Gumroad vs Payhip vs Lemon Squeezy: fees, VAT and payouts compared

The short answer

Gumroad and Lemon Squeezy are merchants of record: they resell your software or download, collect and pay the sales tax and VAT, and pay you out from their own balance. Payhip is not. Buyers pay straight into your own PayPal or Stripe account, but Payhip still files EU and UK VAT and US and Canadian sales tax for you. On a $25 sale with half the buyers outside the US, fees come to 16.1% of sales on Gumroad, 7.8% on Lemon Squeezy and 5.8–24.6% on Payhip with Stripe, depending on plan and volume (Finzil, prices checked 22–23 October 2026).

• Gumroad: 10% + $0.50 a sale, plus card processing of 2.9% + $0.30.
• Lemon Squeezy: 5% + 50¢, processing included, plus 1.5% for buyers outside the US, 1.5% for PayPal and 0.5% on subscription payments.
• Payhip: 5% on the free plan, 2% on Plus ($29 a month), nothing on Pro ($99 a month), plus your Stripe or PayPal fees.

Where the numbers come from

Every fee, payout rule and tax position is from the platform's own pricing, help and legal pages, read on 22 October 2026. The Payhip examples use Stripe's US price list (23 October 2026), because Payhip doesn't process cards itself. The Lemon Squeezy section quotes only its CEO's post of 28 January 2026. Nobody paid to be in this article. The selling platforms hub compares nine platforms, and Paddle, the merchant of record built only for software, sits alongside these three in the cost example below.

For software, all three take subscriptions and licence keys

Lemon Squeezy is built around software: SaaS subscriptions, licence keys and downloads. Gumroad sells software subscriptions as memberships next to e-books and courses. Payhip sells downloads and memberships, with the subscription billing running through your own Stripe or PayPal. Paddle sells software only: SaaS, apps and games.

What they refuse matters more for a software company than what they sell. Lemon Squeezy refuses services of any kind, including development and consulting, so setup work or support contracts can't go through it. Gumroad refuses AI services fulfilled outside Gumroad, such as access to chatbots or image generation. Paddle refuses services not tied to the software. Payhip has no list of its own.

Gumroad's 10% comes before card processing

The headline rates aren't comparable as they stand. Lemon Squeezy's 5% + 50¢ includes card processing; Gumroad's 10% + $0.50 doesn't; Payhip's percentage sits on top of whatever your own Stripe or PayPal account charges.

Lemon Squeezy works its fee out on the order total including tax. Its own example: a $20 product sold in France, where 20% VAT makes the total $24, the fee $2.06 and your share $17.94. Payhip takes its 5% on the price before VAT: on a $10 product sold in France with VAT on top, the buyer pays $12, Payhip takes $2.50 (its $0.50 and the $2 of VAT) and $9.50 reaches your PayPal, before PayPal's fee.

What you keep at $500, $2,000 and $10,000 a month

An illustration on published rates: a $25 sale paid by card, half the buyers in the US and half outside, a US company with a US bank account, Payhip connected to a US Stripe account. Tax, PayPal, affiliates and marketplace sales are left out.

Fees include the platform's fee, card processing and Payhip's monthly price. Paddle publishes 5% + 50¢ as all-inclusive, with no extra for buyers abroad or for subscriptions.

What moves these numbers:

• Subscriptions. If every sale is a subscription payment, Lemon Squeezy's share rises to 8.3%: $825 on $10,000. Gumroad and Payhip list no extra fee.
• Being paid outside the US. Lemon Squeezy charges 1% on bank payouts to accounts outside the US, about $92 on the $10,000 example. Gumroad lists no fee on bank payouts. Paddle pays free when the payout currency matches your bank's country.
• Growing past $20,000 a month. Gumroad's percentage halves for the rest of the month.
• Payhip's plans. Plus costs less than Free above about $970 a month in sales, and Pro less than Plus above $3,500.

Two merchants of record and one reseller for four markets

Gumroad has been the merchant of record for all sales since 1 January 2025. Its terms (section 6.1) appoint it as your non-exclusive reseller, so it collects and pays sales tax, VAT and GST wherever it has an obligation, and you can't choose to leave VAT off. As the seller, Gumroad also keeps the right to set the price at which your product is resold.

Lemon Squeezy is also your non-exclusive reseller (terms, section 5). It calculates, collects and pays the tax on each order, deducts it from your payout and handles refunds and chargebacks. Each payout comes with a reverse invoice, so you never invoice Lemon Squeezy.

Payhip isn't a merchant of record, but it covers four markets. For digital products sold to buyers in the EU and the UK it acts as your reseller and files the VAT every quarter. In the US it's a marketplace facilitator (from 1 July 2026) and in Canada a digital platform operator, so it collects and pays sales tax there. Any other tax you set up is collected and passed to you to file yourself.

Income tax stays with you on all three. What they pay you is your company's revenue.

Payouts: Gumroad and Lemon Squeezy hold the money, Payhip never does

Paddle pays once a month: the balance becomes a payout on the 1st and is sent by the 15th, with a $100 minimum, in 13 currencies.

The account behind the payout decides what you keep

Gumroad pays a company only to a bank in its country of registration. A UK company needs a UK account and a US LLC a US one, though the founder can live elsewhere. It pays in that country's currency and can't pay USD where USD isn't the local currency, so a UK company can't keep dollars. It names Payoneer and Wise among the payout methods it doesn't support. Moving payout country later costs money: unpaid amounts on a country-specific connected account can't follow you and are forfeited.

Lemon Squeezy charges every order in dollars. A payout to an account with US details arrives as dollars, free if the bank is in the US. A payout in another currency is converted at the mid-market rate, and outside the US the 1% bank fee applies. PayPal costs 3% up to $30 abroad, then PayPal's own charges to convert or withdraw.

With Payhip, your Stripe or PayPal account is your bank. Stripe pays out to the bank account you give it, in the countries Stripe supports. Money kept in PayPal is converted and withdrawn at PayPal's rates.

Paddle takes more kinds of account. It pays free by local transfer when the currency matches your bank's country, charges $15, €15 or £15 by SWIFT when it doesn't, and accepts Payoneer and online accounts such as Wise that give you an IBAN or account number and a BIC.

Who can sell, and what else each one refuses

Gumroad takes individuals, as sole proprietors, and businesses, which upload registration documents. Stripe checks identity: photo ID, address and a tax number. Its prohibited list has 56 categories, among them AI services, consulting firms, crypto products, eSIMs and services such as business opportunities and credit repair.

Lemon Squeezy takes anyone who can be paid by bank or PayPal in a supported country. Sellers in India get PayPal only unless Stripe has approved them. It can't take buyers in sanctioned countries, among them Russia, Iran and North Korea. Besides services, its list refuses physical goods, crypto and NFT products, spyware, IPTV, adult content including NSFW chatbots, and private label rights products.

Payhip has no prohibited list of its own. Its terms require an active PayPal or Stripe account and say you must follow their policies, so PayPal's acceptable use policy and Stripe's list of restricted businesses decide what you can sell.

Lemon Squeezy is moving its sellers towards Stripe Managed Payments

Stripe bought Lemon Squeezy in 2024. On 28 January 2026 its CEO, JR Farr, wrote that the team had been building Stripe Managed Payments, Stripe's own merchant of record service, and that this had meant slower support responses and less frequent product updates for Lemon Squeezy users.

The post says Managed Payments supported merchants in 35+ countries, with more to come later in 2026, and that public sign-up without an invite would be announced "very soon". The goal it states is to give Lemon Squeezy users "an easy way to migrate". It gives no date and no fees for Managed Payments. For sellers in countries Stripe doesn't support, it points to Stripe Atlas to incorporate a US C-Corp or LLC.

Lemon Squeezy pays out by bank in 119 countries; Managed Payments covered 35+ when the post was written. A company outside Stripe's country list should check where it would stand before building its billing on Lemon Squeezy. Lemon Squeezy was still taking sales on 22 October 2026, through Sold through Link, LLC, formerly Lemon Squeezy LLC, in Utah.

What to do

1. Check your product against each list. Setup work, support contracts and AI services rule some platforms out before price does.
2. Run your own numbers. Take monthly sales, the share of buyers outside the US, the share on subscriptions and the share paying by PayPal, and apply the rates above.
3. Choose the payout account before you sign up. For Gumroad, a bank in your company's country, in its currency. For Lemon Squeezy, an account that takes USD with US details. For Paddle, an account whose local currency matches the payout. For Payhip, a bank account Stripe pays out to.
4. Keep the payout records. Reverse invoices and sales exports are your evidence for income tax, and for your bank when it asks where the money comes from.
5. On Lemon Squeezy, watch for the Stripe move and check that Managed Payments covers your country.

Questions people ask

Is Payhip a merchant of record? No. Buyers pay into the seller's own PayPal or Stripe account. Payhip does act as reseller for EU and UK VAT on digital products and collects and pays US and Canadian sales tax (Payhip, checked 22 October 2026).

Which costs less, Gumroad or Lemon Squeezy? On a $25 sale with half the buyers outside the US, Lemon Squeezy's fees come to 7.8% of sales and Gumroad's to 16.1%, at $500, $2,000 and $10,000 a month. Lemon Squeezy then charges 1% on bank payouts outside the US (Finzil, October 2026).

Can Gumroad pay out to Wise or Payoneer? No. Gumroad names Payoneer and Wise among the payout methods it doesn't support. It pays to a local bank in 120 countries in the local currency, and to PayPal in USD elsewhere (Gumroad, checked 22 October 2026).

Is Lemon Squeezy shutting down? Its CEO wrote on 28 January 2026 that the team is building Stripe Managed Payments and plans an easy way for Lemon Squeezy users to move there. The post gives no date. Lemon Squeezy was still taking sales on 22 October 2026.

Can I sell subscriptions on Payhip? Yes, as memberships, paid into your own Stripe or PayPal account. Payhip takes 5%, 2% or nothing by plan, and your processor's fees apply on top.

Sources: gumroad.com pricing, fees, getting paid, currency and payout delay help articles, prohibited list and terms; lemonsqueezy.com pricing, fees, getting paid, currencies, supported countries, prohibited products and terms, and "2026 Update: Lemon Squeezy + Stripe Managed Payments" (28 January 2026); payhip.com pricing, VAT and taxes pages, help centre and terms; paddle.com pricing and help centre; all checked 22 October 2026. stripe.com/pricing (US), checked 23 October 2026. Worked examples are Finzil's illustration on those published rates. General information, not financial or legal advice.