Is an active Paid Applications Contract required for testing In App Purchase?

For adding and testing InApp purchase in your application you have to agreed on apple contract for paid application and provide your contact info , bank info, and tax info. You have to login in itunesconnect.apple.com and click on contract, tax and banking.

After providing above info you can see Manage In App Purchase Button on itunes connect web site and you can add your product.

You need to create a Paid Applications contract in the Contracts, Tax, & Banking Information section of iTunes Connect. You will need a bunch of info about your bank, and it will take many days, possibly weeks, for them to hand process the request.