Payment provider recommendations for the EU?
Hi everyone
Just a quick question, who do you use as your payment provider? And why?
Being based in the EU means that Stripe isn't really much of an option (Or at least wasn't last time I checked due to tax reasons?), and I am currently looking at Paddle, but was wondering if there are any others that I should be considering.
Things have changed at Stripe regarding VAT. At AppSignal – a Dutch company – we’ve been using Stripe for eight years. They’ve processed 50K transactions for us.
In the beginning, that definitely required custom code (using callbacks) to do VAT magic. We wrote about that in 2014 and 2015, with updates in 2019 and 2021. Some of this is pretty specific about our solution in combination with the accounting software we use, but some may apply to your situation.
The TL;DR probably is that nowadays, you can set the correct country and VAT amount for each customer, and “it just works” (e.g. Stripe adds the correct VAT amount).
I hope this helps! Feel free to ask any additional questions too. We’ve been pretty happy with Stripe over the years.
Thank you for the response! So do you collect the VAT? And then pay it over to each of the different tax authorities? I was under the impression that I would have to register a company in each of the EU countries and it is way too early for that.
Yes, we collect VAT (based on the tariff of the consumer's location). There's a thing called One-Stop Shop (OSS). In our case, we registered for OSS with the Dutch tax office and file our EU VAT through that one interface, and pay it all in one go. The various EU member states then figure out who gets paid what.
This is only for B2C by the way; over 95% of our EU customers are registered businesses with valid VAT registration and for them, we simply use the "reverse-charging" mechanism, which means we don't charge VAT but the customer files for it locally.
I did not know about that. Will look into it!
Thank you very much!
Sure thing! And as always: I’m not an accountant, lawyer or a professional in any sense of the word, so please check with an actual professional in your jurisdiction :)
Of course :)
I'm not sure why wouldn't you be able to use Stripe but it's better if someone with more experience answers this.
As for alternatives, there is Paddle and there is Mollie.
Hi, thanks for the response! I will check out Mollie as well!
I think this sums up the frustration quite nicely
https://stefanbauer.me/articles/the-hell-of-taxes-when-building-a-saas-in-europe
Though it was written in 2018 so maybe things have changed in the meantime?