Merchant of Record Fees 2026: 5 Smart Truths to Keep More

Merchant of record fees decide how much of each sale you actually keep — and the headline rate is rarely the whole story. A merchant of record is the company that legally sells your product to the customer: it takes the payment, adds the correct sales tax or VAT, files and pays that tax, handles refunds and chargebacks, then pays you what is left. You stay the maker, but the merchant of record is the seller on the invoice and the card statement. In 2026 the headline rates run from 3.9% + $0.40 (Creem) to 10% + $0.50 (Gumroad direct sales), with Paddle and Lemon Squeezy both at 5% + $0.50 — but surcharges, payout fees and chargeback fees move the real cost by several dollars on every $100 sale. This guide compares the five main options with worked examples you can check, so you can pick the one that leaves you the most.

What a merchant of record actually does for you

Selling a digital product across borders means collecting the right tax in every buyer’s country, filing it, handling fraud and chargebacks, and paying out in the right currency. A merchant of record takes all of that on. It is the legal seller, so it registers for VAT, GST and sales tax where needed, collects the tax at checkout, files the returns and pays the tax authorities. It also runs the checkout, screens for fraud, handles buyer support on payment questions, and takes the hit when a chargeback lands. What you give up is control: the customer buys from the merchant of record, not from you, and the merchant of record sets the payout schedule. For a freelancer selling templates, courses, presets or software, that trade is usually worth it — the alternative is registering for tax in dozens of countries yourself. If you only sell services on gig platforms, you do not need one: the platform is already the seller. Compare the platform side of that choice on our platform fee calculator.

Merchant of record fees in 2026: the five providers side by side

The table makes the first point plainly: Paddle and Lemon Squeezy look identical until you read the surcharge column. Creem is the cheapest headline rate of the five. FastSpring will not give you a number at all without a sales call — which is a real cost in time, and a reason to treat it as a quote-only option. Gumroad is the dearest on direct sales once processing is added, and far dearer again on Discover sales, where it keeps 30%.

Worked example 1 — one $100 sale

Take a single $100 sale to a US buyer paying by US card, one-time purchase, no sales tax (tax is collected on top and remitted by the merchant of record, so it does not change what you keep — except on Lemon Squeezy, where the fee is charged on the total including tax, as its own example below shows).

• Paddle: 5% ($5.00) + $0.50 = $5.50 → you keep $94.50.
• Lemon Squeezy: 5% ($5.00) + $0.50 = $5.50 → you keep $94.50.
• Creem: 3.9% ($3.90) + $0.40 = $4.30 → you keep $95.70 (Creem’s own example gives the same figure).
• Gumroad direct (card): 10% ($10.00) + $0.50 + processing 2.9% ($2.90) + $0.30 = $13.70 → you keep $86.30.
• Gumroad Discover: 30% = $30.00 → you keep $70.00.
• FastSpring: no published rate. Reviewers commonly report around 5.9% + $0.95, which would be $6.85 and a keep of $93.15 — but FastSpring itself publishes no rate, so treat that as reported, not fact, and get a quote.

On a single sale the gap between the cheapest and dearest direct option is $9.40. That gap compounds fast at volume, as the next example shows.

Worked example 2 — a $1,000-a-month seller (20 sales of $50)

Same terms: US buyers, US cards, one-time sales.

• Paddle: 5% ($50.00) + 20 × $0.50 ($10.00) = $60.00 → you keep $940.00. The monthly payout minimum of $100 is met; the wire is free if the payout currency matches your bank’s country, otherwise a $15 SWIFT fee may apply.
• Lemon Squeezy: the same $60.00 → you keep $940.00 on US card sales. But if half your buyers are international, add 1.5% × $500 = $7.50 → keep $932.50. If all of them pay by PayPal, add 1.5% × $1,000 = $15.00 → keep $925.00.
• Creem: 3.9% ($39.00) + 20 × $0.40 ($8.00) = $47.00 → you keep $953.00.
• Gumroad direct (card): 10% ($100.00) + $10.00 + processing 2.9% ($29.00) + $6.00 = $145.00 → you keep $855.00.

At $1,000 a month, Creem leaves you $13 more than Paddle or Lemon Squeezy and $98 more than Gumroad direct. Over a year that is $156 against Paddle and $1,176 against Gumroad — real money for a freelancer, and the reason the headline rate is worth comparing before you commit. One caveat on Gumroad: its fees help article lists a volume tier where direct sales drop to 5% + $0.50 once paid sales in a calendar month reach $20,000, but one source reports it is rolled out seller by seller, so do not plan on it until you see it on your own account.

Worked example 3 — a $49-a-month subscription from an international buyer

This is where Lemon Squeezy’s surcharges stack, and where the “same 5% + $0.50” story falls apart.

• Lemon Squeezy: base 5% ($2.45) + $0.50 = $2.95; then +1.5% international ($0.74) + 0.5% subscription ($0.25) = $3.93 in fees → you keep $45.07, an 8.0% effective rate, not 5%. Its own official example shows the same pattern: a $20 product plus 20% VAT is a $24 total, and the fee is $2.06 with a net profit of $17.94.
• Paddle: 5% ($2.45) + $0.50 = $2.95 → you keep $46.05. No international or subscription surcharge in the headline rate, though Paddle’s agreement adds a currency-conversion margin on payout in some currencies — cited from its agreement by third parties, not read on paddle.com in this pass, so check it if you are paid out in a third currency.
• Creem: 3.9% ($1.91) + $0.40 = $2.31 → you keep $46.69, with no international surcharge.
• Gumroad direct (card): 10% ($4.90) + $0.50 + processing 2.9% ($1.42) + $0.30 = $7.12 → you keep $41.88.

If your buyers are mostly international and mostly on subscriptions, Lemon Squeezy costs about $1 more per $49 sale than Paddle and $1.62 more than Creem — every month, on every subscriber.

Paddle vs Lemon Squeezy: the same headline, a different bill

Paddle and Lemon Squeezy both charge 5% + $0.50 with no monthly fee, and both cover payments, tax collection and remittance, fraud protection and chargebacks. The difference is what happens after the headline. Paddle adds no international or subscription surcharge; Lemon Squeezy adds 1.5% for international buyers, 1.5% for PayPal and 0.5% for subscriptions, and the three stack. Paddle’s chargeback fee is $20 ($40 in Canadian or Australian dollars) and is not refunded even if Paddle wins the dispute; Lemon Squeezy’s is $15 and it usually refunds the buyer on your behalf. Paddle pays once a month, Lemon Squeezy twice a month after a 13-day hold. One more difference matters for planning: Stripe acquired Lemon Squeezy in July 2024, and Stripe is building its merchant-of-record future as Stripe Managed Payments, built by the Lemon Squeezy team. Lemon Squeezy still operates and takes payments, and nothing says it is closing — but if you are choosing for the long term, that direction of travel is worth knowing. Our head-to-head guide on Friday goes deeper on this pair; for now, the rule is simple: if your buyers are mostly US and on cards, the two cost the same; if they are international or on subscriptions, Paddle is cheaper.

Payouts and cash flow: when the money reaches your bank

The fee is only half the cost; the wait is the other half. Paddle pays once a month: your balance converts to a payout on the 1st if it is above the $100 minimum, Paddle sends it by the 15th, and it takes up to 3 working days to arrive, by wire transfer or Payoneer. There is no on-demand withdrawal. Lemon Squeezy pays twice a month: payouts are created on the 1st and 15th, net sales are held 13 days, and the money is paid out on the 14th and 28th, taking 1–5 days to arrive, with a $50 minimum. Bank payouts are free for US accounts and cost 1% per payout for non-US accounts; PayPal payouts cost $0.50 in the US and 3% capped at $30 outside the US. Creem pays on the 1st and 15th to your bank account or USDC wallet. FastSpring does not publish a payout schedule; third-party reviews report twice-monthly payouts with a settlement delay, but that is unverified — confirm it in your quote. Budget for the wait before you rely on the income, especially if you are paid monthly by Paddle and your rent is due on the 1st.

Chargebacks and refunds: the fee you only notice when it hurts

A chargeback is a buyer asking their bank to reverse a payment. The merchant of record handles it, but you pay the fee. Paddle charges $20 per chargeback in USD, GBP or EUR, or $40 in CAD or AUD, deducted from your balance with the transaction amount — and the fee is not refunded even if Paddle wins the dispute, because the payment provider’s own processing fee is non-refundable. Paddle’s acceptable chargeback rate is below 0.65% of transaction volume. Lemon Squeezy charges a $15 dispute fee, usually refunds the buyer on your behalf, and deducts the refunded amount minus the platform fee plus the $15 from your next payout; it may also issue refunds within 60 days at its own discretion to prevent chargebacks. Creem does not publish a chargeback fee on its pricing page, and FastSpring publishes none either — confirm both before you sell. Gumroad’s dispute fee was not verified in this pass and is not stated here. On refunds, Lemon Squeezy keeps its platform fee: the refunded amount minus the platform fee is deducted from your next payout. Keep your chargeback rate low — clear refund policies, honest product descriptions and fast buyer support are cheaper than any dispute fee.

Who each merchant of record suits

• Paddle suits software, SaaS, AI tools, digital products and games sold internationally: one flat rate, no surcharge stacking, and a chargeback process built for digital goods. It does not accept physical goods or standalone human services such as consulting, according to third-party summaries of its terms.
• Lemon Squeezy suits US-focused sellers who want the twice-monthly payout and the Stripe-backed checkout: if your buyers are American and pay by card, it costs exactly what Paddle costs. It gets expensive fast on international and subscription sales.
• Creem suits sellers who want the lowest headline rate and no international card fee: 3.9% + $0.40 beats both 5% providers on every worked example here. Its optional extras — affiliates and revenue splits at 2% each, according to Creem’s own blog — can eat the saving if you use them, so check those before you commit.
• FastSpring suits larger sellers who want a negotiated rate and do not mind a sales call: no published rate means no price to compare, so get the quote in writing and compare it against the 3.9%–5% range before you sign.
• Gumroad suits creators who sell through its Discover marketplace and accept the 30% cut for the traffic, or who value its audience and simplicity over the fee. On direct sales it is the dearest of the five once processing is added, so run the numbers before you choose it as your only storefront. If you sell memberships, compare the maths on our Patreon fee calculator too — and if you sell on TikTok Shop, our TikTok Shop fee calculator runs the same keep-what-you-earn logic for marketplace sales.

Five traps that make merchant of record fees higher than the headline

Trap 1 — trusting the headline rate. Paddle and Lemon Squeezy both say 5% + $0.50, but on an international subscription Lemon Squeezy charges 8.0% effective. Always price your own buyer mix, not the headline.

Trap 2 — the surcharge stack. Lemon Squeezy’s +1.5% international, +1.5% PayPal and +0.5% subscription fees stack on the same sale. A $49 subscription paid by PayPal from abroad costs more than 9.5% before the fixed fee.

Trap 3 — the payout wait. Paddle pays once a month with a $100 minimum; Lemon Squeezy holds sales 13 days. If you need the money weekly, neither schedule fits — plan your cash flow around the payout dates, not the sale dates.

Trap 4 — the chargeback fee that stays. Paddle keeps its $20 even when it wins the dispute. A handful of chargebacks a month can cost more than the fee difference between providers.

Trap 5 — the quote-only provider. FastSpring publishes no rate, so you cannot compare it without a sales call, and reviewers’ reported figures around 5.9% + $0.95 are unconfirmed. Never budget on a reported rate; get the quote in writing first. If you are weighing a subscription platform instead, our Skool pricing guide shows the same headline-vs-real-cost problem on the community-platform side.

FAQs

What is a merchant of record?

A merchant of record is the company that legally sells your product to the customer. It takes the payment, adds the correct sales tax or VAT, files and pays that tax, handles refunds and chargebacks, then pays you what is left. You stay the maker, but the merchant of record is the seller on the invoice and the card statement.

What do Paddle and Lemon Squeezy charge in 2026?

Both charge 5% + $0.50 per transaction with no monthly fee. That headline is identical, but the real cost splits: Paddle adds no international or subscription surcharge, while Lemon Squeezy adds 1.5% for international buyers, 1.5% for PayPal and 0.5% for subscriptions. Paddle also charges $20 per chargeback against Lemon Squeezy’s $15.

Why is Lemon Squeezy not really 5% + $0.50?

Because its own fee docs add surcharges that stack. An international subscription paid by card costs 5% + 1.5% + 0.5% + $0.50, and PayPal adds another 1.5%. On a $49 monthly subscription from an international buyer that is $3.93 in fees, an 8% effective rate, not 5%.

Is Creem cheaper than Paddle and Lemon Squeezy?

Yes, on the headline rate. Creem charges 3.9% + $0.40 per successful transaction with no monthly fee and no international card surcharge. On a $100 sale you keep $95.70 with Creem against $94.50 with Paddle or Lemon Squeezy. Optional extras such as affiliates and revenue splits each add 2%, so check those before you commit.

Why does FastSpring not publish a fee?

FastSpring sells custom, flat-rate pricing set by your transaction type and volume, so you must request a quote from its sales team. Reviewers commonly report around 5.9% + $0.95, but FastSpring itself publishes no rate and that figure is unconfirmed. If you need a number before you sign, FastSpring cannot give you one on its website.

How long until the money reaches my bank?

It depends on the provider. Paddle pays once a month: your balance converts on the 1st and is sent by the 15th. Lemon Squeezy pays twice a month, on the 14th and 28th, after a 13-day hold, with a $50 minimum. Creem pays on the 1st and 15th. Budget for the wait before you rely on the income.

What does a chargeback cost on each merchant of record?

Paddle charges $20 (or $40 in Canadian or Australian dollars) per chargeback and keeps the fee even if it wins the dispute. Lemon Squeezy charges a $15 dispute fee and usually refunds the buyer on your behalf. Creem does not publish a chargeback fee on its pricing page, and FastSpring publishes none either, so confirm both before you sell.

Do I still need to register for VAT or sales tax with a merchant of record?

No, not for the sales the merchant of record handles. It is the legal seller, so it registers, collects, files and pays the VAT, GST or sales tax for you. You still owe income tax on what you earn, and you still need your own records, but the indirect-tax registration and filing sit with the merchant of record.

Sources

• Paddle pricing — https://www.paddle.com/pricing (5% + $0.50, no monthly fee; checked 11 Nov 2026)
• Lemon Squeezy fees docs — https://docs.lemonsqueezy.com/help/getting-started/fees (surcharges, $20 example, payout and marketing fees; checked 11 Nov 2026)
• Creem pricing — https://creem.io/pricing (3.9% + $0.40, payouts 1st + 15th; checked 11 Nov 2026)
• Paddle help, “Understanding Chargebacks with Paddle” and “When and how do I get paid?” (chargeback $20/$40, payout 1st → by 15th, min $100; checked 10 Nov 2026)
• Lemon Squeezy docs, “Getting paid” and “Refunds and chargebacks” (13-day hold, $50 minimum, $15 dispute fee; checked 10 Nov 2026)
• Gumroad pricing — https://gumroad.com/pricing (10% + $0.50 direct, 30% Discover, merchant of record since 1 Jan 2025; checked 10 Nov 2026)
• FastSpring pricing — https://fastspring.com/pricing (no published rate, custom quote; checked 10 Nov 2026)
• Gumroad processing (2.9% + $0.30) and volume tier ($20,000/month → 5% + $0.50): per Gumroad’s fees help article via multiple independent third-party reads, Oct 2026 — the volume tier is reported to roll out seller by seller, so it is stated here with that caveat, not as unconditional fact.

Disclaimer

This guide is general information, not tax, legal or financial advice. Fees were verified against the providers’ official pages on 10–11 November 2026 and can change; check the provider’s own pricing page before you commit. Worked examples use a US buyer paying by US card with no sales tax unless stated, and are rounded to the nearest cent. FastSpring’s rate is reported by reviewers, not published by FastSpring, and is labelled as such. Last verified: 11 November 2026.