[HN Gopher] Stripe Tax ___________________________________________________________________ Stripe Tax Author : sirodoht Score : 791 points Date : 2021-06-10 12:09 UTC (10 hours ago) (HTM) web link (stripe.com) (TXT) w3m dump (stripe.com) | rorykoehler wrote: | Finally | arnon wrote: | Note this big gotcha: | | Stripe's VIES validation only takes place once and there is no | way to retrigger it. | | For compliance purposes you have to validate it yourself every | quarter or so, on recurring transactions. | kmoriarty wrote: | Hey there! I'm the PM for Stripe Tax, I'd love to hear more | about your use case around how frequently you'd want us to be | revalidating VAT IDs, the information you'd want returned, and | of course any other tax-related requests you may have: | kmoriarty@stripe.com | blntechie wrote: | Stripe makes such complex products appear so simple. Their | product pages are art of work. Amazing company. | MichaelApproved wrote: | Like, every single time. Their execution is amazing. | | Serious question, have any of their products had a poor | rollout? | | I'm not asking about a feature you'd prefer that's missing. I'm | asking about something being buggy, poorly documented, or | having a confusing marketing page. | porker wrote: | > Serious question, have any of their products had a poor | rollout? | | Yes. Payments with SCA2. Very poorly documented when rolled | out, and TBH the docs aren't much easier to navigate now once | you get off their "do everything immediately client-side" | happy path. | | I've never known them to be buggy, but in this space there | isn't room for bugs. | Silhouette wrote: | Yes, their PSD2/SCA roll out was disastrous. The | documentation is marginally better now, and to their credit | they've also produced a lot of example code repositories | showing end-to-end implementations of various scenarios in | various programming languages. But then, the epic scale of | a full API integration and the moderate scale of even a | Checkout integration today, as shown in those docs and | sample repos, only highlight how painful the whole process | has become. Then you look at the modern services that are | going back to what early Stripe did so well, handling most | of the pain of charging customers for you with very | straightforward integration requirements, and the | differences are stark. | lolinder wrote: | The new additional transaction fee for Stripe Billing is | awkward. They charge an extra 0.5%, which is fine, but it | always comes out as a separate transaction instead of being | added on top of their regular transaction fee. Sometimes it | gets withdrawn from your balance _after_ they 've already | deposited your earnings, leading them to make a withdrawal | from the bank. | | Not a huge deal, and I still love Stripe! | corentin88 wrote: | 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! | jackerman wrote: | We're always working to improve Stripe Checkout, and very open | to your feedback. Feel free to drop me a note at | jackerman@stripe.com if you'd like to chat about Checkout! | moneywoes wrote: | How does this compare to using TaxJar? | tylermenezes wrote: | 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? | kmoriarty wrote: | 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 refund, but you | may pay some tax out of pocket. | titanomachy wrote: | "Higher lift" means "more work" in this context. | yarcob wrote: | Presumably because it's hard to do correctly, and Stripe chose | to focus on the easier part. | | For example, I need to report VAT on the 15th of the second | following month. If I got a refund after that date, I have | already reported that tax, and I need to report a correction. I | can't just report a lower tax the next time. | | If you don't have a lot of refunds, then just paying taxes that | you don't owe may be cheaper than handling it correctly (which | is a lot of effort). And it may be the safer option -- nobody | is going to fine you for paying too much tax. | [deleted] | jerrygoyal wrote: | Would it be wrong to say that Stripe is the most valuable company | for internet businesses? | Taek wrote: | We started using Stripe recently for a worldwide base of | customers and I was a bit flabbergasted that Stripe didn't have a | tax solution already built in. | | Taxes are a PITA, and in my opinion this product from stripe | makes enormous sense. If it's as good as everything else they do, | it'll simply our lives enormously. Super happy to see this being | released. | bsears wrote: | Co-founder of Billflow here. | | We were lucky enough to be able to integrate the Stripe Tax beta | with Billflow. In my opinion this is the coolest thing Stripe is | launched (For SaaS) since they came out with subscriptions. It | just works(tm). | | Implementing Stripe Tax was dead-easy, to get it working we | essentially just had to switch a boolean to true on our | subscription creation code. | | Also, the new functionality of the upcoming invoice API is | something we've been wanting for a while - being able to estimate | the first invoice for a subscription _without_ the customer | existing beforehand makes life so much easier when checkout is | concerned. | | Huge props to the Stripe team, love this product! | yannoninator wrote: | This is absolutely _HUGE_. | | If you're an indie hacker, or solo founder taxes are _extremely | important_ and you cannot ignore them if you go over a certain | amount. | | In the past taxes, VAT and all of that is a pain in the backside | for most EU / UK businesses and most go with Paddle because of | this. | | I am so elated that this is now available (although through an | invite), and saves a TON of time, unnecessary annoying scripts | and duck tape. | | Downvoters: So you can manage taxes and VAT for each different EU | member state yourself manually? Is this some sort of side hobby | for you? This is a _real_ problem of many businesses. | Fraaaank wrote: | Isn't the EU B2C tax burden solved by the introduction of the | one stop shop per July 1st of this year? | | https://ec.europa.eu/taxation_customs/business/vat/oss_en | yannoninator wrote: | You still have to calculate all taxes from Stripe from these | EU regions and _then_ do that. For those using Stripe before | this announcement it was a huge time sink. | tzs wrote: | 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 collect tax for all SST states, even | though you might be below the threshold in some of them). | | The companies participating are Avalara, TaxCloud, Sovos, and | Accurate Tax. | | For small online businesses I suspect that a lot more can take | advantage of this than you might expect. Here's a map showing the | SST member states [1]. Although it is missing some big states | that you probably do a lot of business in (California for | instance), a lot of those big states have quite high thresholds | for sales or number of transactions before tax kicks in. | | Some of the companies that provide the fee SST service will also | add non-SST states for a fee. If you only need one or two non-SST | states, it will still probably come out cheaper than using Stripe | (and will include reporting and filing). | | [1] https://www.streamlinedsalestax.org/ | ilikehurdles wrote: | Disappointing that I live in the only non-participating state. | Wonder what motivated Colorado to reject this. | KingMachiavelli wrote: | Interesting. Why is CO not participating? Looks like every | other state is involved to some extent. | gamblor956 wrote: | CO has a very unique sales tax system: every county, city, | and special district can set its own rates, and define | taxable (or nontaxable) product categories, and determine the | taxability of of those product categories, and even apply | special (formulaic) discounts for complying with the tax | regime. Plus, a number of tax jurisdictions _overlap._ And | this is the _simplified_ system that the state implemented in | 2019 to make things easier for remote sellers in a post- | Wayfair world. | | And that doesn't even include the roughly 70 home-rule cities | which administer their sales tax separately from the state's | "simplified" tax system. | | For filing purposes, each CO "tax location" is treated as a | separate return by Avalara and other sales tax services | providers, so the costs can add up very quickly for remote | sellers using these services for sales tax reporting | compliance: Denver alone has more than two dozen separate | "tax locations." Consequently, at my company we use Avalara | to compute sales tax for remote sales to CO but file the CO | returns ourselves and save several thousand $$$ each month. | | Luckily, due to Wayfair nexus requirements, CO sales tax | compliance only kicks in at 100k or more in gross sales _to_ | CO (not including sales to home-rule cities). Because each | home-rule city has its own sale tax system, the nexus | threshold is independent for each home rule city; the state | has advised these cities to set a threshold of $100k to avoid | nexus-related litigation that could result in a bright-line | rule setting an undesirably high threshold for nexus. | velcrovan wrote: | Because Colorado has the most garbage sales tax regime in | probably the world. | Cerium wrote: | Based on my personal experience I would recommend staying away | from TaxCloud. When they make mistakes filing for you (and they | have) the states will come to you directly with scary letters, | TaxCloud won't answer your calls or messages. The only way I | was able to sort things out was by getting another states small | business advocate to help. | | TaxCloud also has a habit of changing their fees without | notice. Currently they charge an API access fee even for their | "free" accounts. | | Finally, they lock you in by not giving you enough information | to cancel all the accounts they started for you in other states | but not providing a clear way to cleanly close your account. | cryptoized wrote: | Thanks for the insight, I hope SST get more adaption.... | https://www.streamlinedsalestax.org/. | teamspirit wrote: | 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. | kmoriarty wrote: | 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. | tzs wrote: | I'm somewhat baffled by California not being a member. | | California's threshold below which out of state remote | sellers do not have to register, collect, report, or remit | sales tax is $500 000/year of sales into California. | | If I'm a remote seller using the free SST option to handle my | taxes in the SST states, and am selling say $300 000/year in | California, I will not be collecting any California tax. | | If they joined SST, I would have to collect California tax | even though I'm below the threshold because the deal to get | free full service tax handling under SST is that I collect | for all SST states. | | I don't see any downside for California. At the stroke of a | pen, they would suddenly be getting tax collected from a ton | of remote sellers that fall below the $500 000/year | threshold. | | Same with Texas, which also has a $500 000/year threshold, or | New York which is $500 000/year and 100 transactions, or | Florida which is $100 000/year, or Illinois which is $100 | 000/year or 200 transactions. | gamblor956 wrote: | California is not a member of the SST because it does not | currently tax a number of things that are subject to tax | under the SST regime. For example, digital goods are | taxable in SST states but not in California. | | Similarly, there are a number of other product categories | where CA's taxability classifications do not match the | SST's classifications. | | Generally, the total tax they could collect from remote | (non-CA) sellers below the $500k nexus threshold is not | worth the effort it would take to change things so that CA | could join the SST, and moreover, it would require | significant changes by CA sellers. | | Generally, those same considerations also apply in NY: the | cost burden on local sellers to make the change would dwarf | any minuscule tax increase from joining the SST. | spockz wrote: | Interesting. People bemoan that the market in Europe is | too splintered and that the whole of the us can be seen | as one market. But all these state differences seem to at | least indicate that it isn't that simple. | germanier wrote: | Interestingly, VAT law is mostly harmonized in the EU and | remittance will get even easier starting July where you | can declare and pay VAT on cross-border sales to just one | entity ("One-Stop-Shop"). | tzs wrote: | The US could really use some national action on sales | taxes. | | I'd like to see Congress make it so a state can only | require remote sellers with no physical presence in the | state to collect tax for the state if: | | 1. Tax rates on remote sales are uniform within a zip | code. No more having to deal with "123 Fake Street, | Hooterville, 65026" having a different tax rate than "124 | Fake Street, Hooterville, 65026". (Worse, I recall | finding an example where a tax boundary apparently ran | through an office building, so different offices on the | same floor had different tax rates!). | | 2. They adopt a standard for tax classification that will | be specified by the Federal government. They don't have | to change the classifications used for taxing sellers | with a presences in the state, but for remote sellers | they have to use the Federal classifications. | | 3. Rates for remote sales can only change once per | quarter, and the data for the quarter must be published | one month before the start of the quarter. It must be | published on the web, at a URL that requires no | registration or fees, in a format specified by the | Federal government. The Federal government would maintain | a web page that contains links to the state data pages. | | 4. Sellers can report taxes using a uniform format | defined by the Federal government. The format supports | reports that cover the taxes for more than one state. The | seller can file such a multi-state report with any state | that requires remote sellers to collect tax that they owe | tax to, and that state will forward the report to the | other states it contains data for. The seller can also | pay all the tax to that state, and it will transfer the | appropriate amounts to the other states. | | If Congress did this it would make dealing with remote | sales tax so much easier. | gamblor956 wrote: | 1. Congress does not have that power, as it would | interfere with the states' control of in-state commerce. | They could however make that a requirement for requiring | out-of-state sellers to comply with sales tax. | | 2. Same as #1. | | 3. Rates for sales tax generally change every few _years_ | as it requires an unbelievably large amount of | notification to sellers, service providers, etc. Where | sales tax rates change faster than that, it is usually | part of a pre-planned and pre-published change in rates | occurring over several years. A sales tax rate changing | annually is actually fairly uncommon; a sales tax rate | changing more frequently than annually (absent special | circumstances like COVID19 incentive rates) is extremely | rare. | | 4. This is basically the purpose of the Streamlined Sales | Tax, which is an initiative of over two dozen states to | streamline sales tax compliance: only a _single_ return | is required and it covers all of the member states. | However, it is voluntary. | | Note that your suggestion for payment is unfeasible, | since it would require each payment to also include the | tax liability data for every other state, and each state | would have to set up a separate bureaucracy to handle | money transfer. It's faster and more efficient for | taxpayers and states to simply have the taxpayer use | existing payment mechanisms to pay each state separately. | On the taxpayer side, it's literally seconds more work if | you're using a unified tax system (like the SST). | xxpor wrote: | Does Congress have that power? I suppose you could argue | they're interstate commerce regulations, but idk if | that'd fly. | | Edit: Obvious SD v Wayfair is relevant here, https://www. | supremecourt.gov/opinions/17pdf/17-494_j4el.pdf | | It's too complex to even take a stab at guessing what | they'd say based on that though. Also, I'd forgotten what | a wild lineup the votes were. | | GINSBURG, ALITO, and GORSUCH, JJ., joined. THOMAS, J., | and GORSUCH, J., filed concurring opinions. ROBERTS, C. | J., filed a dissenting opinion, in which BREYER, | SOTOMAYOR, and KAGAN, JJ., joined. | | Edit again: Seems Roberts agrees Congress can do | something: | | Roberts noted that Congress has been considering whether | to alter the physical-presence rule, and "nothing in | today's decision precludes Congress from continuing to | seek a legislative solution. But by suddenly changing the | ground rules, the Court may have waylaid Congress's | consideration of the issue." | | The majority "proceeds with an inexplicable sense of | urgency," the chief justice said, and it "breezily | disregards the costs that its decision will impose on | retailers." | | There are complex distinctions made in more than 10,000 | taxing jurisdictions, he said. | | "New Jersey knitters pay sales tax on yarn purchased for | art projects, but not on yarn earmarked for sweaters," | Roberts said, while Texas imposes a sales tax on plain | deodorant but not on deodorant with antiperspirant, and | Illinois treats Twix and Snickers bars differently for | sales-tax purposes. | | https://www.scotusblog.com/2018/06/opinion-analysis- | court-ex... | mywittyname wrote: | Probably not to enforce standards, but they certainly | have the power to _create_ standards and incentivize | their use. Much in the same way they can 't control speed | limits on national highways or the drinking age in | various states, yet these laws are largely uniform across | the country. | xxpor wrote: | Those rules have to be on a funding source that's | plausibly related and it has to be non-coercive. I'm | struggling to think of a relevant funding source here. | kelnos wrote: | > _Those rules have to be on a funding source that 's | plausibly related and it has to be non-coercive._ | | That seems to not be the case in practice. Highway | funding is dependent on states setting a legal drinking | age no lower than 21. Those two things are not plausibly | related. And it's definitely coercive. | tzs wrote: | It's kind of hinted at somewhere in _Wayfair_ that this | is really kind of about the defaults when Congress | declines to speak. | | Congress has extremely broad powers to regulate | interstate commerce which would let them decide if and | how states can make sellers in other states collect for | them. So far, Congress has declined to weigh in, and so | we get the default. | | For some things the default is that states cannot do them | unless Congress says they can. For others the default is | that they can do them unless Congress says they cannot. | | With Congress remaining silent, it is up to the courts to | figure out what the default is for a given thing. | _Wayfair_ is essentially saying the older decisions | picked the wrong default. | frankfrankfrank wrote: | Although your belief is a common one even at the highest | levels, reality is that Art. 1, SS8, cl. 2 is not | actually as broad a power as is believed and/or imagined. | People are reading something into that clause that did | not exist when it was written, nor should it exist today. | It is a function of the misunderstanding of what | "regulate" means as it is and was meant, rather than what | today's manipulators or "designing men" as Andrew Jackson | called them, intend to imprint on it. | | When written, "regulate" did not mean control by | authoritarian and dictatorial means, absent of checks and | balances and controls on power as it is implied today, | i.e., "we {insert unelected bureaucratic authoritarian | agency} decree by regulation that you may not do this | thing or that you have to do this thing." What "regulate" | meant when written was to order and bring into purpose | suited structure, to bring into a regular state, opposed | to an irregular state. There was no overt or hidden or | implied sense of manipulation and control implied, it was | a description of state, not action. | | It is something that is to a large extend willingly | overlooked by those who are authoritarian minded, but | this natural entropy of language/meaning and even often | deliberate and intentional manipulation of language and | words (see today's public dialogue and clear and | intentional manipulation of language, i.e., you can say | some things and the meaning and use of other things is | imposed or assaulted), causes excessive amounts of | problems. A good example of this kind of change, is the | word matrix; that means a pattern of lines or marks, | usually in a uniform layout, which used to mean nothing | more than a female breeding animal since time before | records and well into the 18th century, including even | today in niche agricultural circles. The connection to | the breeding female coming from the sense that a | mathematical matrix is a component into which quantities | can be set, or bred into. | | Congress does not technically have the right to control | commerce, let alone trade, but it does have the power to | set commerce into and orderly, or regular state; opposed | to an irregular state, i.e., into a wanton and | unpredictable state. That does not include using its | powers to change or manipulate it with objectives or | outcomes in mind. | | But regardless of what I say or even the founders meant, | the great powers of human hive-mindedness and whoever can | control it will ultimately determine the outcome and | impacts. We are rapidly approaching a state where | everything and anything in the Constitution is | essentially put through an authoritarianism conversion | where everything is interpreted as meaning centralized | control and power, while always and relentlessly | stripping individuals of power and control over their own | lives and freedoms ... all by changing language, which is | precisely why certain groups are so focused on changing | the language, because if you change the meaning of | freedom to slavery, then you are halfway to 1984. | lupire wrote: | Fascinating claims. Can you link to any legal treatises | that explain this idea further? | ploffmaxys wrote: | Sorry Ot and won't sound offensive, but i am reading each | 'commerce' interpreted with 'ads' -so my two cents... (-; | | comic #646 are you in a partisan state ?: > | //abload.de/img/646_en_areyouinapartisxjts.png | bsimpson wrote: | TIL states can now force out-of-state companies to | collect and remit taxes. | codehawke wrote: | Yeah, it sucks. However, not all goods, not all states | even have an existence of a nexus. Virginia specifically | exempts sales taxes of digital products delivered | electronically, such as software, downloaded music, | ringtones, and reading materials. | | The basic rule for collecting sales tax from online sales | is: If your business has a physical presence, or "nexus", | in a state, you must collect applicable sales taxes from | online customers in that state. If you do not have a | physical presence, you generally do not have to collect | sales tax for online sales. In the court ruling that | allowed this, it was determined that Wayfair did have a | nexus in those states. Not all businesses operate that | way and there are a lot of gray areas. | tzs wrote: | > If you do not have a physical presence, you generally | do not have to collect sales tax for online sales. | | That was how it stood _before_ the Wayfair ruling. Under | Quill Corp. v. North Dakota (1992) and others, the Court | had ruled that states did not have the power to force out | of state sellers to collect tax for remote sales unless | the seller had a physical presence in the state. | | Wayfair overruled Quill. The Court created a new kind of | nexus, an "economic" nexus, and ruled that an economic | nexus was sufficient to allow states to force out of | state sellers to collect. | | Merely selling a sufficient volume into a state is | sufficient to create an economic nexus. They didn't give | any hard and fast rule for deciding what is a sufficient | volume, but the state involved in the Wayfair case, South | Dakota, was trying to charge tax on any out of state | seller that had more than $100 000/year in sales or more | than 200 sales per year in South Dakota so we know that | is on the "sufficient volume" side of things. | | The rule for online sales tax in the US is now this: | | 1. If you sell online to customers in state X, you need | to look up that state's economic nexus law to see what | their threshold is. Here's a good place for this [1]. | | 2. If your sales volume is not under the threshold, you | need to check to see if that state exempts your | particular product or service. | | If you hit the threshold and there is no exemption, | welcome to hell. | | [1] https://www.avalara.com/us/en/learn/guides/state-by- | state-gu... | quercusa wrote: | The $500,000 threshold is, IIRC, for companies that don't | have a 'nexus' in California. As of a few years ago, having | a single remote employee in California was enough to create | a nexus, causing you to be treated as a California-local | company. | ysavir wrote: | I had no idea this was a thing! You should submit it to HN as | its own item. | koonsolo wrote: | I was recently looking for a way to sell my digital product. | | I was surprised how complicated all these solutions are. First of | all, I want a 'merchant of record' to handle my taxes, which | basically gets rid of most payment solutions. | | Secondly, I want an easy to use affiliate program where I can add | affiliates. | | Oh man, they almost all work with some complex external affiliate | service. | | I used to sell my indie game with Plimus (around 2009), which is | now BlueSnap, but even they are now really complex and working | with external affiliate network. | | Ended up with Gumroad, which has all of these things, in a very | simple and clear way. Now I understand why they are so popular. | dangoor wrote: | Agreed. Payhip is another one. | jokethrowaway wrote: | This is great! ATM I'm banning all EU end users from purchasing | my SaaS unless they're a business because the cost of handling | VATMOSS is just not worth it. | | It also definitely played a role in choosing to do a B2B service | over a B2C one. | | So now the choice is: | | - File VAT yourself, pay 3.5% + some pennies to Stripe - Pay 5% | to Paddle and they file VAT for you | | Definitely glad to see more competition in this area. | sandlerben wrote: | Actually, Stripe's payment fees are lower for European | merchants (because card interchange is lower) so it would be | more like 1.9% plus some pennies. | | https://stripe.com/en-de/pricing | tzs wrote: | What makes handling VATMOSS costly for an Saas? | | I deal with the software end of dealing with VAT for a small | company that sells downloadable software and technical support | for that software. We've not found it costly at all. | | It took one guy a couple days or so to get registered with | Ireland for VATMOSS. | | To do the quarterly report for filing, I run a fairly simple | script I wrote that produces a CSV file with one row per | country giving the total sales and the total VAT we collected | for that country, and someone uploads that to a form on the | Irish tax authority site, which I understand is a simple and | straightforward process. | | To keep track of VAT rates, we use https://vatlayer.com/ | | Their API for getting rates is very simple, and their free plan | allows 100 API calls per month. It is one call to get the rates | for all VATMOSS countries. | | The reporting script needs to get exchange rates to calculate | the VAT in EUR for those sales where the customer paid in GBP | or USD. The EU makes that information available in this handy | XML document: | https://www.ecb.europa.eu/stats/eurofxref/eurofxref-hist-90d... | | That contains the exchange rates between various currencies and | EUR for the last 90 days. The rate you want for VATMOSS is the | rate on the last business day of the quarter you are reporting | for, so there is a little bit of calculation to figure out | which day's rate to use. | | They also have one that gives the most recent day if that | better floats you boat: | https:///www.ecb.europa.eu/stats/eurofxref/eurofxref-daily.x... | | If you need a specific range of dates for specific currencies, | they've got that covered too. Here it is for USD and GBP: | https://sdw-wsrest.ecb.europa.eu/service/data/EXR/D.GBP+USD.... | | Specify the range by adding query parameters startPeriod=YYYY- | MM-DD and endPeriod=YYYY-MM-DD. | hirako2000 wrote: | I find this revealing the absurdity of the taxing systems we live | in. | smashah wrote: | letttss goooooo!!!! yesss!!!! | [deleted] | jmann99999 wrote: | Our SAAS has to calculate sales tax on the fly for purchases in | the US. We don't charge credit cards but invoice the customer | later. However, the tax calc is the same. We use an API [1] from | a company called Strikeiron that was purchased by Informatica. We | pay about $75 per month for tens of thousands of sales tax | lookups by city/state/zip. | | If we were taking credit cards, we'd look at Stripe's solution. | It would be much less expensive than what we are doing today. | | [1] https://www.informatica.com/products/data-quality/data- | as-a-... | BasedInfra wrote: | Stripe's product pages are so beautiful and cover the product | features brilliantly. | | Stripe tax should away the headache of being on the wild ride | that is EU VAT as EU citizen. | | Congrats on the launch! | nickpp wrote: | 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 sure about ShareIt though) & API | | - integrated countless payment gateways: from credit cards to | purchase orders, wire transfers and even PayPal | | How comes Stripe won even if they arrived much later on the | market? I believe their pricing structure was not very far from | the competition. What did they offer to attract users even though | they lacked such important features? | | I want to learn. | alasdair_ wrote: | Disclaimer: I now work at Stripe but the following was purely | when I used them as a user: | | Stripe targeted developers from day one and made it extremely | simple to get up and running (literally seven lines of code for | a working payments system) and they documented their api very | well. | | Then they added on a lot of stuff that made me (as a user) | happy, like paying out to my bank account a lot more quickly | than the competition, adding recurring subscriptions with a few | more lines of code etc. | | Basically, their systems just worked out of the box and were | more polished than others that I used. | maxmcd wrote: | 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. | sumedh wrote: | Stripe's documentation and API integration was so simple | compared to Paypal and others. | nickpp wrote: | I believe that. But on the other hand you had to implement | sales tax - that seems to me a few orders of magnitude more | complicated. Was it worth the tradeoff maybe? | hobofan wrote: | Sales tax is not a "I need this at launch" feature. Many | companies start out in a single market where you can just | hardcode the tax rates if you want, and worry about that | later (and then the engineering hours to add sales tax etc. | are probably not a threat to your existence). | nickpp wrote: | Gotcha. My products were addressing the global market | from day 1 so the ability to automatically send an | invoice with a correctly calculated sales tax to buyers | from any country on the planet seemed vital. Let's also | not forget about collecting and remitting said tax to | correct tax authorities... | bpicolo wrote: | There were companies that filled that gap, like Taxjar | (now acquired by Stripe) | tylerrobinson wrote: | 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. | nickpp wrote: | 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... | spiralganglion wrote: | Stripe came up in an era when nobody in the US worried | about taxes, generally speaking. That's changing now. | ludamad wrote: | Any good references on this? Curious | mixmastamyk wrote: | A couple of years ago, internet sales tax across state | lines started being enforced. I think there was also a | temporary moratorium to build up ecommerce while in its | early stages. This case was related: | | https://www.thetaxadviser.com/issues/2018/sep/supreme- | court-... | Sebguer wrote: | Specifically on the SaaS front, taxability has been murky | and there's not a single standard across the US: | https://blog.taxjar.com/saas-sales-tax/ | treve wrote: | It's pretty weird hearing anyone talk about CGI parameters | these days, so perhaps that should also tell you something? | nickpp wrote: | That was 15-20 years ago, integration today has evolved, | of course... | oliverx0 wrote: | We are currently using ChargeBee that has great connectivity with | Stripe and offers a lot of the functionality that Stripe Tax is | now offering. Wondering if it is worth the change. I have nothing | but good things to say about ChargeBee so I don't think I will be | making the move unless pricing becomes an issue. They also have a | really good starting package for startups. | sireat wrote: | So how does one pay tax with this? | | Let's say you and your server are in Singapore. | | You are selling a digital product - PDF book on dynamically typed | Rust... | | You have customers from all 50 US states and all European | countries. | | You have 100k USD sales total. | | At the end of the year are you obliged to send the correct amount | of tax to EACH US state and each EU country? | jccooper wrote: | Yes, to the extent they require it (and you want to stay | compliant.) There are companies that can handle the remittance | for you; Stripe lists several on their page. Reporting | requirements would probably be quarterly or monthly. | | In practice, almost all US states that have sales tax have a | in-state sales threshold amount, usually $100k+ and/or 200 | transactions, and at the level of business as per your example, | you wouldn't hit it. (Kansas has no threshold, but this is | probably illegal per the terrible court decision that allowed | this sales-based nexus mess.) | | https://www.streamlinedsalestax.org/for-businesses/remote-se... | | EU, I dunno. Beyond my ken. | sireat wrote: | Thank you! | | A bit more clear, but still seems really messy. | | So if there are limits I assume you collect 150 transactions | a year from California, you have to keep the tax collected | until you reach 200 and send the tax for all 200? | | Presumably you can't spend the money on beer and yet you also | can't refund the customers either. | adamfeldman wrote: | This looks great. Implementing Avalara for tax calculation was a | large pain across multiple dimensions. | | Stripe Tax integrates with TaxJar for automatic US tax filing | [1]. I wish TaxJar had clearer pricing [2], as 12 filings a year | is tiny. | | [1]: https://www.taxjar.com/pricing/ [2]: | https://stripe.com/docs/tax/reports | toast42 wrote: | https://stripe.com/newsroom/news/taxjar | adamfeldman wrote: | Stripe acquired TaxJar ~45 days ago - that's awesome | devops000 wrote: | The next great step would be to manage Tax collecting from Stripe | Customer Portal. In this wet a website could redirect the user | directly to stripe to fill all information for invoicing instead | of saving locally, validating and sent them to stripe | ldd wrote: | 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 be hard to answer (I think you have | to pay taxes from day 1 even if you sell 50 euro per year?) | | Anyways, I am glad stripe is adding this product, and I've signed | up to join, but I am still wondering how complicated and | expensive the whole process of registration for vat OSS was. I | doubt I'd get more than 50 euro total per year in sales (yes, I | mean 50 euro. not kidding). | imhoguy wrote: | 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... | ldd wrote: | First time I hear about Paddle. It seems great! Thanks for | the recommendation :D | Ndymium wrote: | I have a nano sized business to cover some server costs in | Finland. Here are the EU rules as I understand them: | | * Selling goods - If selling to private persons | in European Union fiscal territory (EUFT), add 24% (Finnish VAT). | - If selling to businesses in EUFT, no VAT. - If | selling to anyone outside EUFT, no VAT, but you may be liable to | collect and pay VAT to the customer's country's tax authorities. | - Note that there are separate customs rules! | | * Selling electronic services - If selling to | private persons in EUFT, you need to register to the customer's | country's tax authorities and add the customer's country's VAT, | and then pay it later to the customer's country's tax | authorities. EXCEPT if you only have an office in one country and | you are selling to another EUFT country, and you only sell <= | 10,000 EUR worth of services, then you can use your own country's | VAT like normal. o Or you can register to so called | VAT MOSS (Value Added Tax Mini One Stop Shop) where you use the | customer's country's VAT but you don't need to register or pay to | their tax authorities, instead you send a quarterly report to | your own country's tax authorities about all the sales you have | done, then you pay them a calculated sum, and they will divide | the paid VAT to all the countries based on the sales. Of course | there is now a new VAT OSS that is somehow different from MOSS. | - If selling to businesses in EUFT, use reverse VAT (buyer is | liable for VAT). - If selling to anyone outside EUFT, | no VAT, but you may be liable to collect and pay VAT to the | customer's country's tax authorities. | | Now I'm not a tax lawyer, so this is all just my best | understanding based on our tax authority's website. I just wanted | to get some money back to pay for my ~20 EUR/mo server costs, and | I had to learn all of this. I will be very interested in what | this Stripe Tax can do to remove my headaches. :) Of course, | since my revenue is so tiny (and thus the money I bring to | Stripe), I can't access all of their services AFAIK. And I'm | mostly one chargeback away from losing major revenue due to the | 15 EUR penalty. :D | | EDIT: Turns out I have no idea how to format lists on HN. | alibarber wrote: | I understand that from the 1st of July, the electronic services | section will expand to all goods, potentially with some | thresholds, so you should charge the VAT rate for that | particular item at the customer's home country and submit that | to the Finnish tax authority (under the OSS scheme). | exhilaration wrote: | These are the thresholds for VAT going into effect on July | 1st: | | IOSS (EU) <150 EUR | | VOEC (Norway) <3000 NOK | | HMRC (United Kingdom) <135 GBP | scoot wrote: | Good summary. It's easy enough for EU VAT/MOSS, but this is the | killer right here: | | > you may be liable to collect and pay VAT to the customer's | country's tax authorities | ArkanExplorer wrote: | You don't need to charge VAT unless you hit these thresholds: | | https://www.avalara.com/vatlive/en/eu-vat-rules/distance-sel... | | Which at the lowest end is EUR 35,000 per country. | | Countries like the UK for example have a VAT threshold of | PS85,000 for businesses located inside that country. | | This is one of the problems of online marketplaces - they have | VAT added to them, even when the individual (small) business | doesn't need to pay it. | | VAT is a big compliance burden for small businesses which is | why every country has revenue thresholds under which you don't | need to charge it. | Silhouette wrote: | Unfortunately, almost everything you're talking about there | is about selling physical goods. The rules for electronic | sales have been completely different for quite a few years | now and are a labyrinthine mess that makes even professional | accountants frustrated and national tax authorities screw up | the most basic processes. In most cases, they also don't have | any minimum thresholds at all, and the few concessions that | have been made are quite recent. | kmoriarty wrote: | I just wanted to mention, our invite-only starts today, but | we're working on making Stripe Tax available to all very very | soon! | | Either way, we will be reviewing and onboarding users as | quickly as possible after you submit your interest! | rorykoehler wrote: | How long is soon? I'm asking as I'm in the middle of building | a saas. I might get to payments functionality in about 2-3 | weeks if all goes well. Should I wait or register interest? | kmoriarty wrote: | Shoot me an email with your account ID and I'll make sure | you're enabled by the weekend! kmoriarty@stripe.com | 42droids wrote: | That's what I call good customer service. :) | sdevonoes wrote: | > - If selling to anyone outside EUFT, no VAT, but you may be | liable to collect and pay VAT to the customer's country's tax | authorities. | | I thought selling to businesses outside EUFT was the same as | selling to businesses inside the EUTF. | Ndymium wrote: | Well I guess it would depend on the target country's specific | tax laws. | jerrre wrote: | There are also a lot of thresholds that might apply to your | situation. More rules to look up, but could simplify it to | having less administration if your revenue is under a couple | K's | kmoriarty wrote: | Good point! And with Stripe Tax we'll monitor how close you | are to those thresholds too, so you'll know when and where | you need to register as your business grows or sells into new | markets. | cecida wrote: | One of the things I love about Stripe is how much information | they give you on the landing page for the product. Code snippets, | examples, clear explanations about what the product does; links | to developer documents etc. | legitster wrote: | 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. | foobarbazetc wrote: | Every new Stripe feature is like "only 0.5% of your transactions" | until you're paying 10% to Stripe. Woo, where do I sign up? | Vespasian wrote: | Do they offer a way to set a final price including taxes? | | In many jurisdictions your advertised price (e.g. for German | users on your german page) needs to include taxes. | kmoriarty wrote: | Absolutely we do! https://stripe.com/docs/tax/products-prices- | tax-codes-tax-be... | nybble41 wrote: | How does that work when the amount of the tax depends on the | location? Do your visitors need to enter their billing & | shipping information before they can browse your site? | Vespasian wrote: | Either that (see the jetbrains store as a random example) or | other indicators such as language, tld-domain, ip origin, | advertisement targets etc. | | Of course offering one price for everyone is fine as well. | | These rules are usually B2C only. For B2B either way is fine. | | (I'm definitely no tax expert. Do you own research if | needed;) ) | scraptor wrote: | Generally there's a dropdown to select your country, often | next to or integrated into the language and currency | selection | Cu3PO42 wrote: | VAT is uniform across all of Germany. Therefore detailed | location information isn't necessary. The country can be | inferred reasonably accurately from the IP. You can have a | drop-down somewhere to correct the country if necessary. | | ~~And I don't think there's a law that requires you to show | the price including tax, but it's definitely expected.~~ I | have been corrected: it is indeed required. | nybble41 wrote: | > The country can be inferred reasonably accurately from | the IP. | | That would be a guess at best. A VPN or caching service (or | merely inaccurate geo-IP data) could cause the site to | infer the wrong location. The law linked by Vespasian | doesn't appear to make any allowance for cases where the | tax jurisdiction may be uncertain, though it's possible | that the automated translation I read glossed over some | nuance. | | > You can have a drop-down somewhere to correct the country | if necessary. | | If the visitor neglects to select their country, and the | default was incorrect, does that mean the site is not | compliant with the law? The requirement was simply to show | the final prices--no allowance was made, so far as I could | tell, for being given inaccurate information. | Vespasian wrote: | This law is an old one and has been in effect forever | (offline and online). I'm certain there is a lot of legal | practice and precedence on what can be expected of a | "reasonable" company. Courts are usually quite pragmatic | in their rulings (otherwise no law would ever work) | | The Goal is to prevent misleading advertising and | tricking of the customer by showing them a different | price. | | A typical costumer won't use a VPN etc, so if you can | demonstrate that you had a sufficient amount of evidence | no court will punish you for it. | | E.g.: German IP, German browser, a German credit card and | a German shipping address are probably sufficient. | | Edit: it used to be that you have to go to great lengths | to ensure that no consumer can shop in your B2B shop | (like verifying their business license, making sure the | customer isn't lying etc). In recent years the federal | high court ruled on several occasions that this is not | necessary and a simple disclaimer and a checkbox is | enough in most cases (IANAL). | Vespasian wrote: | For B2C it is mandated by law[1] SS1 (1) and (2) | | [1]https://www.gesetze-im- | internet.de/pangv/BJNR105800985.html | Cu3PO42 wrote: | So it is. I did a cursory search, but didn't come across | that law. I edited my comment to reflect this. | Symbiote wrote: | There are strange cases (e.g. I'm on holiday in Germany using | hotel wifi, ordering from a German webshop for delivery to | Sweden using a Danish credit card). | | In that case, the price will change when the delivery/payment | details are entered. | opheliate wrote: | Ah man, I'm so glad this exists. One of my biggest concerns in | monetising side-projects has always been running afoul of sales | tax law, and this should hopefully help to assuage some of those | concerns. | xyst wrote: | never used stripe, but I do like their design choices. | | Also given how extensive their APIs are and even offer in-person | payments via a physical terminal, why would one choose Stripe | over Square? I am guessing these products mean the % transaction | cost is slightly more than what is offered by other payment | companies (chase, square, boa)? | | Almost seems like a no brainer to choose stripe if you want to | scale your small business. | tjpnz wrote: | Side question but what solutions exist for managing withholding? | That presents a huge barrier to entry for certain business | models, even more so when you have users living in multiple tax | jurisdictions. | kmoriarty wrote: | Hey! We haven't tackled tax withholding yet. That said, I'd | love to learn more about your use case and requirements if | you're up for it: kmoriarty@stripe.com | throwaway368392 wrote: | Does that mean a small US-based B2B SaaS with no EU nexus have to | pay EU VAT? It seems overreaching. | andylynch wrote: | 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. | Silhouette wrote: | Are you sure this still applies in the case of purely digital | sales like SaaS, and for businesses selling into an EU | country but based outside rather than domestic businesses | selling within their own country? | tehnicaorg wrote: | I have not idea about VAT (except paying for it), but as I've | understood from a previously posted link this is not valid | anymore starting July 2021. | | https://www.avalara.com/vatlive/en/vat-news/eu-2021-one- | stop... | | _> At the heart of the 2021 e-commerce EU VAT reboot is the | introduction of the One-Stop-Shop ('OSS') single EU VAT | return and the withdrawal of the Distance Selling thresholds. | [...] Non-EU sellers may also apply to use the OSS regime, | and just need to nominate any single EU state to register and | file in._ | vfc1 wrote: | So they will charge 0.5% of my business to do my taxes? That | makes sense until 350k per year more or less, but after that | Quaderno has a 45 to 99 usd per month fixed price to do that. | | It sounded outrageous the first time I saw it, but it actually | makes a lot of sense for most small businesses. | | I'm glad they rolled out this feature, too bad that they never | announce what they are working on and it's a big bang overnight. | | I was looking into integrating my app with a tax provider, I | wouldn't even have started if I knew this was in the pipeline. | | But now that it's here, it sounds great and just another reason | for choosing Stripe. I haven't integrated with Paypal and I don't | think I'm going to. | Naga wrote: | 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 save the ongoing fee. You will have to | pay an accountant anyways to do your tax returns. I'm an | accountant and my firm often does sales tax returns for our | clients. Now, if you're making $1 million a year, that's $40k you | need to pay Stripe for the privilege of not worrying about sales | tax, compared to a few thousand you'll pay your accounting firm | to do it. | | The API and integration options are great and I hope Stripe is | successful. Really, if they are, it means I can just charge more | for my services. | | Edit: As others have pointed out, I'm bad at math. I'm going to | leave my shame up here but I realize it's $400, not $4000. Just | goes to show you that accountants are just like regular people, | and that you shouldn't rely on your accountant doing things off | the top of their head not using Excel. The order of magnitude | difference really shifts my opinion of it. | jnsie wrote: | > I'm going to leave my shame up here but I realize it's $400, | not $4000. Just goes to show you that accountants are just like | regular people, and that you shouldn't rely on your accountant | doing things off the top of their head not using Excel. The | order of magnitude difference really shifts my opinion of it. | | Fair play to you! | wly_cdgr wrote: | The replit guy needs to study your post so he can learn how to | handle mistakes the right way | weehoo wrote: | What happened with the replit guy? | wly_cdgr wrote: | replit guy strutted out his hardscrabble kid from Jordan | sob myth while "apologizing" | ayewo wrote: | From 2 days ago: | https://news.ycombinator.com/item?id=27428400 | snemvalts wrote: | Please double check your math before doing a hot take | paragraph. | tehwebguy wrote: | I think it would be $400? | hmoy wrote: | $4k? Isn't $0.4k as it's 0.4%? | adwww wrote: | Bad look for an accountant! | rapfaria wrote: | So the accountant should be charging less (or stripe more) | invisible wrote: | I'm not sure if I'm missing your comparison, but an accountant | doesn't calculate how much/which tax should be paid in real- | time based on the business and the user's location and then | automatically account for that. | | I don't know how much it's worth, but properly supporting tax | takes a lot of effort to do correctly in real-time. | jerrre wrote: | Your accountant is not going to build a system for you that | verifies VAT IDs and can automatically calculate the tax % on | check out I think? | maccard wrote: | > If you invoice $100k in a year, you're paying $4000 to Stripe | to manage your sales tax. | | The pricing on the page says 0.4% - that's $400/year not $4,000 | | > Now, if you're making $1 million a year, that's $40k It's | $4,000 by the above. | | > compared to a few thousand you'll pay your accounting firm to | do it. | | It's not _just_ the money you pay the accountant to do it once, | you need to get all of the data about where the customer is | purchasing from to your accountant in a format they can use. | Also, depending on your accountant, international sales tax is | unlikely to be their forte - they might handle different | states, but can they handle the varying rules in EU countries? | Naga wrote: | Yeah, you're right, my coffee hasn't kicked in yet. | | For the amount I thought you would pay for Stripe to do that, | you could have hired an accountant to figure all of that out | for you on an ongoing basis, but for the _actual_ price that | 's a pretty good deal to not have to think about it. | | My opinion on accounting services has always been that it's | nothing that a business owner can't do themselves since it's | not really that complicated, but it's never worth the time | when you can pay someone who already knows what they're | doing. Stripe Tax falls into that category for me too, it's | cheap enough that it makes it not worth it to do it yourself. | mgkimsal wrote: | > you could have hired an accountant to figure all of that | out for you on an ongoing basis, but for the actual price | that's a pretty good deal to not have to think about it. | | Even if you have accountants on tap, they may disagree. I | did some work on a project where we were needing to deal | with tax calculations (was using taxjar). At least one of | the questions was about when we should be charging tax on | certain 'extras', like... shipping. Their accounting firm | said "no, you don't charge tax on shipping". Taxjar was | automatically making that charge, and throwing off the | expected numbers. After some digging, I found, at least in | their primary state, they _should_ have been collecting tax | on shipping, but I don 't _think_ it was uniform across all | the other states. | | So... they had an accounting/books person on staff, and | this question went up to their 'tax person'. I think it was | either a general attorney or a tax specialist or something | - this was their 'oracle/decision maker', and they were | just flat out wrong. | | This probably _wasn 't_ the case 20 years ago, when they | were putting all their records in to an electronic system | the first time, but... rules change. Keeping up with them | is not a trivial thing, and when millions of dollars are on | the line... you can make expensive mistakes. | kilbuz wrote: | Obligatory Office Space -- | https://www.youtube.com/watch?v=3fGHaVn5rGo | vvoyer wrote: | 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 that's still cheaper than having your accountant going | through all your Stripe documents, computing taxes while also, | on your side, having to make sure you're 100% tax compliant. | Maybe at $10,000,000 it will start being a bit pricey, but at | that point you'll most probably discuss with Stripe to reduce | that fee. | GordonS wrote: | 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 registration numbers. | Now, the EU API for this is pretty crappy, and has a | ridiculously low rate limit - but still, it's not difficult | to do. Indeed, I did it in a few hours when I was setting up | Stripe for a B2B micro-ISV one or two years ago. I actually | think that VAT ID validation should be included as standard - | not chargeable. | vvoyer wrote: | 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!) | edwinwee wrote: | Yep, that's correct! Tax ID validation is included with | Checkout (outside of Stripe Tax pricing). | GordonS wrote: | > Hey there, I believe validating VAT numbers is outside | of the Stripe tax pricing and part of the Customer Tax | IDs API | | Ah, good to know! It was mentioned in the same TFA, so I | had thought it was chargeable with the rest of it. | | > But that's actually not so common, people signing up | for products usually have no idea what the VAT number of | their company is. | | Hmm, that hasn't been my experience, on either side of | the table. As a biz owner, I get plenty orders from | companies big and small, and always get a VAT ID through. | When purchasing (on occasion) in my previous day job, I | just had to ask someone in accounts what it was. | [deleted] | tnorthcutt wrote: | 1. Kudos for handling your mistake gracefully. | | 2. As of this writing, almost everyone responding to you is | using 0.4% as the pricing, when their page shows it's actually | 0.5% for the scenario you described ($100k in a year). The | lower rate only kicks in if you process over $100k in a | _month_. | | Unless they've changed their pricing details in the last hour, | that's another great reason to let them handle this! Clearly | we, collectively, don't have the attention to detail required | for this ;) | tegansnyder wrote: | Random aside on marketplace tax and using Stripe Connect. It | would be especially useful if Stripe had a field that allowed | marketplace facilitators to ensure they are collecting the tax. | Using connected accounts with destination charges allows platform | account to receive the tax by placing it in the application fee | field, but if you happen to also collect a commission that means | you are combining your tax + commission and storing that value in | the application fee field. Since marketplace facilitators are | responsible for tax collection in the US having an extra field to | put this tax in would be great. | tegansnyder wrote: | Piggybacking off this... Has anyone built a really good tax | exemption system. I know Amazon has a pretty decent system for | their B2B that allows you to upload a tax exemption certificate | for your state (US). Then they have some sort of auto | validation process. I assume it calls out to each state's | secretary of state system to determine the validity. I would be | interested to know if anyone has seen a SASS service like this | that other B2B providers can leverage for fully automatic tax | exemption validation. | edwinwee wrote: | Good idea! | andred14 wrote: | All this talk about tax lately is funny. | | Our leaders sense we have had enough of their robbery and we | have. | | I DO NOT CONSENT to my hard earned money being spent on | experimental drugs | joelbondurant wrote: | Taxes are theft. | codehawke wrote: | I've been using Stripe for years for my website, codehawke.com. | Once you get over a certain amount of revenue and or sales | transactions, they file 1099-K directly with the US IRS, they | won't miss your failure to report that. I'm not sure if this is | new, or I reached some new threshold? They are definitely in | communication with the IRS at this point. PayPal does the same | thing. | HatchedLake721 wrote: | Do you sell to US only or globally? Each country has its own | tax rules. | | E.g. if you sell to EU customers, you need to apply a correct | VAT % of their country on top. If you reach a certain threshold | you then need to file VAT returns. | codehawke wrote: | I do account for that, but honestly I don't make the | international sales to worry about it. UK is the one | exception for that. The rules are being a bit more simplified | starting July 1 of this year. VAT is a disaster for all | businesses. This is a case of going after the big guys and | screwing the little guys in the process. Luckily, 70% of my | revenue is in the USA and on top of that my company is based | in business friendly Virginia. | evangow wrote: | I'm not seeing anything here about generating VAT-compliant | invoices here or in the documentation. | | Different countries have different requirements for what must be | included on the invoice and specific language to use (e.g. how a | reverse-charge is supposed to be worded). | | There's a great overview on this here: | https://github.com/wbond/vat_moss-python/blob/master/overvie... | edwinwee wrote: | If you're looking to invoice a customer, Stripe Invoicing is | VAT-compliant. It allows you to customize your invoices | according to your customers' jurisdiction requirements (like | sequential numbering): | https://stripe.com/docs/invoicing/customize. We're also working | on providing VAT invoices after a payment too. Give us a poke | if you have any questions. edwin@stripe.com | pier25 wrote: | I was wondering this too. | | Different countries have different invoicing requirements. | | This may not be obvious for people from the US since invoicing | there is super easy. | jitbit wrote: | 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 :( | HatchedLake721 wrote: | What's the other solution? Stripe to become merchant of record | like Paddle.com? | dbbk wrote: | I really hate the Paddle UI but this is the sole reason I'm | with them. As a solo entrepreneur the peace of mind is just | too good. | | If Stripe added a Merchant of Record service, as an optional | extra, it would be game over and they would win this space. | jitbit wrote: | Yep, operating as a "reseller" paper-wise. We currently use | FastSpring for that | fighterpilot wrote: | Who's your current payment provider? | kmoriarty wrote: | 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 first two | out of the box today, and with TaxJar we'll be able to bring | filing and remittance as a native part of our offering. | bberenberg wrote: | 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. | Existenceblinks wrote: | All Indie developers or 1-3 person team need is a Merchant of | Record, or simply a SaaS app store without index page like | Apple Store. I don't even want to have a /billings page. Please | also provide full feature customer portal (refund / cancel / | pause / coupon / etc.) | | And I want that store to have only literally "one" page for API | documentation. All I want to check on my app is | `authorized?(user.subscription)` | NelsonMinar wrote: | In 2010 Amazon still didn't charge US state sales tax. They | claimed it'd be too hard to do it. | https://www.cbpp.org/research/amazons-arguments-against-coll... | [deleted] | adithyasrin wrote: | Really excited for this, hopefully Stripe brings out being a | merchant of record soon too! | troelsSteegin wrote: | I had to look up "merchant of record" [0]. I think the | implication of Merchant of Record platform-wide would be that | Stripe would own the customer-vendor relationship, and that | Stripe would become something like Amazon Marketplace. I agree | that as a "feature" MOR has a market, but I would see risk for | Stripe as being seen as a competitor to its customrs, vs as a | processor for them. | | [0] | https://www.venable.com/insights/publications/2019/05/will-t... | codehawke wrote: | So if this product does not file VATS in 50+ countries (seems | impossible anyways) and it does not actually pay these fees. This | product is solving a solution that no online retailer should even | bother with. | | Honestly, until congress fixes interstate commerce and that | terrible Wayfair decision, until the VAT process is drastically | simplified/unified, nobody should collect or pay these fees to | anyone. When they come for it, sue. | | The bottom line is this maddening confusion isn't worth dealing | with for the business or the state/country. | rriepe wrote: | Taxes are bad. Governments absorb wealth. They don't create | wealth. No government has ever created wealth. | dang wrote: | Please don't take HN threads on generic ideological tangents. | They're repetitive and usually turn nasty. | | https://hn.algolia.com/?dateRange=all&page=0&prefix=true&sor... | | https://news.ycombinator.com/newsguidelines.html | | We detached this subthread from | https://news.ycombinator.com/item?id=27461853. | rriepe wrote: | Can you please ban me? I don't want to be part of this | community any more. I appreciate you (you! specifically) | holding this place together but it's become one of the most | toxic places on the internet for anti-Christian, anti- | American and anti-conservative sentiment. | jjeaff wrote: | Governments don't save, they spend everything they earn and | then some. Where exactly do you think all the tax money is | going? | rriepe wrote: | Governments save all the time in various ways but that's not | what I'm talking about when I say "absorb": https://en.wikipe | dia.org/wiki/Government_Pension_Fund_of_Nor... | | What they never do is "earn." You wouldn't use that verb for | money I took under threat of force or imprisonment, right? So | why would you use it here? Try "steal," "rob," or, if you're | feeling particularly generous, "take." | | As for where it's going: Into a hole in the ground? My | argument is that governments are inherently inefficient, not | that governments shouldn't exist. | | Government is emergent. It _has to exist_. If you see someone | having the "Should government exist?" debate they're | probably an anarchist in high school. Or an HNer, I guess. | It's not a serious intellectual discussion topic. Drop 10 | people off on a deserted island and they'll have a government | 30 minutes later. There's no "no government." | spoonjim wrote: | LOL. I wonder what kind of information diet one would have to | construct, and how long one would need to adhere to it, to get | oneself to a place where they sincerely believe this. | rriepe wrote: | It's usually just tax forms when you turn 18 | tomtheelder wrote: | And even if you somehow DID believe that governments never | create wealth, you'd need to have also convinced yourself | that they can do no good aside from wealth creation. Or | possibly that there IS no good aside from wealth creation. | | Regardless of what it is, it is a viewpoint totally divorced | from reality. | rriepe wrote: | I'm right here. I'm a human. You can e-mail me. I'm a | person! | SiempreViernes wrote: | No offence but "you can e-mail me" is not the most | persuasive argument for possessing personhood I've heard. | | Anyway, I don't think people doubt your humanity, just | your sincerity. | rriepe wrote: | You're a bigot. | yardstick wrote: | Didn't DARPA essentially create the Internet? Lot of wealth has | been created here thanks to them. | adamc wrote: | If you compare the results of having a government to chaos, | they create a LOT of wealth. | rriepe wrote: | Chaos is just a government that absorbs more wealth. | skrtskrt wrote: | Not to mention 99% of all medical advancement derives from | government-funded research | codehawke wrote: | It's quite obvious both PayPal and Stripe need to account for | these terribly burdensome tax laws going into effect next month. | The thresholds for most companies (UK excluded) was previously | enough for most international sellers to not have to worry about | filing for a VAT in multiple foreign countries. However, now they | are making it even more burdensome by removing these thresholds | entirely. No USA businesses selling small amounts of good are | going to deal with that burden. If PayPal and Stripe can't | deliver, that VAT ain't being paid by the majority of online | shops. This is a case of them trying to go after the big guys and | screwing the small. Good job on Stripe. PayPal needs to do the | same. https://www.avalara.com/vatlive/en/vat-news/eu-2021-one- | stop... | AnssiH wrote: | The only EU threshold change affecting US businesses sending | goods directly to EU customers is the removal of the 22 EUR low | value consignment relief. | | Regardless of sales volume, such businesses were not obliged to | file VAT in EU before and will not be after the changes either | - they will now be able to file IOSS VAT returns if they wish, | though. | | The annual thresholds the linked article talks about are all | concerning intra-EU cross-border sales, not imports. | plantain wrote: | This is going to be a sad day for Octobat | (https://www.octobat.com/) which I've been using happily to | automate this for the last few years. | | Octobat may still be cheaper depending on your transaction | volume. | kumarski wrote: | The VAT taxes are coming for all of us. | | Good move on Stripe's part. | lbearl wrote: | From the docs (https://stripe.com/docs/tax/checkout) it looks | like Apple/Google Pay is disabled when Tax is enabled. I wonder | if there is a technical limitation there or if that is something | that will be supported soon? | jackerman wrote: | Confirmed this is a technical limitation that we're working on | as swiftly as possible. Drop me a note at jackerman@stripe.com | and I'll let you know as soon as we've resolved this | limitation! | admissionsguy wrote: | Very happy to see this, it is such a necessary feature. I was | recently looking for an option to enable VAT calculation in | Stripe and couldn't believe it wasn't there. Now it is, and it | looks very well done as Stripe's features usually are. | | But 0.5% fee per transaction is.. steep. | kmoriarty wrote: | Thanks for the feedback! Completely understand your reaction to | pricing. For a bit of context, we've spent the past year | listening to users and trying to understand the best way to | price. In finalizing our launch pricing, we made sure there are | no fixed upfront costs or contracts, nor are there any per | transaction fixed fees either. We tried to find a price point | that ultimately was not prohibitive for small businesses but | also portrayed the value of the product itself. Please do keep | the feedback coming, we're always open to hearing more from | users: kmoriarty@stripe.com | [deleted] | mchusma wrote: | My honest feedback on pricing was "expensive but we would | only want to apply it on non-US users." Also, we wouldn't | want to have to pay for invoicing, which is honestly much | much worse of a value prop. For someone with a 20% margin | business, the combination of these and payments products is | about 4%, or 20% of all profit. | | While this is the first product since payments I have liked | (so good work there) it would be nice to see Stripe work on | reducing the transaction costs, particularly on the payments | side. Right now for me I consider Stripe a part of the | "credit card processing tax cabal". Payment processing fees | are a huge tax on the world, and if stripe could help solve | that and genuinely reduce it to the level it should be | (nearly free marginally), I would have the utmost respect for | them. I honestly think this should be the main company focus | if they actually want to help customers. | cashewchoo wrote: | It's worth noting that there's the interchange fees that | come along with using a credit card in the US aren't just a | pure profit rake for the credit card companies. | | It obviously pays for computing resources and staffing and | such, but beyond that it also, roughly, pays for all the | fraud that happens with any credit card. In many cases, | when someone does a fraud, it's someone "in the middle" | (i.e. not the fraudster, the card holder, or the merchant) | who ends up holding the bag. | | It's also paying for some aggregate amount of credit risk | that card users pose to their banks. | | Credit card fees are high because fraud is such a colossal | problem, and at various levels it's better for institutions | to just eat costs (and thus slightly raise the minimum | viable price they can charge for processing) than make it | harder for people to buy things. | manigandham wrote: | > " _nor are there any per transaction fixed fees either_ " | | Why not? Wouldn't fixed fees be preferable to a relative | basis for something like this? | cashewchoo wrote: | It punishes smaller transactions unfairly, which doesn't | make a lot of sense since the size of the dollar amount | probably doesn't have anything to do with the incremental | cost to stripe to compute the tax bill. | [deleted] | chinathrow wrote: | Yes, the 0.5% adds up. 0.5% for Billing, 2.9% + 30c per | transaction, more if you add e.g. fraud for teams etc. | | Stripe is great and I use it too, but the way they charge you | (a percentage of your revenue) is simply not that fair in the | long run while their workload has a fixed cost per transaction. | ttoinou wrote: | Seems very fair pricing compared to competitors | drexlspivey wrote: | Why does it have to be a percentage of your revenue? It's | doing exactly the same thing for a $100 invoice and a | $10000 invoice, why does the latter cost 100x more? | duckmysick wrote: | Value. A service Y makes it easier to collect that $10000 | invoice. Inversely, by not using a service Y, you might | not see those $10000 or it will be more difficult to do | so. | | A glass of water has more value to you when you're | thirsty. | edwinwee wrote: | Yep, Stripe prices its products pretty competitively and | talks to many beta testers before we settle on pricing. I | think even adding all this up, it's less expensive than | merchant of record providers like Paddle. | hardwaresofton wrote: | Welcome to the world of saavy SaaS businesses. | Smart/enterprising SaaS founders and businesses these days | all know to tie their billing to whatever metric/KPI they are | solving for customers -- per-seat billing, per-pageview, etc. | | Why make a little money (even if it's 2-10x your cost) when | you can make much more by taking a small-seeming percentage | of every single <whatever> that comes through your business. | When your customer wins (and when they aren't winning you | aren't a huge strain on their wallets) you win, and if the | 0-5% eaten up by their bundle of SaaS products never matters | to them, then you get wildly rich doing it and no one is | angry about it, since the incentives are aligned. Then you | plow that extra revenue (that you wouldn't have gotten from | the simple 2x-10x your cost) into expanding your service | offering so you deliver so much value (or perceived value) | that moving away from your service just doesn't make sense. | | This is HN and just about everyone and their mother knows | this at this point, and has been living it for longer than | I've been writing computers but I'll say it anyway -- Stripe | is the dream SaaS company, essentially a financial middleman | that no one hates (yet?). The SaaS promised land is a | somewhat close cousin of the dystopian everyone-is-a-renter- | and-only-a-few-own-the-capital future. Maybe the hand | wringing I'm doing is wrong -- maybe it _should_ have been | the case all along that solution providers should have | extracted a never ending royalty on the revenue generated by | the solutions they provide. Not only service providers but | maybe workers should want that (no one remembers pensions, | but they kind of were this) too. Who knows. | | If you can sell a music single album to 0.3% of America for | $1, you get $1MM. If you do that with a Stripe store, Stripe | gets ~$30k, for infrastructure that probably cost them less | than $300 to host (for a single customer) and an ever- | decreasing amortized amount to build (assuming they | eventually stop growing their development workforce for | growth stake). The artist that just made $1MM probably | doesn't care about $30k as a millionaire (maybe they should, | maybe they shouldn't). | | It's a win-win, and it's why Stripe's goal is to increase the | GDP of the internet. | justsomeuser wrote: | Apparently Buffet calls this a "toll booth" business. | | Once the road is built (customer integrates Stripe into | their state machine), you can just keep collecting their | toll for driving on the Stripe highway. | cashewchoo wrote: | The thing is, if you didn't integrate Stripe, you'd | either be: | | 1. integrating someone else who does roughly the same | thing as Stripe 2. integrating with _and_ maintaining 100 | 's of individual payment methods and countries, and | dealing with tons of entities and managing relationships | with them. | | You might be able to cheat if you just do visa cards and | only in the US, or something. But that is dramatically | less than what you're getting when you integrate Stripe. | justsomeuser wrote: | I agree, Stripe is good, and probably is worth it - you | will be paying someone do handle card processing after | all. | | But if they wanted to, they could hike prices tomorrow - | same with any other alternatives. | hardwaresofton wrote: | Middlemen all the way down. At this point I think the | question is when does the fatigue start? Maybe it never | does -- if 10 companies all take 0.5%, you're at 5% but | what if you use them to run 90% of the work of running | your actual business? For many businesses that would be | worth it (and most SaaS-ers and proper business people | would heartily agree). | | I'm about to go off on a wild tangent here but I think | this is the obvious endgame for autonomous vehicles | (article from Ars Technical on this hit HN just | today[0]). More narrative for that world where no one | owns anything and everyone rents forever and if you | didn't own capital by 2100 your chance to do so is now | infinitesimal. Safety of autonomous cars will surpass | human driving, human driving will be outlawed, and the | toll booth behavior will kick in with either companies | licensing self driving technology, or the cars, or just | running the services. Yeah, you never pay the $1-2k to | buy a beat up first car (that could have lasted you 5 | years with careful care and proper maintenance), but | you're stuck on the $8.50/day ($2040/year if you commute | to work 240 days/year), forever. | | Another wilder tangent (possibly too much of a | distraction from the topic at hand) -- this future is one | of the reasons I am skeptical of UBI. UBI feels like the | fastest way to encourage _every_ kind of company to take | this route. If you know every citizen will get $1k | /month, the monopoly-dominated markets will fight | (initially, at least) to get their share of that | guaranteed $1k, almost as a form of governmental graft. | Differentiated work pools get rarer and rarer (people | specialize up, but automation gets better, ad infinitum), | and at some point a large mass of people are getting UBI | + gig economy wages. The corporations who have carved | their part of the daily budget out never stop winning -- | they now don't need to worry about economic conditions | for their now-somewhat-more-distant gig worker force, the | government will step in to help citizens, and those | corporations can continue to influence those proceedings. | What breaks this cycle? Is the goal a utopian world where | $UBI is actually enough to free people of work | completely? That never seems to be the goal, or maybe I | just haven't seen enough people play out enough steps in | the UBI plan. I just know that when people doing really | well in the current capitalism-on-overdrive system start | to get behind something that really seems like a utopia | for those doing not-so-well in the current system, | there's a catch. | | [0]: https://arstechnica.com/cars/2021/06/volkswagen- | plans-to-off... | eps wrote: | Don't forget they also force-convert payout wires to your | native currency if you aren't in the US. Even if you operate | mostly in USD, have USD accounts, etc. | simonebrunozzi wrote: | This has a huge potential to disrupt and simplify a number of | things that happen behind the scenes. | fastball wrote: | 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. | kmoriarty wrote: | We shipped customer portal support a few weeks ago, apologies | for not following up and letting you know! If there were any | other issues though, do let me know -- kmoriarty@stripe.com | fastball wrote: | Hey! The issue we were having was related to customers being | unable to change their subscriptions through the Portal with | Tax enabled, which I just tested and still seems to not work. | I've sent you an email so hopefully we can figure this out. | andred14 wrote: | All this talk about tax lately is funny. | | Our "leaders" sense that we have had enough and we have. | | I DO NOT CONSENT to my hard earned money being spent on | unnecessary experimental drugs that hurt people or wars on | foreign people that have done NO harm to me. | jmuguy wrote: | Very excited about this, hoping to see hotel/rental taxes | supported. Trying to figure out how different areas tax rentals | is kind of a nightmare. Avalara offers this service but we | couldn't get past their sales team to actually use their product | kmoriarty wrote: | We're not there just yet, but feel free to shoot me | (kmoriarty@stripe.com) an email with any other tax related | requests or requirements, as this is just the beginning! | vvoyer wrote: | I was lucky to be part of the beta for my SaaS | (https://turnshift.app) and I must say this new feature | simplifies things A LOT. | | Especially as a EU business owner, I previously had to sync every | VAT tax rate possible, use a complex workflow to know if a | customer needed to pay taxes or not, link tax rates to customers, | and create taxes reports for my accountant. Stripe tax does all | of that automatically, based on the customer full address and VAT | numbers. | | Here's a twitter thread of everything you had to do previously: | https://twitter.com/vvoyer/status/1347488977738149888 | | PS: Yes there were other services (Paddle) providing this (and | much more to be honest), but the Stripe API and customization | options makes it my go-to solution for integrating payments. | pier25 wrote: | So what are the advantages of Paddle? | Silhouette wrote: | Most importantly, they become the merchant of record. In | other words, they're a separate legal entity reselling your | product to your end customer, and therefore they are the ones | who deal with almost all of the corresponding tax and legal | responsibilities. You then deal with them through a B2B | relationship, in which they give you you the collected | revenues minus their fees every now and then, and you provide | your product to the customers they've sold it to in return. | Your own accounts and tax responsibilities are dramatically | simplified as a result, though typically with a merchant of | record arrangement (with Paddle or any other) you trade that | off against some loss of control and higher fees. | usaphp wrote: | They support PayPal | [deleted] | devops000 wrote: | I think you still need to collect VAT ID on your website and | associate it to a stripe customer | edwinwee wrote: | Nope, no need! Tax ID is validated when you accept the | payment: https://stripe.com/docs/tax/checkout#create-session. | toomuchtodo wrote: | Do you feel like the value is worth with the fee Stripe is | charging? | yannoninator wrote: | 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. | scubakid wrote: | With this new Stripe solution, do you still have to | register for licenses to collect tax everywhere and remit | the sales tax to various US states and foreign governments? | Unless I misunderstand, that still sounds prohibitively | onerous for anyone working as a solo dev or very small | team.. | groundthrower wrote: | Also wondering about this. Having a one man band b2b only | saas, in EU. Have few customers in US to whom I just send | an invoice with no tax added. This is what I heard from | long ago was how you do. | | Have never registered any taxes abroad in any country. | For EU customers I collect VAT no and do the quarterly | report but for all other countries I've done nothing. I | have basically been doing this wrong then? | yarcob wrote: | As long as you are small enough, that's what everyone | does. Pay taxes in your own jurisdiction, ignore foreign | taxes. | | At some point you may reach a limit where you need to | file taxes in other places as well. | | But as a one man operation that sounds unlikely. | dstick wrote: | Not sure how it works in the US but in the EU you don't | have to register anything. Just keep tabs of what VAT you | collected for what country, and then pay accordingly | afterwards. No licenses needed. | scubakid wrote: | Last time I looked into this, it seemed to me like in the | US you would need a separate license for each state you | collect sales tax in (before collecting any tax)... and | naturally, each state has a different licensing process, | and some charge fees to register. For small independent | projects, it seemed like kind of a nightmare. | kevin_thibedeau wrote: | You don't have to collect tax for states you don't have a | presence in. They have no jurisdiction outside their | borders. | scubakid wrote: | I think due to South Dakota v. Wayfair, states now have | more power to define what constitutes "nexus"... so there | are all these special rules and thresholds now to keep | track of (different for every state) that define whether | you have economic nexus and need to collect sales tax | there. If you hit the threshold and/or other rules apply, | you're obligated to collect sales tax... but of course | you can't do this until you have secured a license in | that state. This was my read on the situation, but if I'm | missing something definitely let me know. | comex wrote: | That used to be the law, but is no longer as of 2018: | | https://en.wikipedia.org/wiki/South_Dakota_v._Wayfair,_In | c. | R0b0t1 wrote: | A bad ruling. To let it stand, the more reasonable | interpretation is that the purchaser has to remit sales | tax to their own state. But it may not stand on further | challenge. For example, why should the state the items | are leaving not be entitled to sales tax? | gamblor956 wrote: | The law already was that the purchaser should remit _use_ | tax to the state for purchasers from out-of-state | vendors. | | But compliance was basically non-existent; most people | didn't even know that they owed use tax on such sales, | much less what rate would apply. Sales tax is basically | use tax, but with the burden of compliance placed on the | seller. | | As for why the sellers' state is not entitled to sales | tax: in the old-time days, pre-Amazon, this was how many | (but not all) tax jurisdictions determined sales tax. | (For example, CO's sales tax regime pre-Wayfair used to | use the seller's address to determine tax rates.) But the | rise of Amazon and online sales meant that sales tax | would go to a few jurisdictions where the sellers were | located, rather than be spread out where the buyers were | located. As sales tax pays for things like roads, etc., | that these remote sellers used, many jurisdictions | thought this was unfair, and moved to change sales tax | sourcing to destination-based sourcing (i.e., to taxing | based on the customer's location). And in the Wayfair | decision, SCOTUS said this was acceptable. (At the | national and international level, destination-based | sourcing has been the law for decades, and has been part | of America's tax treaties dating back to at least the | 1970s.) | jxramos wrote: | I was just wondering about this. I recently purchased | something online, and when I got the email receipt it had | all the state and county and city level tax breakdown. I | thought to myself, was this tax being charged due to the | billing or shipping address? Apparently it was the | shipping address when I asked. | briandear wrote: | > But compliance was basically non-existent; most people | didn't even know that they owed use tax on such sales | | As a business owner, I would ask myself "how is this my | problem?" If a stare has a problem with residents not | complying with a tax, I am not sure why a business in | another state should care. If I buy a product from China, | are they required to collect sales taxes for Montana? Of | course not. So not sure why a business located in a | sovereign US state has any obligation to follow laws of | some other state in which they don't operate. It's the | purchaser that has the relationship with their local | state, not the seller. | | The Wayfair decision was ridiculous. The Quill decision | it overturned was the correct answer in terms of | interpreting the Interstate Commerce Clause. | Interestingly, Amazon and other large e-commerce | companies don't have a problem with collecting sales | taxes everywhere because their compliance costs are | trivial as a proportion of revenue. | R0b0t1 wrote: | This is my point. | | It happens with brick and mortar stores, too. The MO/KS | border has a large population buildup. It's totally | normal to shop in the state that has the best tax rate | for your goods. If you apply the ecommerce logic to this, | you need to have people show ID at stores so the store | can apply the right tax rate. | | It seems to me the seller's state has just as much claim | to sales tax as the buyer's. The seller is potentially | making use of business development credits etc, etc, | originating in their state. | | This is an issue that falls under the federal government. | gamblor956 wrote: | No, you guys are both misunderstanding how the sales | sourcing works: it's the address where the sale is deemed | to have taken place. | | For brick-and-mortar sales, that is the physical location | of the store: you will be taxed the appropriate rate for | the address of the store. Note that this includes | includes online orders picked up from a store location, | and in-person orders even if the goods are not actually | physically located at the store, such as if they are | shipped from a separate warehouse to the store. However, | delivery orders might be subject to different rules, | depending on the state; some states use the address | provided by the customer as the location of the sale, so | that in-person sales delivered to out-of-state addresses | might not be subject to sales tax. | | For online sales, the sale is (now) treated to have | occurred at the address provided by the buyer for | delivery, because that is the most expedient way to | determine address. The EU has made waves about using IP | addresses or geolocation to determine the actual location | of the buyer at the time the order is submitted, but | AFAIK both proposals are DOA due to infeasibility. | | _It seems to me the seller 's state has just as much | claim to sales tax as the buyer's. The seller is | potentially making use of business development credits | etc, etc, originating in their state._ | | No, the seller's state doesn't have a claim to the sales | tax, because sales tax is a tax on the _customer_ not the | seller. It is simply collected by the seller because the | compliance is easier to enforce. (Caveat: in Hawaii, the | GET is a tax on the seller that can be passed on to the | customer.) | codehawke wrote: | Luckily, my home state of Virginia has exclusions. From | what I understand, until congress acts, more lawsuits | need to happen from companies challenging states to pay | these bullshit taxes. VAT is also a terrible burden. | gamblor956 wrote: | The trend in courts and legislatures, both in the US and | in Europe and the ROW, is _toward_ customer-based tax | sourcing and _away_ from seller-based sourcing. | | You can thank Amazon for abusing seller-based sourcing | for this shift, though it has actually been a decades- | long process that began before most people on this forum | were born. Amazon simply accelerated the transition. | chrismorgan wrote: | How do they keep track of who you are? I presume you need | a VAT ID of some form? (From https://en.wikipedia.org/wik | i/VAT_identification_number#VAT_..., it looks like | they've crafted it so that many countries' business | numbers can be turned into VAT IDs painlessly, e.g. | Canada's work direct, Australia's you prefix with a two- | digit checksum. I note the conspicuous absence of the USA | from the list. I have no idea about US tax.) | kmoriarty wrote: | Good question! Today you would still need to register | yourself, however we tried to make this as easy as | possible in two ways: | | 1) We monitor your transaction and compare them to local | thresholds so you know where/when you may need to | register: https://stripe.com/docs/tax/set-up#monitoring- | your-obligatio... | | 2) We provide documentation/links to the exact sites to | register: https://stripe.com/docs/tax/registering#list- | of-state-and-co... | | In the future though we'd love to also offer | registrations on your behalf, this is just the beginning! | robertlagrant wrote: | This is a really useful toolkit. Going much further might | make you into the actual legal entity, which could have | consequences I don't fully understand (but is perhaps | Stripe's plan?) | throwokay wrote: | I thought Avalara was the leader in this space. What is | their pricing, I can't find it on the site. | Silhouette wrote: | _What is their pricing, I can 't find it on the site._ | | Whatever it is, reading reviews of Avalara suggests it's | beyond the level smaller businesses can afford and has | also been increasing dramatically from one year to the | next for some time. | | Avalara have a strong web presence because they've always | been good at presenting key information like current tax | rates and forthcoming changes. Their content marketing is | excellent. But as soon as you look for more details about | anything they offer, you seem to be straight into | "enterprise contact-us sales process" mode. | gamblor956 wrote: | Avalara is expensive. It works out to being cheaper if | you have sufficient scale, but it's generally pricier for | small businesses. | | However, that is because you're paying for their customer | support, and Avalara customer support is _very good._ | Every issue we 've had has been dealt with promptly, | including issues where Avalara misfiled a return. (Long | story short: they owned up to the mistake and corrected | it with the state without any additional cost or | penalties to us.) | [deleted] | Silhouette wrote: | Here's some current Stripe UK pricing, confirmed on their | site today. | | Baseline of 2.9% + PS0.20 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 | functionality. | | That is significantly over 5% for a typical SaaS or | merchant selling digital content online, making | international sales in multiple currencies. | | Given that merchant of record services like Paddle are | providing functionality far more comprehensive than Stripe | Tax appears to be, they're still going to be attractive for | smaller merchants compared to the more traditional PSPs | like Stripe. | | It's probably worth pointing out that while the EU has a | long track record of making VAT difficult for everyone, | plenty of other countries around the world and even some | smaller regions seem to be jumping on the bandwagon lately. | If all of these governments start attempting to enforce | their local laws extra-territorially (leaving aside any | questions about the legality and/or morality of doing so | for this discussion) without also introducing reasonable | _de minimis_ thresholds to avoid grossly disproportionate | compliance costs for negligible extra tax revenues in low | volume situations, the situation could get very messy. | | If that does happen and businesses are forced to comply | with all rules globally regardless of actual sales volumes, | I don't see how the model uses by traditional PSPs like | Stripe has any chance of surviving. Every small business | will have to sell via intermediaries like Paddle to shift | the tax responsibilities to a larger business with the | resources to deal with it, and pay whatever premium the | market decides that justifies on all affected international | sales. | gingerlime wrote: | Stripe also offers interchange plus pricing, but you'll | have to badger them for it... if you're selling in Europe | it can work out much cheaper, but it depends (eg amex | would cost you much more). | | Also the exchange rates can be avoided by setting up bank | accounts with different currencies (eg transferwise --- | now wise). This alone saved us a bundle. | realityking wrote: | I believe the currency conversion charge can be avoided | by only charging your customers in your own currency or | another currency you have a bank account for. I rarely | see a small merchant that takes more than one or at best | two currencies. | | That'd leave you with 20p + 3.9% (international) / 2.4% | (European). Compared to Paddle's 5% + $0.50 that could be | a good deal depending on how much of your volume happens | in Europe. | Silhouette wrote: | _I believe the currency conversion charge can be avoided | by only charging your customers in your own currency or | another currency you have a bank account for._ | | It can, but then your customers get hit with varying | exchange rates and potentially high conversion fees on | their side. This will not make you popular with your | international customers, at least the ones who didn't | already back out when they saw a foreign currency anyway. | Depending on which research you read, the rate of lost | conversions due to lack of local pricing could be as high | as 50%. | | Within the overall landscape of payment processing | options, Stripe looks trapped in an awkward middle ground | now. | | Above them are the merchants of record. Including | currency conversion, international sales using Paddle | seem to cost 7% + 35p at current USD/GBP exchange rate | and their standard published pricing. But for that, you | get real tax compliance. | | Then we have Stripe, coming in at 5.9% + 20p (4.4% + 20p | for European cards). Even with Stripe Tax, you're missing | much of the essential functionality for global tax | compliance and the reassuring liability shift, so that | extra 1.1% + 15p or even 2.6% + 15p would be the easiest | sale since bottled water in a desert to a lot of | merchants. | | Further down the price spectrum, we have services like | GoCardless that are offering direct payment schemes | rather than cards (duh) but for a fee of only 2% + 20p | _including_ currency conversion. You don 't get any | built-in tax support here, so it would be fairest to | compare with Stripe at 5.4% + 20p or possibly 3.9% + 20p, | but that's still quite a difference. And while you have | to do your own tax compliance as with all payment | processors using this model, you do get other benefits, | notably in much improved reliability of collecting | payments via direct payment schemes compared to card | payments. | | I wonder whether Stripe's medium-term goal might be to | establish its own merchant of record service, and Stripe | Tax in its current form is just the opening move. | Otherwise, it doesn't really make sense to me as a | strategy. But I have no inside knowledge on this and | there are several Stripe people around who probably do, | so no doubt if they want to elaborate at this time they | will. | realityking wrote: | I agree that the convinces of Paddle is hard to beat, | especially for sole developer and small companies. | Liability shift being indeed very powerful. But I also | think the percentages thrown around are too sinistic. If | you make ~5 figures a month in revenue it becomes very | doable to hold a Euro and USD bank account in addition to | your local currency, likely covering a fair amount of | your customer base. Suddenly your cost are significantly | lower (at the expense of now having to manage multiple | accounts) | sudhirj wrote: | 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. | Silhouette wrote: | If you're selling a B2C service (so the really horrible | tax rules apply) for say PS10/month, that extra PS0.20 is | another 2%. Stripe's total cut for an international sale | with currency conversion is then nearly 8%, even if you | don't use any of their other services with their own | extra costs and you never have any refund or chargeback | costs to amortize. | | Stripe is crazy expensive these days. | | (There are other parts in the fees charged by other | services as well, but those also aren't like for like | comparisons. I'm just saying that 5% as a baseline | wouldn't necessarily be that high compared to services | like Stripe.) | outcoldman wrote: | Do you know if Paddle files taxes for you? And just send | you 1099? Or it is similar to Stripe Tax, they just collect | and you have to file taxes? | pimterry wrote: | I use Paddle, they do file 99% of your taxes for you. | | In effect, they sell the product to customers, and handle | all the tax on that side, for every tax regime in the | world. | | Meanwhile you act as a company with a single B2B client | and one invoice a month (covering Paddle's net sales | minus 5%) instead of N invoices. They send you an email | every month with your 'reverse invoice'. As accountancy | goes it's extremely easy, but you do need to do the basic | tax filing in your local jurisdiction. | | That 5% includes all the processing fees, they also have | a bunch of useful subscription infrastructure, and they | handle customer support for billing issues, which tends | to be a substantial percentage of issues as you get | larger. | | So far they've been great, and doing nearly zero | accountancy is worth a lot of money to me as an indie dev | with a digital product (where you need to know a lot | about local digital taxes nowadays). That said, would I | do the same at the beginning if this existed a few years | ago? Hard to know, but this doesn't look so compelling | that I'm likely to switch now. | Silhouette wrote: | How do you find working with Paddle? They've been on our | shortlist for a new project and we've heard only positive | things from people who actually use them. However, their | terms could make any lawyer or company officer who | actually read them visibly wince, and so far that has | prevented us from engaging with them despite their clear | advantages over the traditional payment services. | pimterry wrote: | Are there some specific terms in their legal bits that | you're concerned about? | | Personally, they've mostly been very good. The product | works, it was very easy to set up and it does everything | out of the box, and it's made sales tax & accountancy | almost completely disappear. | | I have occasionally run into issues or bugs, and their | API is a bit of a mess, but nothing show stopping and | their team has been reasonably responsive and sorted | everything out very reliably. That's noticeably got | better & faster recently, I think they're beefed out | their support team a lot in the last year or so. | | If you're selling a new product as a substantial | business, I think they're good but there are other | options to look at too and there are tradeoffs (5% is | high, you could probably do your own customer accountancy | etc in house). | | If you're a solo dev/small indie, or just getting started | though I think it's a no-brainer. It's just so much | quicker & easier than doing everything yourself. | Silhouette wrote: | _Are there some specific terms in their legal bits that | you 're concerned about?_ | | Quite a few, but to give an example from high on the | list, it appears that a SaaS company would warrant that | software sold through Paddle is always bug-free, accept | unlimited liability via the related indemnification | requirements if it isn't, and yet have no right | participate in or even know about any relevant process if | something goes wrong. That's a toxic combination and | hardly looks like a healthy basis for a mutually | beneficial business relationship. | | Other concerns related to the considerable flexibility | Paddle appear to give themselves in terms of how they | represent, price and provide access to whatever is being | sold, again apparently without necessarily requiring the | consent or possibly even the knowledge of the underlying | provider. We're unclear about how much this might be | necessary because of merchant of record legal model, but | it has little to do with what we'd actually want to use | Paddle for or why we'd choose them over other services | for collecting payments. | | For context, this is a new business but run by a team who | have collectively founded multiple others before. Several | of us are very much over wasting time and effort on the | mechanics of taking money from our customers and | complying with whatever rules accompany that. Obviously | fees charged by a payment service do matter, but a | moderate difference there is still insignificant to us if | the service we use can offer enough flexibility for our | needs and easy integration, and otherwise takes on as | much of the mechanical implementation and regulatory | burden as we can shift. | nikon wrote: | Paddle is fundamentally different to Stripe. As you said | they a merchant of record. Your customers purchase via | Paddle, manage the subscription etc via them. Disputes | would be via them too. Something to bear in mind. | Silhouette wrote: | Sure, the model is different, but that still doesn't make | signing up to an impossible promise with unbounded | liability when you inevitably break it a good idea. | | What happens if Paddle are faced with a customer who is | getting snotty about a bug and threatening litigation in | an expensive jurisdiction? Paddle apparently have the | right under their terms to settle that dispute on | whatever terms they wish and then pass the entire cost on | to the developers. There doesn't appear to be anything | requiring those terms to be reasonable nor anything close | to what the developer themselves would have had to offer | in their own home jurisdiction or if they'd been selling | directly to the customer on reasonable terms. As far as | we could see, Paddle don't even have to notify the | developer that any of this is happening, they can just | send the bill at the end. | | If anyone from Paddle is reading this and would like to | explain publicly why that isn't an existential threat to | every SaaS business using their service and what their | terms actually mean, that would be very interesting to | read. Maybe something like the above scenario would never | actually happen. As I mentioned before, I've heard | nothing but positive comments about Paddle from various | people I know who actually use it. But in that case, | there's no need for such one-sided terms, and it's better | for everyone if the legal documents say what you really | mean instead. | hijodelsol wrote: | Paddle and FastSpring (I found their support to be more | helpful than Paddle's but they charge even higher fees), | the two solutions commonly used in that space, act as | Merchants of Record. Since you are not selling directly | to your users you don't have to file the corresponding | taxes, just the ones that correspond to the transactions | between Paddle/FastSpring and you. But I'm not an | accountant and they may change their operations in the | future so don't rely on this comment alone. | tonyedgecombe wrote: | That's the reason I use 2Checkout (formerly Avangate). I | can issue one invoice a month, in my own currency. That | saves a lot of work and aggravation. | pier25 wrote: | What about invoicing to the customer? | | AFAIK Paddle solves that too but Stripe doesn't. | revorad wrote: | I was part of the beta too for my education site | (https://learnetto.com) and I couldn't agree more - Stripe has | done a stellar job. | ttoinou wrote: | report taxes. Stripe tax does all of that | | It doesn't say they file the taxes for you. "Speed up filing | and remittance with comprehensive reports" means they will help | you with it, but not do it for you. Later on the website : | "Stripe reports surface all the information you need for each | filing location, so you can easily file and remit taxes on your | own, with your accountant, or with a preferred partner. | | US filing partner TaxJar EU filing partners Taxually Marosa" | ______- wrote: | > It doesn't say they file the taxes for you | | Yay for automation, but is using third parties to file taxes | not open to fraud and potential error (if you don't do it | yourself?) | staticassertion wrote: | Gusto files your taxes for you. | dangrossman wrote: | I pay TaxJar to prepare and file my sales tax returns for | me. | | Stripe just acquired them in April. | hobs wrote: | Literally all companies pay other people (accountants, | lawyers) to do their taxes and in many cases they are third | parties so no, that is not the case. | | https://www.irs.gov/businesses/small-businesses-self- | employe... | cperciva wrote: | Not literally all. I can name several small businesses | which do their own taxes. | faeyanpiraat wrote: | ---> small <--- | cperciva wrote: | Yes. The comment I responded to said "literally all | companies", not "literally all large companies". | PeterisP wrote: | They're just using the word "literally" in its ever more | popular sense in which it does not mean that it really | does apply to all companies. | | For example, according to Oxford dictionary https://www.o | xfordlearnersdictionaries.com/definition/englis... "used | to emphasize a word or phrase, even if it is not actually | true in a literal sense" or Merriam Webster | https://www.merriam-webster.com/dictionary/literally | "used in an exaggerated way to emphasize a statement or | description that is not literally true or possible" ; in | modern usage, "literally" can be it's own antonym and | mean "not literally". Language is fun! :) | hobs wrote: | fwiw I upvoted you because I should have wrote "a | vanishingly small amount of businesses, many who are | probably screwing things up pretty badly" | cperciva wrote: | I suspect that the _majority_ of businesses are small | enough that their taxes are trivial and pretty harmless | -- at least if you weight by count. If you weight by size | -- sure, most business is big business and has complex | taxes. | Cthulhu_ wrote: | Yeah, but they would lose their license and customers and | be sued for damages. The world is not a libertarian / | individualistic wild west. | vvoyer wrote: | Thanks, I updated my comment. | mytailorisrich wrote: | The downside is of course that Stripe takes over more and more | of your important infrastructure. A question should always be | how to include several suppliers and/or how to change supplier | in order not to put all in your eggs in a single basket. | yannoninator wrote: | The cost of letting Stripe do all the work than moving over | to another provider is extremely costly and can damage sales. | | Unless your provider really sucks, it's always important to | evaluate carefully and ideally stick with them unless it is | really that bad. | mytailorisrich wrote: | > _The cost of letting Stripe do all the work than moving | over to another provider is extremely costly and can damage | sales._ | | Yes, that's exactly my point: At some point you are | completely locked in with a single supplier that holds your | entire income stream and perhaps even more than that. | | Ideally (easier said that done, I know) you want to have at | least 2 suppliers for any key piece of infrastructure as | early as possible and to avoid letting a supplier 'expand' | the number of tasks they do for you too much. | | The latter seems to be Stripe's strategy: They start with | payments then expand step by step in everything related et | even in things like company incorporation. | staticassertion wrote: | I imagine that most businesses have bigger risks to deal | with than this, especially in early to mid stages (where | Stripe seems to target). | mytailorisrich wrote: | Perhaps. You should always keep that in mind, though, and | avoid building your system tightly-coupled to any single | supplier. | hardwaresofton wrote: | A few questions I think are interesting: | | Does Stripe do well in a world where governments provide | efficient and easy online payments? Places like Sweden with | Swish. | | Does Stripe do well in a world where governments provide | simplified/near-zero-work tax calculation mechanisms? <todo: find | an example>. | dagw wrote: | Stripe and Swish solve different problems. Swish is mobile | phone based direct bank transfers, Stripe is credit/debit card | transactions. The big problem with Swish is that it only works | if you have a phone with a Swedish SIM card and a Swedish bank | account in a supported bank (which admittedly is most of them). | With Stripe you can take money from anyone with a Visa or | Mastercard | hardwaresofton wrote: | > Stripe and Swish solve different problems. Swish is mobile | phone based direct bank transfers, Stripe is credit/debit | card transactions. | | At a higher level of abstraction, these are are the same | problem -- conveniently and safely paying money to another | entity (whether person or business). If we assume that | normally someone has a phone at the same time they have their | credit/debit card, then the _how_ isn 't really that | important is it? | | > The big problem with Swish is that it only works if you | have a phone with a Swedish SIM card and a Swedish bank | account in a supported bank (which admittedly is most of | them). With Stripe you can take money from anyone with a Visa | or Mastercard | | This is why I asked _inside_ countries like this -- if you | 're in Sweden and (I saw a documentary on DW a while back | about how cash is actually becoming so rare that handling it | is starting to be disincentivized -- ATMs disappearing, banks | not wanting to hold cash because of relative liability, etc), | let's assume you have a phone with a Swedish SIM card and a | Swedish bank account and a phone. | | Swish in Sweden is just the only good example I know of, but | I think that after a while something that looks like it will | be everywhere (US, EU, UK, etc). Cashless economies are | generally welcomed by governments and most businesses, most | people don't even know the usual privacy/accessibility/etc | talking points (opposite from the usual HN reader). | | So again, in a situation where it is very likely that you | could use Swish with ~0 fees or Stripe, do people continue | choosing Stripe? | | Or a better question -- how easy would it be to compete with | Stripe (without having to offer the key lower parts of the | stack that Stripe initially solved)? | | BTW Stripe also does ACH -- I use it for larger payments when | dealing with clients and it works very well. | dagw wrote: | _So again, in a situation where it is very likely that you | could use Swish with ~0 fees or Stripe, do people continue | choosing Stripe?_ | | Why not both? First of all, Swish is only free for | transfers to or from private individuals. Companies pay a | pr transaction fee. I don't know how the fees compare, but | it is probably not a huge difference. If you're a company | handling a huge number of transactions pr day I suspect | you'll be able to negotiate a better deal with a card | processing company. | | Also there are still people inside Sweden who have | credit/debit cards but not Swish, for example tourists, | older people or people here on temporary work contracts. | | Secondly there are reasons why people would want to use a | credit card instead of having the money taken directly from | their bank account. One such reason is if it's a company | making the purchase it is much more convenient to use your | company card. Another aspect is if you have more than one | bank account (say your personal account and a joint account | with your spouse) then you might have different cards tied | to different accounts. You cannot do that with Swish. | | Basically while there is some overlap between Swish and | companies like Stripe, they aren't really drop in | replacements for each other. | | Edit: From a technical point of view there is probably | nothing stopping Stripe from adding Swish as a payment | option to their API if they wanted to have that as a | feature for the Swedish market. | hardwaresofton wrote: | These are very good points. I had it in my head htat | | > Why not both? First of all, Swish is only free for | transfers to or from private individuals. Companies pay a | pr transaction fee. I don't know how the fees compare, | but it is probably not a huge difference. If you're a | company handling a huge number of transactions pr day I | suspect you'll be able to negotiate a better deal with a | card processing company. | | Yeah but this is just an extension of... taxation when | the government does it right? The fee seems to be 2 | kronor[0][1] this is static _not_ %-based. I 'm not a | huge payment processor but $0.24 USD/transaction seems | _REALLY_ good to me. The fact that it 's not % based is | just a complete shift of the cost dynamic -- if you sell | something for $1000 and pay 0.24 for the transaction the | fee is 0.00024%. I don't know what kind of numbers you | have to do to get that from a card processor. | | > Also there are still people inside Sweden who have | credit/debit cards but not Swish, for example tourists, | older people or people here on temporary work contracts. | | Yup, I've heard this mentioned, people who went for a | concert had a terrible time, etc. | | > Secondly there are reasons why people would want to use | a credit card instead of having the money taken directly | from their bank account. One such reason is if it's a | company making the purchase it is much more convenient to | use your company card. Another aspect is if you have more | than one bank account (say your personal account and a | joint account with your spouse) then you might have | different cards tied to different accounts. You cannot do | that with Swish. | | This is a good point -- but I want to push back that you | can't do it with Swish _now_. Doesn 't feel like a really | hard problem. | | > Basically while there is some overlap between Swish and | companies like Stripe, they aren't really drop in | replacements for each other. | | They aren't drop in replacements for each other _if any | of the scenarios you 've outlined is the case_, but I | intended to restrict the situation to the case where they | _are_ roughly identical. In that situation, do people use | stripe? | | > Edit: From a technical point of view there is probably | nothing stopping Stripe from adding Swish as a payment | option to their API if they wanted to have that as a | feature for the Swedish market. | | Ok so this is a bit closer to what I'm trying to get at | -- Why would a merchant pay ~3% compared to 2SEK? Is | Stripe worth 3% when all you need them to do is process | the payment? | | [0]: https://insights.nordea.com/en/innovation/the- | benefits-of-sw... | | [1]: https://medium.com/@etiennebr/swish-the-secret- | swedish-finte... | LeonidasXIV wrote: | MobilePay in Denmark (which is about the same as Swish, | with very similar constraints wrt to phone numbers and | banks) seems to be trying to enter the online payments | business. But it does require MobilePay which is ubiquitous | in Denmark, but utterly useless outside of it. So the | rollout to other markets is slow to non-existing (and given | how Danish banks - which run MobilePay - seem not to be | aware of the rest of the world), so if I were a merchant no | way in hell I would chose to exclusively accept MobilePay | online. | MayeulC wrote: | Not available in the EU. | | Full text from wayback machine: | https://web.archive.org/web/20210609031856/https://www.khq.c... | | > Tilly, the 2-year-old Border Collie who was ejected from a car | Sunday during a crash, has been found. | | > He was found on a sheep farm, where he had apparently taken up | the role of sheep herder. | | > According to Tilly's owner, he has lost some weight since | Sunday's crash and is now drinking lots of water but is otherwise | healthy. | | > _PREVIOUS COVERAGE:_ | | > RATHDRUM, Idaho - The Idaho State Police (ISP) is investigation | after a crash blocked SH-41 and Hayden Avenue on Sunday | afternoon. | | > ISP said they are looking for people who witnessed the | incident. | | > The crash happened when a GMC Yukon towing a white horse | trailer attempted to turn south onto SH-41 when a Buick struck | the GMC. | | > The driver of the Buick, a man from Spirit Lake, was | transported to a nearby hospital and was treated and released. No | one else was injured. | | > During the crash, a dog was ejected from the rear of the GMC | and is still missing. | | > ISP said the dog is a 2-year-old Border Collie Heeler mix that | goes by the name "Tilly". Tilly has no tail, a dark-colored face, | weighs approximately 70 pounds, and was wearing a multi-colored | plaid and tan-colored collar with a name tag containing the | owner's contact information. | | > Tilly was last seen running northwest from the crash scene | through the field. | franciscop wrote: | 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. | eloisant wrote: | > 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. | | AFAIK this is true for any other country, not just Japan. If | you're in US, and you want to sell and ship products outside of | US, you need to take care of the sales taxes and customs for | each of the countries you ship. | | Or you leave the burden to your customers, but they might not | be happy to have to pay expensive custom to the mailman to get | their package. | franciscop wrote: | Apparently it's either not a requirement or not so strongly | enforced in the US and EU as it is in Japan, or that was my | understanding from the conversation. | | Update: searching a bit and reading about the EU sales taxes, | there are few rules but overall it's pretty clear you either | don't pay or pay local sales taxes even for international | sales for low-volume B2C sales (sorry it's Spanish): | https://www.carrilloasesores.com/post/iva-de-ventas-por- | inte... | Naga wrote: | In Canada, it is a requirement to self-assess GST on | purchases you make online. When you buy something online, | you're supposed to fill out a form and mail a cheque to the | government for the GST you should have paid on it. That | being said, this is completely unenforced as well as | unenforceable. Also, if you ask basically anyone in Canada | they probably would have no idea this was a rule, but the | rules are the rules. | | https://www.canada.ca/en/revenue-agency/services/forms- | publi... | raverbashing wrote: | Great Job. | | As much as taxes suck, taxes on online transactions are becoming | ever more common (and not only in the EU). If anyone is curious, | this is a good write up of how it works | https://support.patreon.com/hc/en-us/articles/360043055071-S... | (and on Patreon it gets even more complicated because it changes | by US state and type of perk) | stevoski wrote: | Awesome job from Stripe on this one. For years, the lack of | VAT/Sales tax handling in Stripe's Checkout was a glaring | omission. | | They've really delivered with an outstanding solution. | theflyinghorse wrote: | The feature is of course very nice, but the pricing is steep at | 0.5% of your transactions. So I'm giving away 0.5% of my revenue | (provided all of my revenue comes from sales) for the privilege | of having my taxes calculated? That's on top of the 2.9%+30c per | transaction that I already pay stripe? | TheRealPomax wrote: | Correct. But that's not what you're paying for of course, | you're paying for the fact that you _don 't_ need to pay an | accountant to double check these numbers: if they are wrong and | the tax man comes after you, you get to hold Stripe accountable | for any and all repercussions. You are paying Stripe--if you so | choose--to take on the legal responsibility of getting it | right. | nrmitchi wrote: | > if they are wrong and the tax man comes after you, you get | to hold Stripe accountable for any and all repercussions. You | are paying Stripe to take on the legal responsibility of | getting it right. | | Where exactly is this stated? As far as I can tell, all this | does is say what taxes you should be collecting, and then | collect them. It doesn't even handle (at this point) | remitting payment to the appropriate jurisdications. | | I see no evidence that if your taxes are collected wrong, | Stripe will do anything other than say "Your accountant | should have caught that, sorry." I see no evidence that by | using this product, Stripe will indemnify you against tax | issues (which yes, would go a long way to justifying the | cost) | [deleted] | giovannibonetti wrote: | This is specially valuable if you are selling your product | across multiple countries, which may have different taxes. | koolba wrote: | Is that legally binding somewhere? If they completely miss | out that we were meant to collect X% for a municipality, will | they be covering that out of their pocket? | giansegato wrote: | I don't really think you're paying for accountability. That | would involve some serious risk taking on Stripe side. I see | no mention of this in the marketing material. | bo1024 wrote: | It seems like the thing that makes it steep is the percentage | rather than a charge per transaction, right? Philosophically | it's geared to the total value you generate rather than the | value they provide to you. | corentin88 wrote: | That's also on top of Stripe Checkout (0.5%) and on top of | Stripe Radar (0.5%). Stripe cuts about 5% of every SaaS in the | end. That's a lot of money. | kmoriarty wrote: | Hey! Kelly from Stripe here: Just to clarify, there's no | additional cost for using Checkout, and Radar is per small | per transaction fee (or included free with Stripe if you're | just starting out!), not a variable 0.5% fee. | corentin88 wrote: | Thanks for clarifying! That's something I was looking at on | the landing page and didn't find that. So Checkout already | includes Stripe Tax at no additional cost. That's great to | hear | nrmitchi wrote: | > So Checkout already includes Stripe Tax at no | additional cost. That's great to hear | | I am no Stripe pricing authority, and have no relation to | the company, but I'm pretty sure that is *not* what she | said. | | She said that Checkout does not have an additional cost | on top of transactions fees, not that Tax does not have | an additional cost. | beilabs wrote: | 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 entity wouldn't have to collect US | state taxes. | stevoski wrote: | No, that's not correct at all. | | Each country has their own laws about how tax works for online | sales, and who is expected to pay it. | | You can choose to ignore what governments in other countries | expect. But that's your decision. | andylynch wrote: | You would hope so, but no. A good example is that the UK now | requires online business to collect UK VAT on sales to UK | customers, even when the seller is abroad - there are many | similar rules and this will really help people, especially | smaller businesses who really face big barriers in dealing with | these rules. | gardaani wrote: | 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. | andylynch wrote: | Even domestically - US interstate sales tax rules are a mess | too. | fuzzylama wrote: | That's not how it works within Europe. You need to collect | taxes in the country where your customer is located, you need | to register with VAT instances in those countries. There are | exceptions, for example up to some total revenue you may be | allowed to collect local sales tax instead. This is what I've | understood, but it probably gets more complicated in real. | raverbashing wrote: | > You need to collect taxes in the country where your | customer is located, you need to register with VAT instances | in those countries | | Correct for the 1st part, on the 2nd part there is a VAT MOSS | (One Stop Shop) where you report it in one place your | sales/VAT for all the EU countries | brk wrote: | That kind of used to be the way it worked, but not for the last | several years. Now you are generally expected to know about the | tax laws and requirements for the customers region and collect | and submit tax accordingly. | | Avalara (https://www.avalara.com/us/en/products/sales-and-use- | tax/ava...) has been one of the go-to software platforms for | this purpose. At least according to my wife, who is a CFO, and | generally has to manage this stuff. | xchaotic wrote: | Ben Evans once described Stripe as tax on Internet SaaS. For a | moment I'd thought it was Stripe admitting the same. | vincentmarle wrote: | Ha I thought exactly the same thing. 2.9% + $0.30 tax to be | exact. | kybernetikos wrote: | 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). | dangrossman wrote: | 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. | kybernetikos wrote: | I would take that as an argument that we should have better | 'cash' that has lower costs to use. | nrmitchi wrote: | Tbh these are debit cards. The Durbin Amendment limited | the interchange that count be charged on debit | transactions (I think the average is something like 0.3% | now), so everyone was pushed towards "credit" products | instead. | swyx wrote: | i think that is generally a compliment though, not an | accusation | ceejayoz wrote: | The same "tax" existed before Stripe, and it was higher, in | both overall costs and development complexity. | mixmastamyk wrote: | "The price of doing business." | leptoniscool wrote: | If I buy something from one state and ship it to someone in | another state with a different tax-rate, which tax regime | applies? | kmoriarty wrote: | TL;DR: It depends on which state :) There's some more info | here: https://stripe.com/docs/tax/supported-use-cases#us-sales- | tax ___________________________________________________________________ (page generated 2021-06-10 23:00 UTC)