Hey founders! Building a SaaS and realized I have no idea how to handle sales tax/VAT for global customers 😰
Looking for a payment platform that can:
- Automatically calculate sales tax for different countries
- Handle VAT for EU customers
- File tax reports (or at least make it easy)
- Work with Stripe or as a full alternative
Basically I want to focus on building my product, not becoming a tax expert 😅
What do you guys use? Is it worth paying extra for tax handling?
Here’s what I learned after spending weeks on this:
Paddle is the winner for tax handling:
- They are a “Merchant of Record” – meaning THEY handle all the tax compliance
- Automatically charges correct VAT/sales tax for each country
- Files reports for you (in supported regions)
- Pricing: higher than Stripe (around 5% + 50c) but worth it for the peace of mind
Stripe has Tax (new product):
- Stripe Tax is extra ($0.50 per transaction for US, more for global)
- You still need to file reports yourself
- Good if you have a finance team
Lemon Squeezy – also handles tax:
- Similar to Paddle, acts as merchant of record
- Growing in popularity for indie hackers
My recommendation: If you are selling globally, just use Paddle or Lemon Squeezy from day 1. The tax headache is not worth saving 2%.