We don't have merchant of record yet, but this is only the beginning! Today for the US we would provide you analysis such that you know where you need to register (e.g. usually after ~$100k in each state, but varies by state) and once you are registered we can automate both the calculation and the filing/remittance of returns to each US state.
Good point! If you'll allow me to provide a bit more background, when we started talking to users, a merchant of record set up was certainly a fit for some, especially those that didn’t want to even think about tax, but it wasn’t for all.
Some users didn’t want to forgo control over the checkout experience, others didn’t want someone else’s name on the statement descriptor, and others pointed out that merchant of record meant their buyers were paying more than some competitors as they were collecting tax everywhere from day 1, (vs. if you handle yourself you may not need to collect tax in a state or country until you reach a threshold, e.g. California is $500k).
However, one pain point in common across all users, was around the integration and maintenance aspects of handling tax during checkout, so our focus really became how do we abstract away tax at checkout…which is why enabling Stripe Tax really comes down to `automatic_tax[enabled]:true`.
All that is to say, we’re definitely not perfect and always want to hear how we can improve. We’re optimistic that we’ve built solid foundations such that we can now add much more functionality to meet any and all user’s tax needs, or even taking on all liability.
All and all we very much rely on user feedback to prioritize what we build, so if merchant of record would, to quote Patrick recently, be the thing that makes you say “FINALLY”, do let us know!
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.
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.
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
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.
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
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.
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
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?)
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.
