LemonSqueezy vs Paddle
Pricing
LemonSqueezy: 5% + 50c per transaction
Paddle: 5% + 50c per transaction
Description
LemonSqueezy: Sell digital products and subscriptions globally: they handle all the tax compliance
Paddle: Payment platform that handles global taxes for you: they are the seller, you get paid net
Pros
- Merchant of record handles VAT, sales tax, and invoicing in every country
- Built-in affiliate system so your customers can sell for you
- No monthly fees: you only pay when you make a sale
- Merchant of record means they handle VAT, sales tax, and invoicing worldwide
- Built-in subscription management with dunning and recovery
- You never have to file taxes in foreign countries
Cons
- 5% + 50c per transaction is expensive compared to Stripe's 2.9% + 30c
- Its team says support is slower and updates less frequent while it builds Stripe Managed Payments
- Less customization than building your own checkout with Stripe
- Checkout and storefront design options are limited
- 5% + 50c is nearly double Stripe's rate
- Approval process required: they review your business before you can start
- Less flexibility than Stripe for custom checkout flows
Details
LemonSqueezy is Paddle but friendlier for indie founders. Like Paddle, they act as the merchant of record: they collect the payment, handle all international taxes, and send you a net payout. Unlike Paddle, there is no approval process and no monthly minimum. You sign up and start selling.
The 5% fee hurts on every transaction, but do the math: if you sell $5,000/month, LemonSqueezy costs you $250 in fees. An accountant to handle international VAT filing costs more than that. If you sell exclusively in one country or only in the US, Stripe is cheaper. If you sell globally and do not want to think about tax compliance, LemonSqueezy trades money for sanity.
Stripe owns Lemon Squeezy. In a January 2026 update, the team said it has been building Stripe Managed Payments, Stripe’s own merchant of record product, and that its goal is to give Lemon Squeezy users an easy way to move to it. Managed Payments was then invite-only and available to merchants in 35+ countries. The same update warned of slower support responses and less frequent product updates in the meantime. Lemon Squeezy is still operating with the same 5% + 50c fee, but if you are choosing a merchant of record for the long term, check where that move stands.
Paddle takes the scariest part of selling software internationally (tax compliance) and makes it someone else’s problem. They act as the merchant of record, which means they are legally the seller. They collect the payment, handle VAT/sales tax in every country, and pay you a net amount. You never file a foreign tax return.
The price for this peace of mind is real: 5% + 50c per transaction versus Stripe’s 2.9% + 30c. For many SaaS founders selling to customers in the EU, UK, and beyond, the math still works out: hiring an accountant or using a tax service would cost more. Paddle requires approval before you can start, so apply early.
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