Part 1: Initial Setup in WHMCS
Begin by going to Setup > Payment Gateways in WHMCS.
Select PayPal from the Activate Gateway dropdown list and click Activate.
Enter your PayPal email address.
Review the settings for PayPal subscriptions, and enable or disable the options you desire. (For example you can remove the subscription button so customers can only make one time payments, or do the opposite and force customers to subscribe to reoccurring services and hide the one time payment button.)
The API settings are needed for automatic refunds.
Click Save Changes and copy the IPN URL.
Part 2: Setup in PayPal
Login to your PayPal account and navigate to Profile > Instant Payment Notification Settings.
Click Choose IPN Settings.
Paste the URL into the Notification field
Select Receive IPN Messages (Enabled).
Click Save.
Part 3: Return to WHMCS to Complete Setup
Return to WHMCS and navigate to Setup > Products/Services.
Click the Edit icon next to a product group.
Check the PayPal checkbox.
Finally click Save Changes.
Repeat the steps in Part 3 for all your product groups.
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