cheaper payment method. Bank transfer or ACH typically costs far less than cards, so you can offer it as the default and keep cards as an option.
Common mistakes to avoid
Forgetting the fixed fee. On small invoices, the $0.30 matters more than the percentage.
Ignoring international and currency fees. One overseas client can cost you several times more than a domestic one.
Mixing up Stripe and PayPal rates. PayPal's commercial rate is higher, so the same target needs a bigger invoice.
Calculating fees on your target instead of the invoice total. This is the "add 2.9%" trap above.
The short version
If you take one thing from this article: the processor charges its percentage on the amount your client pays, not the amount you want. So divide, don't multiply.
For quick checks while you're invoicing, you can use the Stripe and PayPal fee calculator at FeeCheckTools, which handles domestic, international and currency conversion cases in USD, EUR and GBP. If you also want to see where your pricing sits overall, the same site has a freelance hourly rate calculator and a 1099 vs W-2 comparison tool.
This article is for general information, not tax or financial advice. Check current fee schedules with your payment provider.
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