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Stripe Tax

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Re: Stripe Tax

#191

Post by vvoyer »

GordonS wrote: post #173
vvoyer wrote: post #71

Earlier quoted context omitted.

Nope, if you have $100k transactions in a year, it will be $100,000 * 0.005 = $500 not $4,000 (And 0.4% is when you make more than $50,000 in a month) I too made the mistake of doing amount*0.05 when they provided me the pricing in beta. This is why I went with them, if I can't do a simple percentage computation I'd rather not do the taxes myself. And if you're making $1M a year, it will then be $4,000. And I guess t…

When I saw this announcement, I had fully expected these new features to be included as standard - I was a bit surprised when I saw they were charging for them. That said, I think the pricing is well worth it if you're selling B2C. EU VAT is complicated, and I presume state-level sales tax in the US is too. If you're selling B2B in the EU however, then all you really need to do it collect and validate VAT registratio…

Hey there, I believe validating VAT numbers is outside of the Stripe tax pricing and part of the Customer Tax IDs API, without any extra charge. Maybe someone from Stripe can confirm?

https://stripe.com/docs/billing/customer/tax-ids

And yes, if you sell only to B2B Europe and everyone inputs their VAT number you're fine (because you actually don't have to charge VAT, it's a reverse charge). Stripe tax do know this nowadays.

But that's actually not so common, people signing up for products usually have no idea what the VAT number of their company is. But they are capable of getting a credit card and giving you a business address.

In this case, you have to compute VAT rates based on the country of the customer.

(This is not an accounting advice, just personal experience!)

Re: Stripe Tax

#192

Post by sudhirj »

Silhouette wrote: post #129
yannoninator wrote: post #19

Earlier quoted context omitted.

YES, considering the only best competitor in this space Paddle takes 5%. Taxes is the reason why in the past most EU/UK businesses go to Paddle. Stripe's Tax feature now saves people who were considering Paddle a lot of time now.

Here's some current Stripe UK pricing, confirmed on their site today. Baseline of 2.9% + £0.20 for international card payments. (It's reduced to 1.4% + 20p for European cards.) Add 2% for currency conversion. The exchange rate used is stated as "the daily mid-market rate provided by our service providers". Add 0.5% for Billing if you're using subscriptions. Add 0.5% more if you're using this new Stripe Tax functional…

The tipping point is the 2% for currency conversion, but keep in mind that this is happening either way on Paddle as well, just not going to Paddle. Paddle takes 5%, then the entity that converts from USD to your currency (Payoneer / wire transfer bank) takes the 2% or more. Stripe calls it out clearly and gives you your money in your own currency.

Re: Stripe Tax

#193

Post by corentin88 »

I was dealing with taxes using Stripe Checkout so far, and to be honest it’s far from perfect. Worth looking around this new feature, but feel like they haven’t done much and are going to take 0.5% of every transaction!

Re: Stripe Tax

#194

Post by titanomachy »

kmoriarty wrote: post #41
tylermenezes wrote: post #11

Maybe someone from Stripe is reading the comments and can explain: why do refunds not reduce the reported tax collected? Are we supposed to keep separate records of that?

Good question! You can create a Credit Note, which will indeed shift the liability and will correctly reference and update the prior legal invoice. If you’re refunding a PaymentIntent however, we won’t shift the liability. Basically, we offer you two ways to move money back to your customer: one that might be a higher lift which ensures your accounting is updated and the liability if shifted, or a much easier way to…

“Higher lift” means “more work” in this context.

Re: Stripe Tax

#195

Post by spiralganglion »

nickpp wrote: post #159
tylerrobinson wrote: post #152

Earlier quoted context omitted.

The developer experience and ease and speed of integration are second to none. They managed to take a commodity service performed by many incumbents and make it so effortless that it blows away the competition.

Yes, I heard that (couldn't test it myself). The integration for Avangate for example was a proof-of-concept PHP file and a couple of docs explaining the CGI parameters. Not great but not that horrible either. But were those so incredible that it made up for the missing features? I mean if it was me I wouldn't implement the sales tax myself in a million years, no matter how nice the experience and integration was...

Stripe came up in an era when nobody in the US worried about taxes, generally speaking. That's changing now.

Re: Stripe Tax

#196

Post by maxmcd »

nickpp wrote: post #148

Honest question: can somebody enlighten me about Stripe's appeal? I am not an user (until recently they weren't even available in my country) but I used ShareIt (now Digital River) 20 years ago and Avangate (now 2checkout soon Verifone) in the past 15 years and they both: - had a much larger international presence, with localizations and everything - had sales taxes, VATs etc computed from day one - had cart (not sur…

I have to say that when I first evaluated Stripe I was comparing it to things like authorize.net. I haven't meaningfully looked at the other available options since. Stripe is easy and known and I haven't gotten org pushback about it. So maybe just ignorance?

Thanks for sharing these options.

Re: Stripe Tax

#197

Post by kmoriarty »

teamspirit wrote: post #170
tzs wrote: post #144

Note that if you are just interested in US sales taxes, and only need to collect tax in the ~1/2 of the states that are part of the Streamlines Sales Tax (SST) project, you can have your tax rate calculation, registration, reporting, and filing all done for free . The member states of SST have agreed to pay for those services from several tax SaaS companies. (There is one catch: to avail yourself of this, you must co…

How quickly my excitement disappeared when I saw that California was not a member. Thanks for the information; I'm sure there are others, like myself, that have no idea such a thing exists.

This is spot on. It's an interesting program perhaps, but unfortunately a lot of states are missing including California, Texas, Colorado, Florida, Illinois, New York, Massachusetts, South Carolina, and we're not seen any uptake from other states toward adoption either.

Re: Stripe Tax

#198

Post by legitster »

When we implemented Stripe, our team was flatly frustrated that this wasn't already included in Stripe. It spawned a lot of arguments as to why we were even using Stripe over just a normal payment gateway. Having to calculate sales tax was a much harder problem for us than what Stripe was solving.

Although paying .5% on every transaction just to do a lookup on a table of what should be public information is still frankly absurd. For all of the lip service given to ease of doing business, governments still enable a lot of rent seeking in the process.

Re: Stripe Tax

#200

Post by imhoguy »

ldd wrote: post #180

Really interesting! I have a very small video game business (emphasis on small) and I already use Stripe to handle non-EU digital purchases. I specifically avoid taking money from EU customers because I briefly looked into the tax requirements and it seemed onerous. The registration process for really small businesses that did online sales was very weird, and unlike Canada or the US, the threshold question seems to b…

If your sales is small better stay away. Find "Merchant of Record" or reseller who will cover all that mess for you. There are many: Gumroad, Paddle, FastSpring...
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