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GoodVat

SaaS Payments: Merchant of Record vs Stripe + GoodVat

Short answer: a Merchant of Record (MoR) is the simplest way to start selling SaaS, but once you count the surcharges it costs 6–8% of revenue. Stripe + GoodVat costs about 4–5% of revenue plus $100 a month, and GoodVat handles the sales tax and VAT the MoR used to deal with. Below about $100,000 a year the two cost about the same. Above that, switching saves more every year.

How the two setups differ

Section titled “How the two setups differ”
Merchant of RecordStripe + GoodVat
Who the customer buys fromThe MoR (Paddle, Lemon Squeezy, Polar, Stripe Managed Payments)Your company
Name on the card statementThe MoR’sYours
Who’s registered for taxThe MoRYour company. GoodVat registers you and files your returns
All-in cost6–8% of revenue4–5% of revenue + $100/month
When you get paidOn the MoR’s payout scheduleStripe’s rolling payouts, every few days
CheckoutThe MoR’s checkoutAny checkout you build on Stripe

What a Merchant of Record really costs

Section titled “What a Merchant of Record really costs”

Every MoR advertises a headline rate, then adds surcharges for non-US cards and subscriptions. Here’s a subscription business doing $1M a year, with a $50 average charge and 40% of revenue on non-US cards:

What you pay each year$1,000,000 revenue$50 average charge40% non-US cards
  1. Stripe Managed Payments2.9% + 30¢, +3.5% MoR fee, +1.5% non-US, +0.7% Billing
    $83,000
  2. Lemon Squeezy5% + 50¢, +1.5% non-US, +0.5% subscriptions
    $71,000
  3. Polar5% + 50¢, +1.5% non-US
    $66,000
  4. Paddle5% + 50¢
    $60,000
  5. Stripe + GoodVat2.9% + 30¢, +1.5% non-US, +0.7% Billing, + GoodVat $100/mo
    $49,200

Stripe + GoodVat costs $10,800 to $33,800 less a year than a Merchant of Record.That’s $48,000 to Stripe and $1,200 to GoodVat.

Published list prices, checked October 2026. All payments are subscriptions charged in USD. GoodVat is the Growth plan; tax registrations and filings are quoted per country.

Strip out the card processing and the rest is what you pay for tax handling. Stripe on its own costs $48,000 here. Paddle charges $12,000 on top of that, Lemon Squeezy $23,000, and Stripe Managed Payments $35,000. GoodVat costs $1,200.

The chart leaves out some fees that make MoRs more expensive still:

  • Lemon Squeezy: 1% on payouts to non-US banks, 1.5% on PayPal payments, 5% on recovered abandoned carts, 3% on affiliate sales (fees).
  • Polar: $15 per dispute, plus Stripe’s payout fees of $2 a month and 0.25% + 25¢ per payout. Paid plans from $20 a month lower the base rate, down to 3.4% + 30¢ on the $400-a-month Scale plan (fees).
  • Stripe Managed Payments: the 3.5% comes on top of standard Stripe processing, and Billing is charged separately (pricing).

Cost at different revenue levels

Section titled “Cost at different revenue levels”

The MoR fee is a percentage, so it grows with every dollar you make. GoodVat is a flat plan.

Yearly revenueMerchant of RecordStripe + GoodVatYou keep
$100,000$6,000–$8,300$6,000up to $2,300
$250,000$15,000–$20,750$13,200$1,800–$7,550
$500,000$30,000–$41,500$25,200$4,800–$16,300
$1,000,000$60,000–$83,000$49,200$10,800–$33,800
$2,000,000$120,000–$166,000$97,200$22,800–$68,800

Merchant of Record range covers Paddle, Polar, Lemon Squeezy, Stripe Managed Payments. $50 average subscription charge, 40% on non-US cards. List prices checked October 2026.

What you take on when you leave an MoR

Section titled “What you take on when you leave an MoR”

Once you’re the seller, the tax registrations are yours. For a SaaS company selling to consumers, that usually means:

  • EU: if your business is outside the EU, you charge VAT from your first sale to an EU consumer and file one quarterly return through the non-Union One Stop Shop. EU-based businesses have a €10,000 threshold for sales to other EU countries.
  • UK: overseas sellers of digital services charge UK VAT from the first sale to a UK consumer.
  • US: you register in a state once your sales there pass its threshold, usually $100,000 a year. About 20 states tax SaaS.
  • Elsewhere: Australia, Canada, Japan and many other countries require foreign digital sellers to register.

Sales to businesses are simpler. A customer with a valid EU or UK VAT number is usually reverse-charged, so you don’t charge them VAT.

How GoodVat handles it

Section titled “How GoodVat handles it”
  • Tracks where you owe tax, against every US state’s threshold and every country’s rules for digital services, and warns you before you cross one.
  • Registers you wherever you need to be, before you switch.
  • Calculates tax on every Stripe charge, including reverse charge for businesses.
  • Files your returns and sends your customers compliant invoices.

You connect Stripe once, and we take care of the rest.

When an MoR is the better choice

Section titled “When an MoR is the better choice”
  • You make less than about $100,000 a year. The saving is too small to be worth a switch. Focus on the product.
  • You don’t want your company registered for tax anywhere. With an MoR, the MoR holds the registrations.
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