What is Stripe Managed Payments?

Stripe Managed Payments is Stripe’s merchant of record solution: for eligible transactions, Stripe becomes the legal seller and deals with indirect tax compliance, fraud prevention, disputes, and transaction-level support.

Generally, a merchant of record is the entity legally responsible for a sale. It collects and remits sales tax, VAT, and GST. The merchant of record is also the entity that manages customers’ refund and chargeback requests and takes on the corresponding liability. When Stripe takes over this role, you generally don’t need to register for tax in the countries it covers, at least for the sales it handles. There are a few exceptions: for domestic sales in Japan and domestic B2B sales in Singapore, tax responsibility stays with you. In that case, tax responsibility remains within your domain.

This product traces its origin to Lemon Squeezy, the merchant of record platform that Stripe bought in July 2024. Actually, the legal seller under Managed Payments is a Stripe affiliate built up from the Lemon Squeezy system and can show up on customer invoices as “LemonSqueezy Sold through Link, LLC.” Stripe ran a private preview in 2025, opened a public preview in February 2026, and made Managed Payments generally available in April 2026.

Stripe is not a merchant of record by default; it becomes one only when you use Stripe Managed Payments. By default, you remain the sole Merchant of Record on all your Stripe activities, including Stripe Payments, Stripe Billing, and Stripe Tax.

Managed Payments runs on top of your existing Stripe account. In practice, each sale follows the same path:

1. Checkout. The customer pays through Stripe Checkout (hosted or embedded) or a Payment Link. Adaptive Pricing shows the price in local currency by default.
2. Tax withholding. Stripe calculates the applicable sales tax, VAT, or GST and withholds it from the payment.
3. Receipts. Link, Stripe’s consumer brand, emails receipts, invoices, and refund notices to the customer.
4. Statement. The customer’s bank statement shows “LINK.COM*” followed by your statement descriptor.
5. After the sale. Customers manage orders and subscriptions at link.com, and Link handles payment-related support.

Because customers see Link as the seller, your brand appears mainly on the product itself and the checkout page.

Stripe manages the obligations associated with transactions, and you maintain the product and the customer relationship.

Alongside those obligations, Stripe Managed Payments incorporates two functionalities: localized checkout in local currencies via Adaptive Pricing and local payment methods; and selective activation for specific products, markets, or checkout sessions.

Eligibility depends on where your business is based, what you sell, and how you integrate.

• Seller location: 37 countries, including the US, Canada, the UK, EU member states, Switzerland, Norway, Australia, Hong Kong, Japan, and Singapore.
• Products: software, SaaS, AI services, video games, digital media, online courses, and web services, each with an eligible tax code.
• Excluded: physical goods, professional services (such as consulting, design, development, or tech support), live in-person events, and anything that needs human delivery, such as one-to-one coaching.
• Integration: direct accounts only. Connect platforms, Express accounts, and accounts under platform control are not applicable in this context. You must also sell directly to customers, not through a marketplace.
• Buyers: customers can purchase from more than 195 countries, except restricted markets including China.

Stripe​‍​‌‍​‍‌ conducts the customer or business check and grants access only if they have a low historical dispute rate, no previous risk issues, or other problems. Stripe Managed Payments supports businesses registered only within these 37 countries.

Also note the blocked buyer countries: customers in Ascension Island, China, Cuba, Iran, Kosovo, North Korea, Russia, Syria, and Tristan da Cunha can’t buy through Managed Payments.

Cards, Apple Pay, Google Pay, and Link operate on a worldwide scale. Stripe also includes local methods alongside these:

The presentation of certain methods occurs when the price is rendered in local currency. Klarna, Afterpay, Samsung Pay, PAYCO, and Bancontact are configured for single payment transactions rather than recurring subscription models. Klarna and Afterpay are not standard inclusions; their activation involves a request to Stripe Support. Each method has its own processing rate, which applies on top of the 3.5% fee.

Stripe charges 3.5% per successful Managed Payments transaction, in addition to standard payment processing fees. Importantly, the fee is calculated on the full amount, including tax.

The 3.5% fee from Stripe is for tax processing, fraud protection, dispute management, and support via Link customer support. Other costs are relevant based on transaction type: 0.7% for Stripe Billing subscriptions (volume-based), 1.5% for international card processing, and $15 per dispute event.

Here is what a $100 charge (tax included) costs with US standard rates:

Stripe Tax is a taxation feature, while Managed Payments refers to a seller change. Using the former, your company is still the merchant of record, and you are responsible for registrations as well as filings. Managed Payments, on the other hand, makes Stripe the legal seller, so tax liability in covered countries moves to Stripe.

Think of it this way: Stripe Tax is a calculator for your tax return. Managed Payments is an accountant who signs the return and answers to the tax office.

1. Confirm that your business location and products are eligible.
2. Enable Managed Payments in your Stripe Dashboard settings and accept the terms.
3. Assign an eligible digital tax code to every product. A variation in current arrangements may impact the applicability of Managed Payments for that product.
4. Turn it on per Checkout Session through the API, or per Payment Link in the Dashboard or API. Existing subscriptions are not eligible for conversion to Managed Payments; this system is applicable solely to new subscriptions.
5.   Update your support email, since Stripe uses it for escalations.

Before switching all traffic, it would be wise to first carry out a trial of the service against a single product line and assess your approval rates and what kind of additional fees you will be liable for. Customers should be informed about the new “LINK.COM*” statement descriptor for charges.

Stripe developed Managed Payments as an extra layer to its payment processing solution. Dedicated merchants of record offer tax, billing, payments, and support as an integrated package under a unified pricing model. One of the companies in this category is PayPro Global, which for more than 20 years has provided a merchant of record service to software and digital product companies.

Why an experienced, all-in-one MoR might be a better choice:

• Lower, predictable cost. For SaaS businesses, Stripe Managed Payments may involve different financial considerations compared to an all-in merchant of record, influenced by its fee aggregation. A $100 international subscription renewal typically involves a Stripe fee of about $8.90. With monthly sales at $50,000, an annual amount of $6,000 is represented by each percentage point of fee reduction. An all-in price that combines billing, fraud prevention, and tax may result in a particular financial structure and forecasting process.
• Wider coverage from day one. An established merchant of record maintains tax registrations, payment methods, and local acquiring capabilities, while Stripe’s scope in these areas is subject to ongoing development. It is possible to operate in a greater number of markets when direct responsibility for compliance gap management is not present.
• Higher approval rates. Directing payments to the acquirer with the highest approval probability, and utilizing local processing when feasible, can influence revenue outcomes compared to a single-processor configuration.
• Your brand at checkout. Purchases made by customers on a branded, localized page in their own language can influence customer confidence and affect the frequency of ‘unknown charge’ disputes.
• Billing built for software. Trials, upgrades, usage-based plans, dunning, and license management are provided within the core system, not as distinct products for configuration.
• Experience you can lean on. Having handled tax audits, chargebacks, and regulatory changes for twenty years, alongside a dedicated account manager, may affect the prevalence of unanticipated issues during periods of company growth.

Ask yourself:

• Is my business based in a supported country, and are all my products fully digital?
• Am I already on Stripe Checkout or Payment Links, or willing to move?
• Do I sell into many tax jurisdictions without local registrations?

Decision factors:

• Effective cost at your real mix of countries, cards, and subscriptions
• Tax coverage for your top buyer markets
• How much checkout branding and control you need
• The cost is influenced by the specific combination of countries, card types, and subscription models

Stripe Managed Payments is applicable for small, Stripe-native businesses that sell basic digital products via Stripe Hosted Checkout or Payment Links, particularly to buyers within Stripe’s tax-covered markets. It is applicable to categories that some merchants of record do not accept, for instance, web hosting and streaming subscriptions. However, in contexts such as global commerce, subscription operations, or close margin monitoring, its fee arrangement and coverage parameters may present notable financial considerations. In the context of growing SaaS companies, an experienced, all-in-one merchant of record like PayPro Global is associated with varying financial outlay and risk levels.