Vendors can pay for more visibility on this website, for example a higher place in a ranking or more room on a page. Commercial relationships can also affect which products we feature and how prominently. Every vendor link is marked the same, whatever the arrangement behind it. The largest vendors in merchant of record services
cannot hold places 1 to 3. Places 1 to 3 go to challengers, vendors outside the best-known brands in a category,
wherever the category has them; the established names follow from place 4 in their ranked order. How it works: placement disclosure ·
editorial process.
The 12 tools, reviewed
#1 Creem
Estonian merchant of record for software and digital sellers · Estonia · creem.io
merchant of record SaaS usage billing
Creem's pricing page is the clearest we read: one rate, no monthly fee, no setup fee, and a separate Partner plan for bigger sellers. The product handles tax in more than 50 countries, invoices, refunds and chargebacks, and adds revenue splits, subscriptions and usage billing through an API with SDKs and webhooks.
- Pricing: Per transaction. 3.9% + $0.40 per successful transaction, pay as you go, no monthly or setup fees; custom Partner plan for higher volume. Free plan: none.
- Best for: Indie SaaS and digital sellers
- Strengths: Tax collection and remittance in 50+ countries; Invoices; Revenue splits.
Where it falls short
We found little public track record to check Creem against, and its terms name Armitage Labs OÜ without a registered address we could verify.
Wrong for
Sellers who need a visible track record, a long-standing legal entity or country coverage beyond 50 markets.
Visit Creem →
#2 Lemon Squeezy
Merchant of record for software and digital goods · United States · lemonsqueezy.com
merchant of record software email
Lemon Squeezy pitches itself as the quickest route from product to first paid order: the pricing page says it is free to start, with no trial and no contract, and the ecommerce plan carries no monthly fee.
- Pricing: Per transaction. 5% + $0.50 per transaction with $0 monthly for ecommerce; free to start with no trial and no contract; volume pricing through sales. Free plan: none.
- Best for: Solo and small software sellers
- Strengths: Merchant of record; Global sales tax handling; Ecommerce plan at $0 monthly.
Where it falls short
The operator was renamed Link, LLC (formerly Lemon Squeezy LLC), and the terms give inconsistent state details, so check the contracting entity on your agreement.
Wrong for
Sellers who need fast support, a lower headline rate, or a precise legal entity at signing.
Visit Lemon Squeezy →
#3 Freemius
Merchant of record and checkout for WordPress plugins and themes · United States · freemius.com
WordPress merchant of record licensing
Freemius is the only vendor here built around the way plugin and theme authors sell: licenses, add-ons and updates for WordPress products. Merchant of record is included, and the pricing page lays out a progressive revenue share that starts at 3.8% on up to $50,000 of monthly gross and drops to 0.5% above $100,000.
- Pricing: Per transaction + revenue share. 3.8% + $0.50 per transaction, plus 2.3% for the WordPress solution, with a progressive revenue share from 3.8% to 0.5%. Free plan: none.
- Best for: WordPress plugin and theme sellers
- Strengths: Merchant of record included; Seller on record; Progressive revenue share.
Where it falls short
The WordPress solution adds 2.3% on top of the base rate, so the real cost for a small WordPress seller is nearer 6.1% + $0.50 than the headline. Large volumes need a sales conversation.
Wrong for
Sellers of SaaS subscriptions, ebooks or games with no WordPress component, who would be paying for plugin tooling they do not use.
Visit Freemius →
#4 Paddle
Established merchant of record for software companies · United Kingdom · paddle.com
merchant of record SaaS invoicing
Paddle is the best-known name in this market, and its pricing page keeps the offer plain: 5% + 50c per Checkout transaction, no monthly fees, no migration fees and no hidden extras. It acts as the seller, handles tax and compliance and issues invoices, with different Paddle entities (UK and Irish) contracting depending on the transaction.
- Pricing: Per transaction. 5% + 50c per Checkout transaction, pay as you go, no monthly, migration or hidden fees; custom pricing for high volume through a demo request. Free plan: none.
- Best for: Funded SaaS and software companies
- Strengths: Merchant of record; Checkout; Tax and compliance handling.
Where it falls short
The headline rate is higher than Creem, Freemius or Dodo Payments, and high-volume or complex needs require a demo and a negotiation. Entity structure by transaction type needs a careful read.
Wrong for
Solo creators selling downloads at low prices, who lose a big share to the fixed fee.
Visit Paddle →
#5 Stripe Managed Payments
Stripe's merchant of record product for digital sales · United States · stripe.com
merchant of record Stripe checkout
For a seller already on Stripe Checkout or Payment Links, Managed Payments is the shortest path to a merchant of record. Stripe's documentation says it covers sales tax, VAT and GST compliance in more than 80 countries, plus fraud prevention, dispute management and transaction-level customer support. You keep the dashboard and developer tools you know.
- Pricing: Not verified. Fee not verified by us on a pricing page; check the Managed Payments page. Part of the Stripe account you already hold. Free plan: none.
- Best for: Existing Stripe Checkout users
- Strengths: Sales tax, VAT and GST in 80+ countries; Fraud prevention; Dispute management.
Where it falls short
The documentation lists what does not work: Connect or platform integrations, Elements with the Checkout Sessions API, advanced Payment Intents flows and third-party tax integrations, and subscriptions only run through Checkout or Payment Links.
Wrong for
Marketplaces, platforms and companies with custom billing logic or their own tax tool.
Visit Stripe Managed Payments →
#6 FastSpring
Merchant of record for software and digital sellers · United States · fastspring.com
merchant of record software VAT
FastSpring is an established merchant of record for software publishers, and its pricing page says it acts as merchant of record and collects and remits sales tax and VAT. Rates are a revenue share that varies with sales volume, with discounts for ACH and wire payments and no minimum transaction volume.
- Pricing: Quote only. Revenue share with no published percentage; rates vary with volume and are set through an Account Executive; no minimum transaction volume stated. Free plan: none.
- Best for: Mid-size software publishers
- Strengths: Merchant of record; Sales tax and VAT collection and remittance; ACH and wire discounts.
Where it falls short
No published percentage, so you cannot compare it with Creem or Paddle before a sales call. The page calls for an Account Executive even for rate discussion.
Wrong for
Founders who want to see a fee before they talk to anyone.
Visit FastSpring →
#7 Gumroad
Creator storefront for digital products · United States · gumroad.com
creators storefront marketplace
Gumroad's pricing page states plainly that it is a merchant of record and that it has handled all tax obligations since 1 January 2025. For creators selling ebooks, presets, courses or software through a profile page, it removes the tax question with no monthly fee.
- Pricing: Per transaction. 10% + $0.50 per sale through your own profile or direct links; 30% per sale when Discover brings a new customer; no monthly fee. Free plan: none.
- Best for: Creators using a marketplace
- Strengths: Merchant of record; Tax handling for all sales since 1 January 2025; Discover marketplace.
Where it falls short
At 10% + $0.50, a sale to your own mailing list costs more than double the Creem or Freemius rate. The 30% Discover fee is steep for products with thin margins.
Wrong for
SaaS companies and sellers with their own audience and tight margins.
Visit Gumroad →
#8 Dodo Payments
Merchant of record for software and digital products worldwide · United States · dodopayments.com
merchant of record global SaaS
Dodo Payments publishes a detailed schedule: 4% + $0.40 for a domestic US card, then add-ons of 1.5% for international cards, 0.5% for subscriptions and usage billing, and 3% for buy now pay later and PayPal.
- Pricing: Per transaction + add-ons. 4% + $0.40 per successful domestic US transaction, +1.5% international, +0.5% subscriptions and usage billing, +3% BNPL and PayPal. Free plan: none.
- Best for: Global SaaS and AI startups
- Strengths: Merchant of record; Global tax compliance; Chargebacks and disputes handled.
Where it falls short
Add-ons stack, so a non-US subscription customer can push the real rate toward 6%. Refunds cost $1 and disputes $30.
Wrong for
Sellers with mostly non-US card payers and small average orders, where stacked surcharges eat the margin.
Visit Dodo Payments →
#9 Polar
Open source merchant of record for digital goods and software · United States · polar.sh
open source merchant of record developers
Polar describes itself as an open source and transparent merchant of record. Its documentation says it handles EU VAT, US sales tax and Canadian GST, built on Stripe with more providers planned. The open codebase matters to developers who want to inspect how their money and tax are handled, and its homepage now emphasizes usage and credit billing for AI products.
- Pricing: Not published. Fees not published on any page we could fetch (the pricing URL returned 404). Free plan: open source.
- Best for: Developers and open source maintainers
- Strengths: Merchant of record; Built on Stripe; EU VAT handling.
Where it falls short
No fees were visible to us, and the pricing page was a 404 when we checked. Because it is built on Stripe, you depend on two vendors. The seller remains responsible for income tax.
Wrong for
Sellers who need a known price before integrating, or who want a storefront for non-technical buyers.
Visit Polar →
#10 Fungies
Merchant of record store builder for games and creators · United States · fungies.io
games store builder merchant of record
Fungies pairs a free store builder with merchant of record service. Its pricing page says it calculates, collects, remits and files tax as the legal seller, and the homepage lists VAT across the 27 EU states, US sales tax and GST. The store costs nothing; you pay 5% + 50c per sale, negotiable at higher volume.
- Pricing: Per transaction. 5% + 50c per sale with no monthly fee or setup cost; store builder free forever; rate negotiable at higher volume. Free plan: free plan.
- Best for: Game developers and creators
- Strengths: Merchant of record; Calculate, collect, remit and file tax; Free store builder.
Where it falls short
At 5% + $0.50 the rate is not low, and negotiation only starts at higher sales volume.
Wrong for
SaaS teams that need subscriptions and usage billing in an API, or sellers wanting a rate below 5%.
Visit Fungies →
#11 Payhip
UK sales platform for digital products and courses · United Kingdom · payhip.com
creators storefront VAT
Payhip is the only vendor here that lets you swap a monthly fee for a lower percentage: Free Forever at 5%, Plus at $29 a month and 2%, Pro at $99 and 0%. Its pricing page says it collects and remits EU and UK VAT and US and Canadian sales tax, with unlimited products and revenue on every plan.
- Pricing: Tiered monthly + per sale. Free Forever at $0 per month and 5%. Free plan: free plan.
- Best for: Creators who want a monthly plan
- Strengths: Unlimited products and revenue; EU and UK VAT collection and remittance; US and Canada sales tax.
Where it falls short
The pricing page does not say Payhip acts as merchant of record, so confirm who the legal seller is for your sales. PayPal and Stripe fees come on top of every plan.
Wrong for
Sellers who need a vendor that formally takes the legal seller role everywhere, or subscription software billing.
Visit Payhip →
#12 Xsolla
Merchant of record for game and digital goods sales · United States · xsolla.com
games merchant of record enterprise
Xsolla positions its merchant of record service for global game sales, handling payments, taxes and compliance for publishers and developers. That focus is its strength: a studio selling in-game items to players in many countries gets one seller of record handling tax and compliance.
- Pricing: Quote only. No pricing published; the pricing page offers only a meeting and a contact form. Free plan: none.
- Best for: Game publishers and studios
- Strengths: Merchant of record for global game sales; Tax compliance worldwide; Global payments.
Where it falls short
Pricing is not published, so cost cannot be estimated without a sales conversation. The vendor's own material centers on games, which leaves SaaS and course sellers poorly served.
Wrong for
SaaS founders, course creators and any seller outside games.
Visit Xsolla →
Questions and answers
What is the best merchant of record service in 2026?
Creem ranks first of 12, best for indie SaaS and digital sellers. Lemon Squeezy is second (solo and small software sellers) and Freemius third (wordPress plugin and theme sellers). Places 1 to 3 go to challengers, vendors outside the best-known brands, wherever the category has them.
What does a merchant of record actually do that a payment processor does not?
A payment processor moves money and leaves you as the seller, so you register for VAT and sales tax, file returns and answer for disputes.
How much does a merchant of record cost on a $100 sale?
On published base rates, Creem and Freemius take $4.30, Dodo Payments $4.40 for a domestic US card, and Paddle, Lemon Squeezy and Fungies $5.50.
Is Stripe Managed Payments a real merchant of record option?
Yes. Stripe's documentation describes Managed Payments as a merchant of record product that covers sales tax, VAT and GST compliance in more than 80 countries, fraud prevention, dispute management and transaction-level support.
Do I still owe any tax if I use a merchant of record?
Yes, your own. The provider handles indirect tax on the sale, meaning VAT, sales tax and GST, but not corporate or personal income tax on what you earn.
Which merchant of record suits a WordPress plugin or theme seller?
Freemius. It is built around plugin, theme and add-on licensing, with 3.8% + $0.50 per transaction, a WordPress add-on of 2.3%, and a progressive revenue share that falls to 0.5% above $100,000 of monthly gross.
Can a merchant of record handle subscriptions and usage-based billing?
Several can. Creem lists subscriptions and usage-based billing, Dodo Payments adds 0.5% for subscriptions and usage billing, and Polar's homepage now leads with usage billing for AI companies. Stripe's Managed Payments supports subscriptions only through Checkout or Payment Links.
What is the difference between Paddle and Lemon Squeezy?
Both charge 5% + $0.50 on published pricing and act as merchant of record. Paddle is the older, larger name aimed at software companies, with custom pricing for high volume and a pay-as-you-go entry.
Is Gumroad a merchant of record?
Yes for sales it processes. Gumroad's pricing page says it is a merchant of record and has handled all tax obligations since 1 January 2025.
What can a merchant of record refuse to sell?
Any provider that takes the legal seller role can set limits on product types, and approval can be withdrawn. Xsolla is aimed at games and digital goods, Freemius at WordPress and software products, and Gumroad at creator products.
When should I use a sales tax compliance tool instead of a merchant of record?
When you want to keep your own payment processor, your own customer relationship and a lower fee. A compliance product calculates, registers and files, but you remain the seller of record and carry refunds and chargebacks.
