Lemon Squeezy vs Payhip (2026): Fees, Tax Handling, and Which to Pick
Both take a cut of each sale. The difference is who carries the tax work.
Pick Lemon Squeezy when you sell to many countries and want the platform to act as merchant of record for sales tax. Pick Payhip when lower fees on small sales matter more and you are comfortable with how far its tax handling goes for your market.
Fees side by side
On a narrow screen, swipe the table sideways to see every column.
| Plan | Monthly | Platform fee | Fee on a $20 sale |
|---|---|---|---|
| Lemon Squeezy | $0 | 5% + $0.50 | $1.50 |
| Payhip Free | $0 | 5% | $1.00 |
| Payhip Plus | $29 | 2% | $0.40 |
| Payhip Pro | $99 | 0% | $0 |
Payhip says PayPal and Stripe charge their standard processing on top. Lemon Squeezy lists 5% + 50¢ per transaction and notes that some international transactions may carry small extra fees; check its fee documentation for your case.
The real difference: tax
- Lemon Squeezy says it is your merchant of record, handling sales tax and VAT calculation, collection, and filing.
- Payhip says it collects and pays digital EU/UK VAT and US/Canadian sales tax on your behalf. Check your responsibilities for any other place you sell to.
What you keep: US vs international buyers
Lemon Squeezy’s fee includes card processing but adds 1.5% for buyers outside the US. Payhip charges 5% plus Stripe processing (2.9% + $0.30), and Stripe adds 1.5% for international cards.
| Price | Lemon Squeezy, US card | Payhip Free, US card | Lemon Squeezy, non-US card | Payhip Free, non-US card |
|---|---|---|---|---|
| $10 | $9.00 | $8.91 | $8.85 | $8.76 |
| $20 | $18.50 | $18.12 | $18.20 | $17.82 |
| $50 | $47.00 | $45.75 | $46.25 | $45.00 |
Per sale, Lemon Squeezy keeps a little more than Payhip Free everywhere. The picture flips once you sell enough to pay for a Payhip plan.
Where a paid Payhip plan beats Lemon Squeezy
Payhip Pro ($99/mo) removes the 5% fee, so you pay only Stripe’s 2.9% + $0.30. Against Lemon Squeezy’s 5% + $0.50, that saves 2.1% + $0.20 on every sale.
| Price | Saved per sale on Payhip Pro | Sales a month to cover $99 | Monthly revenue at break-even |
|---|---|---|---|
| $10 | $0.41 | about 242 | about $2,420 |
| $20 | $0.62 | about 160 | about $3,200 |
| $50 | $1.25 | about 80 | about $4,000 |
Below those lines, Lemon Squeezy or Payhip Free costs less. Above them, Payhip Pro does. Run your own price in the fee calculator.
Payouts and the fine print
- Payhip deposits each sale straight to your PayPal or Stripe account right after the transaction.
- Lemon Squeezy pays out to your bank or PayPal. US bank payouts are free; non-US bank payouts cost 1%; PayPal payouts cost $0.50 (US) or 3% capped at $30 elsewhere.
- Lemon Squeezy extras: +1.5% for PayPal checkouts, +0.5% on subscription payments, and +5% on sales recovered by abandoned-cart emails.
- Lemon Squeezy is changing: it has announced a move toward Stripe Managed Payments, with no new fee published yet. Payhip’s pricing has no such change announced.
Which one to choose
- Selling mostly to one country, small prices, cost-sensitive → Payhip Free. Compare Payhip plans (affiliate link).
- Selling worldwide and you want tax off your plate → Lemon Squeezy.
- Already above about $967 a month on Payhip → Payhip Plus beats the free plan; see the break-even math.
Sources. Lemon Squeezy pricing, Payhip pricing. Prices change; check before you sign up. Related: Gumroad alternatives for small creators.
Thinking of leaving Lemon Squeezy? See Lemon Squeezy alternatives for 2026, including what is confirmed about the move to Stripe Managed Payments.
Who handles the tax? Compare which platforms collect and pay sales tax and VAT for you.
For low-priced downloads, the fixed $0.50 fee matters most. See fees on $1 to $5 products.
Choosing between the two? See Gumroad vs Lemon Squeezy for the fee on every sale side by side.
Also considering a subscription store? Read Sellfy vs Payhip to see when a flat monthly plan pays off.
For a line-by-line look at what Lemon Squeezy takes, see Lemon Squeezy fees: every fee, and what you keep from each sale.
Run your own numbers: try the free digital product fee calculator.
FAQ
Is Lemon Squeezy cheaper than Payhip?
Per sale, slightly: on a $20 US card sale you keep $18.50 on Lemon Squeezy and $18.12 on Payhip Free. Once you sell around $3,200 a month at $20, Payhip Pro becomes cheaper.
Which one handles sales tax?
Lemon Squeezy is merchant of record and handles sales tax and VAT worldwide. Payhip collects and remits EU and UK VAT for you.
Does Lemon Squeezy charge more for international buyers?
Yes, 1.5% more for buyers outside the US and 1.5% more for PayPal checkouts.
How fast do I get paid on Payhip?
Payhip deposits each sale to your PayPal or Stripe account immediately after the transaction.
Is Lemon Squeezy shutting down?
No shutdown has been announced, but Lemon Squeezy has announced a move toward Stripe Managed Payments without publishing the new fees.
Not sure which platform fits your numbers? Put in your price and monthly sales and see what you keep on every platform at once. If you are just starting, a Payhip store costs $0 until you sell, so you can set it up first and decide later.
Compare my numbers →Start a free Payhip store