To offer PayPal as a payment option during checkout, you must first enable PayPal Instant Payment Notification (IPN) in your PayPal account. We also recommend enabling PayPal's Auto Return.
1) Click 'Payment Options' under the 'Commerce' heading of the Control Panel.
2) Under the 'PayPal Settings' heading, edit your PayPal settings.
3) When you are finished, scroll down & click the 'Save' button.