Stripe Managed Payments: Fees, Eligibility and How It Compares to Paddle

Short answer: Stripe Managed Payments is Stripe's merchant-of-record service. Stripe, through Link, becomes the seller for your digital product, and handles sales tax, VAT and GST in more than 80 countries, plus fraud, disputes and payment support. It costs 3.5% per transaction on top of standard Stripe fees, with Stripe Billing extra for subscriptions. For a $29/month US subscription that's about $2.36 per renewal, against $1.95 on Paddle. It's a good fit if you already run on Stripe Checkout and want to hand off tax. It's an expensive one if you're choosing a merchant of record from scratch.

Until recently, using Stripe meant being your own merchant of record: Stripe processed the card, and registering for and filing tax was your job. Founders who didn't want that went to Paddle or Lemon Squeezy. Managed Payments is Stripe's answer, and since Stripe bought Lemon Squeezy, it's also where Lemon Squeezy says its own merchant-of-record business is heading.

What Is Stripe Managed Payments?

Managed Payments is an option you turn on inside your existing Stripe account. For the transactions that use it, Stripe takes on the legal role of seller. Your customer sees the purchase as "Sold through Link", Stripe's checkout and wallet brand.

What Stripe handles:

Tax: calculates, collects, files and remits sales tax, VAT and GST in more than 80 countries. In countries outside that list you're still responsible, and Stripe Tax calculates those at no extra charge.
Fraud: Stripe sets the fraud rules and blocklists.
Disputes: Stripe reviews each dispute and submits evidence for you, or accepts it if it judges the dispute unlikely to win.
Payment support: customers contact Link support about charges, refunds and subscriptions.
Receipts and invoices: sent from Link, with PDFs attached.

What you still do: product support, your own income tax, and anything sold outside Managed Payments. You can still issue refunds and change subscriptions from the Dashboard or API.

How Much Does Stripe Managed Payments Cost?

Stripe charges 3.5% per successful Managed Payments transaction, on top of its standard processing fees. For a US business that means:

Fee	Rate
Card processing (US)	2.9% + $0.30
Managed Payments	+3.5%
Stripe Billing (subscriptions)	+0.7%
International cards	+1.5%
Currency conversion	Waived (Adaptive Pricing is always on)

So a US subscription costs about 7.1% + $0.30, and a one-time purchase about 6.4% + $0.30.

Three details that are easy to miss, from Stripe's pricing FAQ:

The 3.5% is charged on the full amount, including tax. On a customer paying 20% VAT, the fee applies to the VAT too.
Dispute fees still apply. Stripe charges the dispute-received fee, but covers the evidence submission fee when it fights the dispute for you.
Local payment methods have their own rates, such as Klarna, Cash App Afterpay and Pix, which can be higher than card fees.

Rates checked against Stripe pricing on November 4, 2026.

Stripe Managed Payments vs Paddle vs Lemon Squeezy

All three are merchants of record. Here's what each costs per payment, before tax, with no refunds or disputes.

Scenario	Managed Payments	Paddle	Lemon Squeezy	Stripe Billing + Tax (not an MoR)
$29/month, US card	$2.36	$1.95	$2.10	$1.49
$29/month, international card	$2.79	$1.95	$2.53	$1.92
$100/month, US card	$7.40	$5.50	$6.00	$4.40
$49 one-time, US card	$3.44	$2.95	$2.95	$1.97

Managed Payments subscriptions include Stripe Billing at 0.7%. Lemon Squeezy subscriptions include its 0.5% subscription surcharge. Stripe Billing + Tax is shown for comparison only: it's the cheapest, but you register for and file tax yourself.

On published prices, Managed Payments is the most expensive merchant of record in every scenario. The gap is about $0.40 per $29 renewal against Paddle, or about $2,500 a year at 500 subscribers.

What you get for that:

No migration. Your products, customers, Billing setup, webhooks and reporting all stay in Stripe.
You can mix. Turn it on per product or per market, and keep the rest on standard Stripe.
Link checkout. Customers with a saved Link account can pay in a couple of clicks.

	Managed Payments	Paddle	Lemon Squeezy
Subscription rate (US)	~7.1% + $0.30	5% + $0.50	5.5% + $0.50
International surcharge	+1.5%	None	+1.5%
Seller shown to customer	Link	Paddle	Lemon Squeezy
Checkout	Stripe Checkout or Payment Links	Paddle overlay or inline	Lemon Squeezy checkout
Use alongside standard Stripe	Yes, same account	No	No

For more detail, see Stripe vs Paddle, Lemon Squeezy vs Stripe and the Stripe vs Paddle vs Lemon Squeezy fee comparison. Cheaper merchants of record exist too, such as Creem and Dodo Payments; the payment fee comparison tool covers them.

Who Can Use It

Stripe reviews each account before granting access. From the eligibility page:

Your business must be based in: the US, Canada, the UK, most EU countries, Switzerland, Norway, Liechtenstein, Australia, Hong Kong, Japan or Singapore.

Your product must be fully automated and digital:

SaaS and software, including AI tools
Video games
Digital media: e-books, audiobooks, music, video, images
Online courses and self-study training
Web hosting and similar online services

Physical goods, consulting, design, development, tech support, live coaching and in-person events don't qualify. Each product needs an eligible Stripe tax code.

Your customers can be in more than 195 countries and territories. Restricted countries include China, Russia, Iran, Cuba, North Korea and Syria.

You also need a low dispute rate to stay eligible, and a direct Stripe integration. Connect platforms and Express accounts can't use it.

What Changes for Your Customers

Because Link is the seller, your customers will notice a few things:

Card statements show LINK.COM* [your descriptor].
Receipts, invoices and refund emails come from Link, not from you, and your Dashboard email settings don't apply to them.
Order management happens on link.com: order history, cancelling subscriptions and updating cards. You can still offer the Stripe Customer Portal on your own site.
Support: customers can contact Link about charges. If Link asks you for input and you don't reply within 48 hours, Stripe may refund the customer without your approval. It can issue refunds within 60 days of purchase in some cases.
Trial and renewal emails: Stripe always sends a trial start email, a reminder before trials longer than 7 days end, and anniversary renewal reminders.

For B2B customers who expect an invoice from your company, a Link-branded purchase can raise questions. Make sure your support email in the Stripe Dashboard is current, since Link uses it for escalations.

Limitations to Know Before You Switch

Existing subscriptions can't be moved onto it. Only new subscriptions bought through a Managed Payments Checkout Session qualify. Your current subscribers stay on standard Stripe, and you stay responsible for their tax.
Stripe Checkout or Payment Links only. No custom payment forms built with Elements, and subscriptions must be created through Checkout or Payment Links.
No custom domain on the checkout page.
No Connect, so no platforms or marketplaces.
No third-party tax integrations, and no adding invoice items or one-off invoices to a Managed Payments subscription.
Payment methods are chosen by Stripe. You can't set the payment method list on the Checkout Session.
Card updates go through the customer. You can't set a subscription's default payment method through the API; customers update it in the Customer Portal or on Link.

How to Turn It On

If you already use Stripe Checkout:

Check that your account and products are eligible.
Enable Managed Payments in the Stripe Dashboard settings.
Set an eligible tax code on each product you'll sell with it.
Use API version 2025-03-31.basil or later, and add managed_payments[enabled]=true when you create Checkout Sessions.
Remove the parameters Managed Payments controls, such as automatic_tax, payment_method_types and tax_id_collection.
Test in a sandbox, trying billing addresses in different countries to see the tax applied.

If you don't use Checkout yet, follow Stripe's setup guide, or start with Payment Links, which need no code.

What It Means for Your MRR Reporting

Managed Payments subscriptions are ordinary Stripe subscriptions in your existing account, so your revenue history doesn't break when you turn it on. Two things to watch:

You'll run two populations side by side. Old subscribers stay on standard Stripe, and new ones go through Managed Payments. Your MRR stays in one place, but if you compare fees or net revenue, split by cohort.
Fees in Stripe reports include withheld tax. In balance and payout reconciliation reports, the fee column combines Stripe fees and the tax Stripe withheld. Use fee_net_of_withheld_tax to see what you actually pay Stripe, or your fee rate will look far higher than it is.

Coming from Paddle or Lemon Squeezy is a real migration: subscribers have to check out again, and revenue history lives in two systems. See how to migrate from Lemon Squeezy without losing MRR history and switching between Stripe and Paddle.

Should You Use Stripe Managed Payments?

Use it if:

You already sell through Stripe Checkout or Payment Links
You sell a digital product to consumers or small businesses in many countries and don't want to register for tax everywhere
You'd rather pay a bit more than migrate to another platform
You want to test a merchant of record on new products or markets first

Look elsewhere if:

You're picking a merchant of record from scratch. Paddle is cheaper on subscriptions, and Creem or Dodo Payments are cheaper still.
You need a custom checkout, a custom domain or a Connect platform
Most of your customers are US businesses. Standard Stripe with Stripe Tax is much cheaper, and the tax work is usually manageable.
You sell services with human involvement, which aren't eligible

Not sure? The free Which Payment Provider Should I Use? quiz asks six questions and ranks the options for your business.

Frequently Asked Questions

Is Stripe a merchant of record? Standard Stripe isn't: you're the seller and responsible for tax. With Stripe Managed Payments, Stripe (via Link) becomes the merchant of record for eligible digital products.

How much does Stripe Managed Payments cost? 3.5% per successful transaction on top of standard Stripe processing fees, calculated on the full amount including tax. Stripe Billing (0.7%) is extra for subscriptions, so a US subscription costs about 7.1% + $0.30.

Is Stripe Managed Payments cheaper than Paddle? No. On published prices, Paddle's 5% + $0.50 is cheaper for subscriptions at every price point we tested. Managed Payments makes sense mainly when you already run on Stripe and want to avoid a migration.

Can I move my existing Stripe subscriptions to Managed Payments? No. Only new subscriptions bought through a Managed Payments Checkout Session are covered. Existing subscriptions stay on standard Stripe.

Which countries does Stripe Managed Payments support? Your business must be based in the US, Canada, the UK, most EU countries, Switzerland, Norway, Liechtenstein, Australia, Hong Kong, Japan or Singapore. Customers can buy from more than 195 countries and territories, and Stripe handles tax compliance in more than 80.

What happened to Lemon Squeezy? Stripe bought Lemon Squeezy in 2024. In January 2026, Lemon Squeezy said its merchant-of-record future is being built through Stripe Managed Payments. It still operates, and no shutdown has been announced. See Lemon Squeezy vs Stripe.

Does Managed Payments work with Stripe Connect? No. Platforms, marketplaces, Express accounts and accounts controlled by a platform aren't supported.

Track What You Actually Pay

Whichever provider you choose, your real fee rate depends on your plan mix, refunds and where your customers are. Chartsy connects to Stripe, Paddle, Lemon Squeezy and other providers and shows your MRR, churn and revenue in one dashboard, so you can see the effect of a pricing or provider change instead of guessing.