[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
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