Stripe Managed Payments vs Paddle: fees, tax and limits in 2026

Stripe Managed Payments and Paddle are both merchants of record. A merchant of record is the company that legally sells your software to your customer and takes on what comes with being the seller: the sales tax, VAT and GST on each sale, fraud, disputes and payment support. Stripe made Managed Payments generally available on 29 April 2026. Paddle has sold software on its customers' behalf for years. The two now compete for the same founders.

If you sell a SaaS to customers in several countries, the choice settles three things: what each sale costs you, where you still have to file taxes, and whose name your customer sees on the receipt. This comparison takes them in that order, then adds a third option: staying the seller yourself, with Stripe Tax.

The short answer

Pick Managed Payments if you already run on Stripe Checkout and Billing, sell a fully automated digital product and mostly charge European cards. Turning it on keeps your stack, and on European cards it costs about the same as Paddle.

Pick Paddle if you sell to businesses on invoice, need a checkout built into your own pages, or charge many customers outside Europe, where Stripe's fees stack up. Paddle quotes one rate for all of it.

Managed Payments and Paddle, side by side

• Price. Managed Payments: 3.5% per successful transaction, on top of Stripe's processing fees, plus 0.7% of billing volume for subscriptions. Paddle: 5% + 50¢ per checkout transaction, subscriptions included.
• What the price covers. Both include tax handling, fraud prevention and dispute handling. Managed Payments adds transaction-level customer support through Link; Paddle handles billing support for your customers.
• Tax coverage. Managed Payments handles sales tax, VAT and GST in more than 80 countries, and leaves sales elsewhere to you. Paddle says it calculates, collects and remits tax across the world, in 200 markets.
• What you can sell. Managed Payments takes fully automated digital products only: software, games, digital media, online courses, hosting. It excludes professional services such as consulting, design and development. Paddle is built for SaaS, mobile app, AI and digital product companies.
• Checkout and integration. Managed Payments runs on Stripe Checkout and Payment Links only, without custom Elements flows, Connect, one-off invoices or a custom domain on the checkout. Paddle has its own checkout, as an overlay or inline in your page, and supports sales-assisted invoices and one-time charges.
• What your customer sees. With Managed Payments the customer buys from Link: receipts and invoices come from Link, and the card statement reads LINK.COM* followed by your descriptor. With Paddle, your name appears on the statement alongside Paddle's.
• Payment methods. Managed Payments: cards, Apple Pay, Google Pay and Link everywhere, plus local methods in some markets, such as Pix in Brazil, UPI in India and Bancontact in Belgium. Paddle: cards, Apple Pay, Google Pay, PayPal and local methods.

What a €49 subscription costs on each

Take a €49 monthly plan, paid with a standard European card. On Managed Payments you pay Stripe's processing (1.5% + €0.25), the Managed Payments fee (3.5%) and Billing (0.7%): 5.7% + €0.25, or €3.04 a month. Stripe charges its 3.5% on the full amount, VAT included. On Paddle the same charge costs 5% + 50¢: €2.45 plus the fixed 50 cents.

The gap opens outside Europe. Stripe's processing fee for international cards is 3.15% + €0.25, so a non-European card on a Managed Payments subscription costs 7.35% + €0.25. Managed Payments turns on Adaptive Pricing by default, which charges customers in their own currency, and Stripe then charges you no conversion fee. Paddle's 5% + 50¢ doesn't change with the card. For a one-time purchase, Managed Payments drops the 0.7% Billing fee and comes out at 5% + €0.25 on European cards, just under Paddle.

Each dispute you receive adds Stripe's €20 fee. When Stripe fights a dispute for you, it pays the evidence fee itself.

Where Managed Payments wins

• You're already on Stripe. Stripe documents how to turn Managed Payments on in an existing Checkout integration, and your products, prices and reports stay in the same dashboard.
• Most of your customers pay with European cards. At 5.7% + €0.25 on a subscription and 5% + €0.25 on a one-time sale, the price sits next to Paddle's, with Stripe's checkout and Link's saved cards on top.
• You want disputes off your plate. Stripe reviews each dispute and, when it counters one, submits the evidence and covers the evidence fee.
• You're on Lemon Squeezy. Stripe bought Lemon Squeezy in 2024, and in January 2026 its team wrote that the goal is an easy way for Lemon Squeezy users to move to Managed Payments.

Where Paddle wins

• You sell to businesses on invoice. Managed Payments can't issue one-off invoices or create a subscription outside Checkout and Payment Links. A deal your sales team closes, paid against an invoice, fits Paddle's sales-assisted invoices, or no merchant of record at all.
• Your checkout is part of the product. Managed Payments works only through Stripe Checkout and Payment Links, without custom Elements flows or a custom domain. Paddle's inline checkout embeds its payment form in your own page, and you build the rest of the layout around it.
• Many of your customers are outside Europe. On a non-European card a Managed Payments subscription costs 7.35% + €0.25. Paddle stays at 5% + 50¢.
• You sell where Stripe leaves the tax to you. Managed Payments handles tax in more than 80 countries and leaves the rest to you, while Paddle says it covers sales tax worldwide. Managed Payments also can't sell to customers in a short list of countries, including China and Russia.
• You want your name on the receipt. With Managed Payments, receipts, invoices and renewal reminders come from Link, and customers manage their orders on link.com. Paddle puts your name on the statement next to its own.
• Your customers pay with PayPal. Paddle accepts it. Managed Payments doesn't list it among its payment methods.

The third option: stay the seller

A merchant of record charges for taking on the seller's liabilities. If your sales are concentrated, you can keep those liabilities and pay less per sale: Stripe Billing for subscriptions, Stripe Tax to calculate and collect, and a registration wherever the law asks for one.

In the EU the threshold is concrete. A business established in the EU charges its customers' local VAT once its cross-border sales of electronic services to consumers pass €10,000 a year. It can declare that VAT through the One Stop Shop instead of registering in each country. On sales to businesses in other EU countries you usually don't charge VAT: the customer accounts for it. A B2B SaaS selling mostly inside Europe may find a merchant of record handles little it couldn't handle itself. Have your accountant confirm where you're registered before you switch either way.

The cost is the work. You register, you file, and you answer the disputes and the payment questions yourself. The more countries you sell to consumers in, the more that work weighs against a merchant of record's fee.

How we decide for a SaaS

Three questions settle it:

1. Who buys? Consumers in many countries point to a merchant of record. Businesses with VAT numbers, mostly in Europe, point to staying the seller.
2. How do they buy? A self-serve checkout fits either merchant of record. Invoices and sales-led contracts rule out Managed Payments today.
3. Where do they pay from? Mostly European cards keep Managed Payments level with Paddle. A large share of cards from outside Europe favours Paddle's single rate.

Whichever you pick, the integration work around it stays the same: webhooks that keep access in sync, a customer portal, and a clean path for upgrades and refunds. The Stripe side is in our guide to Stripe Checkout and the Customer Portal. Mobile subscriptions are in RevenueCat vs Stripe Billing, and the budget in Stripe integration cost and timeline.

Sources

• Stripe Docs: Managed Payments
• Stripe Docs: Managed Payments eligibility
• Stripe Docs: How Managed Payments works
• Stripe Support: Managed Payments pricing
• Stripe: Pricing (Ireland)
• Stripe on X: Managed Payments is generally available
• Paddle: Pricing
• Paddle Developer: How Paddle works
• Paddle Developer: Inline checkout
• European Commission: One Stop Shop
• Your Europe: Cross-border VAT
• Lemon Squeezy: 2026 update