The best way to minimize PayPal fees when selling on eBay is to make sure you're using a consumer and not a business PayPal account. PayPal charges business accounts much higher rates for accepting payments. Another good way to maximize your profits is to allow payment by money orders as well as local pick up.
You may also want to first list your items for sale on Craigslist|Craigslist. Org to see if you can sell directly to sellers in your region.
As you're in the UK you could try Moneybookers as an alternative.
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