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Guide · PayPal · checked 24 Oct 2026

PayPal’s 180 days.

The 180 days in PayPal’s hold notices comes from its user agreement. The US and UK agreements use it differently, and UK ombudsman decisions show where holding longer has been found unfair, and where it has not.

The US agreement (PayPal, Inc.)

The US user agreement1 (last updated 14 September 2026) lets PayPal hold the balance in your account “for up to 180 days if reasonably needed to protect against the risk of liability or if you have violated our Acceptable Use Policy”. It adds that the hold “may remain in place longer than 180 days” under court orders, regulatory requirements or other legal processes.

… for up to 180 days if reasonably needed to protect against the risk of liability or if you have violated our Acceptable Use Policy.

— PayPal US User Agreement
  • Payment holds are shorter. Risk-based holds on individual payments “generally remain in place for up to 21 days” from when the payment was received, and may end earlier, for example once you upload shipment tracking.1
  • Disputed payments: if a payment is challenged, PayPal holds it until the matter is resolved, “but no longer than 180 days”.1
  • Reserves: on a business account PayPal may set a reserve at any time if it believes there may be a high level of risk.1

The UK agreement (PayPal UK Ltd)

The UK user agreement2 (last updated 12 October 2026) is between you and PayPal UK Ltd. After restricted activity PayPal may block your account and hold funds in the reserve account “including, without limitation, for more than 180 days if so required by PayPal, where PayPal’s rights arise from your engagement in the restricted activity”. There is no fixed outer limit in the text, which is why the ombudsman decisions below matter.2

What the UK ombudsman has decided

All three decisions concern PayPal’s earlier European entity, PayPal (Europe) S.à r.l. et Cie, S.C.A. Each turns on its own facts; read the full decision before you rely on it.

  1. Upheld · DRN-4862746

    No evidence, no claims: return it, with interest

    PayPal permanently limited Mr J’s account in February 2023, withheld around £4,150 and cited 180 days, then kept holding after day 180. The ombudsman found restricting, closing and withholding for 180 days fair, but continuing to hold unfair: PayPal gave no compelling evidence for it, had received no third-party claims, and Mr J showed his entitlement to funds from genuine business. PayPal was told to return the funds and pay 8% simple interest from the end of the 180 days until settlement, plus £300. Read DRN-48627463.

  2. Upheld · DRN1898614

    180 days was enough; about 225 was not

    The ombudsman found 180 days sufficient to protect against payment reversals where PayPal gave no reason to hold longer, and ordered 8% simple interest for the extra 45 days plus £150. Read DRN1898614.

  3. Not upheld · DRN-3055465

    A live reason can justify longer

    PayPal closed Mr G’s account on 15 February 2020, held the balance for 180 days, then kept it while it questioned his ID documents, releasing it on 20 December 2020. The ombudsman found PayPal’s concerns about the documents reasonable, so holding past 180 days was not unfair, and awarded nothing. Read DRN-3055465.

The pattern: the ombudsman asks whether PayPal had a reason, with evidence, to keep the money after day 180. Your job is to remove every reason you can, in writing, before you ask.3

What to do, by day

  • Day 0: keep the email that limited the account. Put the date into the hold calculator for day 180 and a calendar file.
  • Before day 180: answer every document request and send a factual evidence pack: refund and dispute rates, proof of delivery, invoices.
  • At day 180, UK: send a formal complaint that asks for release and cites the decisions above. The UK complaint letter does this. Then use the escalation timeline to track the 15-business-day deadline before the Financial Ombudsman.
  • At day 180, US: ask for release in writing, then follow the Notice of Dispute process with the US demand letter and its checklist.

Sources

Every source checked 24 Oct 2026. Numbers in the text link here.

  1. PayPal US User Agreement ↩
  2. PayPal UK User Agreement ↩
  3. FOS decisions DRN-4862746, DRN1898614, DRN-3055465 ↩

Questions, answered

Does PayPal have to release my money after 180 days?

Not automatically. The US agreement lets PayPal hold a balance for up to 180 days if reasonably needed to protect against liability, and longer where a court order, regulatory requirement or other legal process requires it. The UK agreement says PayPal may hold funds for more than 180 days where its rights arise from restricted activity. Day 180 is the point to ask for release in writing, not a guarantee.

Is a 21-day hold the same thing?

No. The US agreement describes risk-based holds on individual payments that generally last up to 21 days from when the payment was received, and can end earlier, for example once you upload shipment tracking. The 180-day period applies to holds on your balance after restricted activity, and to payments held while a dispute is resolved.

Can a UK seller complain to the Financial Ombudsman about PayPal?

Yes. PayPal UK Ltd’s agreement says it may take up to 15 business days to answer a payments-related complaint (8 weeks for others), and that you can refer the complaint to the Financial Ombudsman Service within 6 months of its response. Small businesses qualify; the ombudsman guide covers who counts.

What does a US seller do instead?

The US agreement requires a completed Notice of Dispute form, sent by certified mail to PayPal, Inc., Attn: Legal Specialists, Re: Notice of Dispute, P.O. Box 45950, Omaha, NE 68145-0950, and then 60 days of good-faith negotiation before arbitration or small claims. The US demand letter includes a checklist for it.