Stripe vs Paddle vs LemonSqueezy: which is right for SaaS?
Stripe vs Paddle vs LemonSqueezy comes down to who handles sales tax. Stripe usually has lower fees and more control, but tax compliance generally stays with you. Paddle and Lemon Squeezy charge 5% + 50¢ per transaction and act as merchant of record, so they handle much of the tax work. Lemon Squeezy now points customers towards Stripe Managed Payments, so check its status.
Reviewed by Anubhav Gupta, Bespoke Devs · Updated
Stripe vs Paddle vs LemonSqueezy, side by side
| Compare | Stripe | Paddle | Lemon Squeezy |
|---|---|---|---|
| Main fee | Card fees vary by country | 5% + 50¢ per transaction | 5% + 50¢ per transaction |
| Subscription billing | Stripe Billing: 0.7% of billing volume | Included | Included |
| Merchant of record | Check Stripe Managed Payments | Yes | Yes |
| Sales tax and VAT | Tax tools available, compliance usually yours | Handled by Paddle | Handled by Lemon Squeezy |
| Extra fees | Some, depending on setup | Bespoke pricing may apply under $10 | May apply outside the US and in edge cases |
| Control over checkout | High | Less | Less |
Prices and terms change often, so confirm on each company’s site.
Which one fits you
Choose Stripe if
- You want the most control and flexibility
- Your revenue is high enough for lower fees to matter
- You have an accountant to handle tax
- You need a custom billing setup
Choose a merchant of record if
- You sell to many countries from day one
- You don’t want to register and file for sales tax
- You’d pay a higher fee to save that work
- You’re a small team without finance help
What a merchant of record means
A merchant of record is the company legally selling to your customer. It collects and pays the sales tax, and you receive the money after its fee. With Stripe, you’re generally the seller, so tax registration and filing usually stay with you, even when software calculates the amounts.
On a $20 monthly plan, a fee of 5% + 50¢ is $1.50, or 7.5% of the sale. On a $100 plan, it’s $5.50, or 5.5%. So low-priced plans feel this kind of fee the most.
How to compare the fees on your own plan
Stripe vs Paddle fees are hard to compare from headline rates, because Stripe’s card fee varies by country and Stripe Billing adds 0.7% of billing volume. On a $20 plan, that Billing charge is 14¢, and your card fee comes on top. Paddle’s total on the same sale is the $1.50 worked out above. Look up the card fee for your country, add it to the 14¢, and you have the real gap.
Then scale it up. With 100 customers on that $20 plan, a 5% + 50¢ fee is $150 out of $2,000 a month. Set the monthly gap against what tax registration and filing would cost you. That turns Stripe vs Paddle vs LemonSqueezy into a sum you can check, using your own prices.
The Stripe vs Paddle for SaaS question also depends on where your customers are. If they’re mostly in one place, the tax work may be manageable with an accountant. If they’re spread across many countries, more of it may apply to you, so ask before you decide.
Common questions
Yes, but it takes work, especially moving active subscriptions and saved cards. Paddle says your data can be migrated, so check how each provider handles this.
Often yes while you’re small and selling internationally, because filing tax in many places is expensive. As revenue grows, the fee can become bigger than the cost of handling tax yourself.
Yes. A merchant of record handles the tax on those sales, but you still have your own company taxes. Get advice for your country.
Check first. Its pricing page mentions Stripe Managed Payments, and that could affect new accounts. Read its current terms, and confirm it still offers what you need before you build your billing around it.
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