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Stripe Tax

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Re: Stripe Tax

#131

Post by dangrossman »

kybernetikos wrote: post #108
xchaotic wrote: post #35

Ben Evans once described Stripe as tax on Internet SaaS. For a moment I’d thought it was Stripe admitting the same.

Credit card fees in general are like an extra tax. And credit card companies have so much power they have pushed the cost onto all transactions, even those that use cash (by forcing merchants to eat the cost difference, they push all prices with that merchant up).

This is something people say often, but studies put the cost of accepting cash for retailers at 4.7-15.3%, which is higher than the cost to accept credit cards. If anything, it's the high cost of handling cash built into prices that's increasingly burdening credit card users in stores, not the other way around.

Re: Stripe Tax

#133

Post by bberenberg »

kmoriarty wrote: post #112
jitbit wrote: post #90

So. After 10 years in business and THOUSANDS of customer requests (I even made one myself, in-person when I met Patrick Colison at a conference) Stripe has introduced... a calculator. And you still have to do everything yourself - filing the papers and wiring money. Thanks, but no thanks. I'll stick with my current payment provider that handles _everything_. I do admire Stripe and wish I could move some day :(

Thanks for the feedback. We’re working toward an end goal of making tax compliance as simple as clicking a button. In talking with users they called out three big pain points: knowing what the obligations are, knowing what rate/rules to apply and how to calculate tax (e.g. SaaS is taxable at 80% of the base rate of the price in Texas), and then how to file and remit the money once collected. Stripe Tax solves the fir…

TaxJar won't handle global. SaaS is inherently global. Your own docs point to other providers for EU. Ultimately you need to have a Stripe MoR option.

Re: Stripe Tax

#134

Post by snemvalts »

Naga wrote: post #56

That looks great, but that's a ridiculous pricing scheme. If you invoice $100k in a year, you're paying $4000 to Stripe to manage your sales tax. A lot of the issues with sales tax are not knowing your regulatory requirements and set up. I'd say that's probably worth $4k, but then going forward you still have to pay them that amount. I'd say it would be more worthwhile to pay an accountant to do that for you, and sav…

Please double check your math before doing a hot take paragraph.

Re: Stripe Tax

#135

Post by andylynch »

gardaani wrote: post #15
beilabs wrote: post #9

Wouldn't most online businesses just need to collect the taxes for the customers that their business operates in? Posting this on the basis that there should be no stupid questions when it comes to tax. For example; an Australian business needs to collect GST for Australian customers only. Americans accessing the Australian service would not be obligated to pay GST and as the Australian business doesn't have a US ent…

Paddle has a good article about this: "..the taxes apply not only to where your company has a physical presence (an office or employees) but to where your customers are based." https://paddle.com/blog/global-sales-taxes-for-software-comp... It seems to be a huge mess. Even if you know how much to pay for different countries, registration for paying taxes can be painful.

Even domestically - US interstate sales tax rules are a mess too.

Re: Stripe Tax

#136

Post by jitbit »

HatchedLake721 wrote: post #118
jitbit wrote: post #90

So. After 10 years in business and THOUSANDS of customer requests (I even made one myself, in-person when I met Patrick Colison at a conference) Stripe has introduced... a calculator. And you still have to do everything yourself - filing the papers and wiring money. Thanks, but no thanks. I'll stick with my current payment provider that handles _everything_. I do admire Stripe and wish I could move some day :(

What's the other solution? Stripe to become merchant of record like Paddle.com?

Yep, operating as a "reseller" paper-wise. We currently use FastSpring for that

Re: Stripe Tax

#137

Post by fastball »

Our company was part of the beta and we were having buggy issues when trying to use Stripe Tax alongside the Customer Portal, which AFAIK they haven't resolved yet. So just FYI if you implement and bump into this, it's them not you.

Re: Stripe Tax

#138

Post by franciscop »

This is so on point. About a year ago I was thinking of opening a company and selling digital products with Stripe in Japan (where I live). They offered a quick free call to answer my questions, and I did so. I am not fluent in Japanese so any help I'm offered I take it, and I wanted to know how many other troubles I could face at this endeavor.

All my questions were answered promptly and greatly by them, and I was getting more and more convinced to do it. Until I asked, "Stripe handles sales taxes, right?" and the answer was "no". They gave me a brief overview of how that works though. Let me tell you I know why you don't see an "Amazon of Japan", apparently in here I'd have to calculate the sales taxes for every country where my products are sold through agreements of Japan-{said country}. Some countries don't even have agreements like Brazil so they are in a gray area.

It seems like Stripe Tax might be a game changer for this specific situation! I'm not ready right now personally/professionally to try to do the company, but let's see in 6 months - 1 year. I am so jubilant!

PS, this is from a quick conversation I had ~1 year ago, so some small details might be fuzzy/outdated/incorrect. Ofc this is no legal or accountant or any kind of advice, just my experience.

Re: Stripe Tax

#139

Post by [deleted] »

Naga wrote: post #56

That looks great, but that's a ridiculous pricing scheme. If you invoice $100k in a year, you're paying $4000 to Stripe to manage your sales tax. A lot of the issues with sales tax are not knowing your regulatory requirements and set up. I'd say that's probably worth $4k, but then going forward you still have to pay them that amount. I'd say it would be more worthwhile to pay an accountant to do that for you, and sav…

[deleted]

Re: Stripe Tax

#140

Post by andylynch »

throwaway368392 wrote: post #132

Does that mean a small US-based B2B SaaS with no EU nexus have to pay EU VAT? It seems overreaching.

Only if you meet the volume thresholds, which vary by country - e.g. for sales to Ireland you must register and pay VAT if your sales are over EUR 35k / year, but in Germany its 100k.
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