Asked

Paddle or Stripe?

I've used Stripe on other projects, but it's kind of a hassle to deal with taxes and VAT yourself. I was thinking to use Paddle for RSSMailer.

Anyone has any opinions on Paddle or other suggestions?

I haven't used Paddle myself, but I like about Stripe is how well popular it is. This means it has a large eco-system of third-party products (analytics, dunning, etc) and code tutorials. This one is quite good: https://courses.gorails.com/payments-with-stripe-and-rails-master-class

Did you try find auto VAT MOSS for Stripe?

Before started to change payment processor maybe could be a good idea to try to fix current problem without switching from Stripe?

Just to let you know that there are services that handle VAT MOSS for Stripe automatically, for example: Quaderno $49/mo (I didn't try it).

Paddle and Gumroad

Also you can try Paddle or Gumroard.

Paddle and Gumroard, the are both handle VAT MOSS automatically and you can choose rather you will pay (include in the price) or a customer (added as extra to price).

How they are working?

Gumroad and Paddle serving all your clients and you have just 1 client - Gumroard or Paddle that are sending you money:

Client 1
             \
Client 2  --- Gumroad (Paddle) --- You
             /
Client N

Fees:

Gumroad:

  • Fee is 3.5% + $0.3
  • Can be withdraw only to PayPal (if you are outside US)
  • Withdraw once a Week.
  • Min withdraw is $10

Paddle:

  • Fee is 5% + $0.5
  • Can be withdraw only to Bank, Payoneer, PayPal
  • Withdraw once a Month.
  • Min withdraw is $100
  • Tip: Paddle will charge 10% extra if they first payment wasn’t completed but they converted users with their auto email follow-ups. It’s called “Checkout recovery” — user opened email, clicked on the link and made a payment. But seems like you can turn it off

Other

  • Both accept payments from PayPal (your users can pay with PayPal). Stripe is not support it.
  • Both have recurrent payments
  • Both have API
  • Seems like Gumroad is more fore Digital products (like apps, membership) and Paddle is more for SaaS. But it's not limiting you to use it opposite.

So what should you choose?

I would suggest to do the math and calculate how much it will total cost you for all 3 solutions:

  1. Stripe with auto VATT MOSS service
  2. Paddle
  3. Gumroad

You can play around with different amount of transactions and prices.

Here is calculator spreadsheet for you: Make a copy

So you can make a decision consciously based on data.

Keep us updated which solution you will choose. I think a lot of people here have the same problem.

Good luck!

This was super helpful btw. In the end I picked Paddle.

If you don't want to handle tax, then go with Paddle although it will cost a bit more than Stripe.

It sells under the brand "Paddle" so you don't have to register your own company.

With Stripe, you need to handle tax yourself. But you'll save some money :)

I also got this response on Twitter: https://twitter.com/rienswagerman/status/1176539337514770434

Seems that you can also let Stripe do VAT.

I try to implement Paddle for my product and found the documentation quality pretty bad compared to Stripe ... They also seem to focus more on software licence and not really on SaaS but I might be wrong.

Btw does anyone know how wip.chat handles VAT? I don't see any VAT mentioned in the bill.

Since we're based in Singapore, we don't need to charge you any VAT hence it not being on the receipt.

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