Ok so here is an update.

The buyer got back to me today to say that they went back to the post office today with the tracking number and the post office said that they don't have the package. I just find it bizarre because the package obviously arrived at that post office.It is a small country town of around 1600 people.

So, do I await Paypal contacting me with a dispute and then give them a copy of the receipt? Will this mean that the buyer can leave me neg feedback even though I have proof that I have posted the package and it arrived at their post office?

Thanks for all the help