Stripe vs Paddle vs Lemon Squeezy fees for SaaS: merchant of record, explained (2026)

2.9% + 30¢ versus roughly 5% + 50¢ — on paper, Stripe is the cheap option and Paddle and Lemon Squeezy are the expensive ones. That comparison is honest but incomplete, and the missing piece is the entire reason the pricier two exist: Stripe leaves you to calculate, file and remit sales tax and VAT yourself, in every jurisdiction you sell into. Paddle and Lemon Squeezy do it for you, because legally, the customer is buying from *them*, not from you — they're the merchant of record on every transaction.

| Provider | Fee | Sales tax / VAT | Who is the legal seller |
|---|---|---|---|
| Stripe | 2.9% + 30¢ (US cards) | you calculate, file and remit (Stripe Tax is +0.5%) | you |
| Paddle | ~5% + 50¢ | Paddle collects and remits in 200+ jurisdictions | Paddle |
| Lemon Squeezy | ~5% + 50¢ | Lemon Squeezy collects and remits | Lemon Squeezy |

Run the numbers honestly and Stripe's advantage shrinks by a lot. International cards add roughly 1.5%, currency conversion another 1%, and Stripe Tax — which only calculates the tax, it doesn't file or remit it — another 0.5%. Add that up for a non-US founder actually selling internationally and Stripe lands closer to 5.9% all-in, against roughly 7.5% for Lemon Squeezy and 7–8% for Paddle. The real gap between "cheap" and "handles my taxes" is about 1.5 to 2 points, not the 2-point-versus-5-point gap the headline fees suggest.

What that premium buys, specifically, is tax filing — not a better checkout, not faster payouts, not fraud protection you couldn't get elsewhere. If sales tax and VAT compliance across dozens of jurisdictions would genuinely eat into your time or require hiring someone, 1.5–2 points is a reasonable price to make that problem someone else's.

Stripe still makes sense as the default if you already have finance capacity — your own or a bookkeeper's — and especially if you sell mostly domestically or B2B, where reverse-charge VAT often simplifies the picture anyway; it also has by far the deepest payments API of the three if you need to build something custom. Paddle is built for SaaS that's actually scaling globally to consumers and small businesses, with real subscription tooling and a dedicated failed-payment recovery product (Retain) that pays for itself once churn from declined cards becomes a real number. Lemon Squeezy — now owned by Stripe, still run as a separate merchant of record — is the fastest path to a first sale: quickest approval, simplest setup, the friendliest option for someone selling something for the first time in their life.

If handling tax compliance yourself sounds like a distraction from actually building the product, the merchant-of-record fee is worth paying — start on Lemon Squeezy and graduate to Paddle as volume grows. If you already have the finance support to handle it and sell mostly B2B, Stripe stays both cheaper and more flexible.