[smca_]

To clarify, Stripe Tax is our product that helps you automatically calculate taxes.

If you'd like to do it yourself, you can manually define rates at no cost: https://stripe.com/docs/billing/taxes/tax-rates.

[hermitcrab]

I use a 'full-service' payment provider. I send the customer to their shopping cart page. The customer buys the software license from them. And they buy the license from me. They are the 'merchant of note' and collect and remit the VAT/sales tax. They pay me once a month, minus fees.

So how does Stripe tax work? Can Stripe function as the 'merchant of note'? If I am based in the UK and selling to someone in the UK, Germany or the US, will it collect and remit the taxes for me? Or just tell me how much I owe?

[mynameisvlad]

Who said anything different or implied they didn’t understand this?

Nobody is arguing that Stripe Tax is not a valuable product, or that the tax landscape is not extremely complicated and worth 0.5% of a transaction.

I am, explicitly, saying that your framing as taxed transactions being “a very small fraction” of US transactions seems false. You are making it sound like the Stripe Tax surcharge will generally speaking not apply to a business, and therefore shouldn’t be used when calculating the amount your company charges.

Do you have anything to back up this claim?

[motoxpro]

From google:

“ Understanding the state sales tax rules for your SaaS business is difficult due to the many different definitions and categorizations. SaaS for personal use is taxable in Louisiana, Maryland, Massachusetts. SaaS for business use is taxable in Nevada, North Dakota, Ohio.”

Meaning that you don’t have to charge tax in the majority of states. Meaning that it can be negligible. IANAL