# Paddle vs Lemon Squeezy: Same 5% + 50c, Very Different Bets > Paddle and Lemon Squeezy both charge 5% + 50c as Merchant of Record. Compare who they serve, what changed after Stripe bought Lemon Squeezy, and the real costs. - **Author**: Deepak Jangir - **Published**: 2026-08-28 - **Category**: Comparison, Payments, SaaS - **URL**: https://dodopayments.com/blogs/paddle-vs-lemon-squeezy --- Paddle and Lemon Squeezy charge exactly the same headline rate: **5% + 50c per transaction**, with no monthly platform fee. Both are Merchants of Record. Both handle global tax. So a pricing comparison is close to useless here. The decision comes down to three things most articles skip: who each platform is actually built for, what happens to the fee once your sales go international, and the fact that one of them is now owned by Stripe. ## The one-table version | Area | Paddle | Lemon Squeezy | Dodo Payments | | --- | --- | --- | --- | | Headline rate | 5% + 50c per checkout transaction | 5% + 50c per transaction | 4% + 40c domestic US | | Monthly fee | None | None | None | | Commercial model | Merchant of Record | Merchant of Record | Merchant of Record | | Ownership | Independent | Owned by Stripe | Independent | | Built for | B2B SaaS, scaling software companies | Indie makers, digital products, small SaaS | AI-first and SaaS companies | | Products under $10 | Custom pricing, contact sales | Standard rate | Standard rate | | Invoicing | Custom pricing, contact sales | Included | Included | | International cards | Included in headline, FX margin applies | Included in headline | +1.5% | | Subscriptions | Included | Included | +0.5% | | Tax coverage | End-to-end global compliance | Global VAT and sales tax filing | 190+ countries | ```mermaid flowchart TD A["Merchant of Record at 5% + 50c"] --> B["Paddle: B2B SaaS, sales-assisted, custom tiers"] A --> C["Lemon Squeezy: indie and digital products, now inside Stripe"] A --> D["Dodo Payments: 4% + 40c, independent"] ``` ## What each platform is really built for ### Paddle: B2B SaaS at scale Paddle's pricing page describes an all-inclusive package covering global compliance, 24/7 customer support with a 93% CSAT score, and revenue recovery for failed payments. It offers pay-as-you-go at 5% + 50c and a custom tier for "rapidly scaling and established large-scale businesses" with migration services and success management. The footnotes tell you who it is not for. Paddle's own page states that if you are selling products under $10, or you require invoicing, you need to contact them for custom pricing. That is a clear signal: low-ticket sales and invoice-based billing are not the default path. Paddle has also been moving toward embedded distribution, with Lovable Payments powered by Paddle as a recent example. ### Lemon Squeezy: indie makers and digital products Lemon Squeezy was built for people selling digital downloads, courses, memberships, and small SaaS. Its feature list reflects that: a hosted storefront, license key management, discount codes, pay-what-you-want pricing, lead magnets, and built-in email marketing that is free up to 500 subscribers. Its own pricing page bundles a lot into the 5% + 50c: global VAT and sales tax collection and filing, AI fraud protection, abandoned cart recovery, failed payment recovery, reporting, and customer billing support. For a solo founder shipping a $29 template pack, that bundle is genuinely strong. For a B2B SaaS selling annual contracts with purchase orders, it is not the right shape. ## The Stripe question This is the part that changes the comparison in 2026. Stripe acquired Lemon Squeezy in 2024. In January 2026, Lemon Squeezy published an update announcing Stripe Managed Payments as the first major milestone of that integration, and pointed interested customers to a Managed Payments waitlist. By April 2026, Stripe had shipped Managed Payments into its own API with a `managed_payments` flag on Checkout Sessions and Payment Links. Stripe Managed Payments is Stripe's own Merchant of Record product. It handles indirect tax compliance in more than 80 countries across 35 product categories, plus fraud prevention, dispute management, and transaction-level customer support. Two limits are worth knowing: it works with Stripe Checkout and Payment Links but not Elements, and subscriptions still require Stripe Billing as a separate product. What this means for the comparison is straightforward. Choosing Lemon Squeezy today means choosing a product inside a company that now sells its own Merchant of Record offering. That may be fine, especially if you were heading toward Stripe anyway. It is a real consideration if platform independence matters to you. We cover this in more depth in [Lemon Squeezy vs Stripe](https://dodopayments.com/blogs/lemon-squeezy-vs-stripe). Paddle remains independent. ## Where 5% + 50c stops being 5% + 50c Neither platform's headline rate is what an international business actually pays. The main leak is currency conversion. If you sell in EUR and settle in USD, an FX margin applies on top of the transaction fee. Our [Paddle fees breakdown](https://dodopayments.com/blogs/paddle-fees-explained) models this at a 30% international sales mix and lands at an effective rate near 6.9% rather than 5%. The second leak is fixed-fee drag on small transactions. At a $50 average order value, 50c adds 1 percentage point. At a $10 average order value it adds 5 points, which is why Paddle asks sub-$10 sellers to talk to sales. If you sell low-ticket digital products, model the fixed component before the percentage. A rough comparison at $10,000 monthly revenue: | Average order value | Fixed-fee drag on a 50c platform | Effective rate at 5% + 50c | | --- | --- | --- | | $100 | 0.5% | 5.5% | | $50 | 1.0% | 6.0% | | $20 | 2.5% | 7.5% | | $10 | 5.0% | 10.0% | Before FX. This is the single most under-modelled number in Merchant of Record comparisons. ## Tax handling: broadly equivalent Both platforms are the legal seller, so both carry the registration, filing, and remittance burden that would otherwise be yours. Paddle describes end-to-end tax and compliance handled on your behalf. Lemon Squeezy states that it takes on the liability of tax collection and calculation and pays taxes on your behalf as merchant of record. For most sellers this is a wash. The thing worth checking is coverage in the specific markets you sell into, since "global" means different things at different platforms. Dodo Payments publishes automated tax calculation, filing, and reporting across 190+ countries, and Stripe Managed Payments publishes 80+ countries. If you want the background on why an MoR costs more than a raw gateway, read [why MoRs charge more than gateways](https://dodopayments.com/blogs/why-have-additional-fees-on-an-merchant-of-record-vs-a-payment-gateway) and [what is a merchant of record](https://dodopayments.com/blogs/what-is-a-merchant-of-record). For the EU rules driving all of this, see the [EU VAT guide for SaaS](https://dodopayments.com/blogs/eu-vat-saas-guide-2026). ## Feature differences that actually decide it **Invoicing.** Lemon Squeezy includes it. Paddle routes you to custom pricing. If you sell to businesses that pay against invoices, this alone may decide the question. **License keys.** Both support them. Lemon Squeezy's implementation is a headline feature with issue, deactivate, and re-issue controls. If you sell desktop software or plugins, see [set up a license key system](https://dodopayments.com/blogs/set-up-license-key-system). **Storefront.** Lemon Squeezy gives you a hosted store with a custom domain. Paddle expects you to have your own site. **Email marketing.** Lemon Squeezy has it built in, priced separately by subscriber count and free up to 500. Paddle does not. **Enterprise motion.** Paddle offers migration services, success management, and custom terms. Lemon Squeezy does not compete here. **Usage-based billing.** Both now offer it. If metering is central to your product, compare against purpose-built options in [usage-based billing software comparison](https://dodopayments.com/blogs/usage-based-billing-software-comparison). ## Where Dodo Payments sits Dodo Payments is a Merchant of Record in the same category, priced below both: - 4% + 40c domestic US on cards and wallets - +1.5% for international cards and alternative payment methods - 4% + 15c for domestic India cards and UPI - +0.5% for subscriptions, add-ons, and usage-based billing - Invoicing, tax management, analytics, storefront, license keys, and digital product delivery included at no extra charge - Adaptive currency at 0% to you, with a 2-4% FX fee charged to the customer instead of taken from your margin - $1 per refund, $30 per dispute, free payouts above $1,000 That adaptive currency line is the direct answer to the FX leak described above. Instead of an opaque margin coming out of your settlement, the conversion cost sits on the customer side of the transaction. Coverage is 40+ payment methods, 80+ currencies at checkout, 220+ countries and territories, 14+ languages, PCI DSS Level 1, and 99.99% uptime, used by 50,000+ builders and founders. Start with the [integration guide](https://docs.dodopayments.com/developer-resources/integration-guide), [subscriptions](https://docs.dodopayments.com/features/subscription), or [license keys](https://docs.dodopayments.com/features/license-keys). ## Which should you choose **Choose Paddle if** you run B2B SaaS with an average order value comfortably above $50, you want a vendor with an enterprise motion and migration support, and platform independence matters to you. **Choose Lemon Squeezy if** you sell digital products or small subscriptions, you want a storefront and email marketing bundled, and you are comfortable being inside the Stripe ecosystem. **Choose Dodo Payments if** you want MoR coverage at a lower rate, you sell internationally and want FX handled without eroding your margin, or you need invoicing and usage-based billing included rather than quoted. For wider shortlists, see [Paddle alternatives](https://dodopayments.com/blogs/paddle-alternatives), [Lemon Squeezy alternatives](https://dodopayments.com/blogs/lemon-squeezy-alternatives), and [the best merchant of record platforms](https://dodopayments.com/blogs/best-merchant-of-record-platforms). ## FAQ ### Is Paddle or Lemon Squeezy cheaper? Their headline rates are identical at 5% + 50c with no monthly fee, so neither is cheaper on paper. The difference shows up in your specific mix: Paddle requires custom pricing for products under $10 or for invoicing, while currency conversion margins on both platforms push the effective rate above 5% for international sales. ### Is Lemon Squeezy still independent? No. Stripe acquired Lemon Squeezy in 2024, and in January 2026 Lemon Squeezy announced Stripe Managed Payments as the first major milestone of that integration, directing customers to a waitlist. Paddle remains independent. ### Do Paddle and Lemon Squeezy both handle VAT and sales tax? Yes. Both operate as Merchant of Record, which makes them the legal seller and puts the registration, collection, filing, and remittance obligations on them rather than on you. Verify coverage in your specific target markets, since global coverage varies between providers. ### Which is better for selling low-priced digital products? Lemon Squeezy is the better default of the two, because Paddle's own pricing page asks sellers of products under $10 to contact sales for custom pricing. Note that a 50c fixed fee is 5% on its own at a $10 price point, so model the total take rate carefully at low order values. ### What is the cheapest Merchant of Record option? Rates change, so compare current published pricing. At the time of writing Dodo Payments publishes 4% + 40c domestic US plus 1.5% international, against 5% + 50c for both Paddle and Lemon Squeezy, with Polar ranging from 5% + 50c on its free plan down to 3.4% + 30c on a $400 per month plan. ## Final take Paddle vs Lemon Squeezy is not a pricing decision, because the prices are the same. It is a decision about audience fit and about independence. Paddle is the more serious B2B platform with the harder edges at the low end. Lemon Squeezy is the better indie experience with a parent company that now sells a competing product. If neither trade-off appeals, [Dodo Payments](https://dodopayments.com) offers the same Merchant of Record coverage at 4% + 40c with invoicing and usage billing included. See the [pricing page](https://dodopayments.com/pricing) for the full breakdown. --- - [More Comparison articles](https://dodopayments.com/blogs/category/comparison) - [All articles](https://dodopayments.com/blogs)