Paddle

What it is

Think of a shop of record that handles the receipt and the taxes on every sale, so you only supply the product. That is an "MoR (Merchant of Record)": the company that is legally the one selling to your customer and takes care of the paperwork. Paddle is that, aimed at software and SaaS (Software as a Service, software you rent monthly instead of buying) businesses. Like other MoR services, Paddle is legally the seller: it processes the payment and then handles global sales tax, VAT (Value Added Tax, a sales tax used in many countries), and GST (Goods and Services Tax, the same kind of sales tax in countries like Australia and India) compliance for you, including filing and paying it. On top of payments it offers subscription billing, invoicing, and revenue tooling, so it positions itself as a complete "payments + tax + billing" layer for software companies.

Strengths

• Merchant of record: worldwide tax registration, collection, and remittance are Paddle's job, not yours.
• Strong subscription and recurring-billing features — plans, trials, proration, dunning.
• Handles invoicing and B2B (business-to-business, selling to other companies) sales flows, not just consumer one-off purchases.
• Reduces compliance and chargeback overhead as you scale internationally.

Trade-offs

• Fees are higher than a bare processor, reflecting the tax and compliance work it absorbs.
• Less low-level control over the exact checkout flow than building directly on Stripe.
• Approval and onboarding can be stricter, since Paddle takes on the seller's liability.
• Best fit is software/SaaS; not designed for physical goods or marketplaces.

Best for

SaaS and software companies — especially those selling internationally — that want billing and global tax compliance handled together so the team can focus on the product instead of VAT filings across many countries.

Vibe coding fit

Paddle suits vibe coding when you're building a subscription product and want to avoid the tax-compliance rabbit hole entirely. Point the agent at Paddle's hosted or overlay checkout and have it implement the webhook that activates a subscription and the one that handles cancellations and renewals. A webhook is an automatic message Paddle sends your app when something happens (a new subscription, a cancellation), so your app reacts on its own instead of constantly polling. Because Paddle is the merchant of record, tell the agent not to build any tax logic — its job is fulfillment and keeping your app's subscription state in sync with Paddle's events.

// Handle a Paddle subscription webhook (server-side)
export async function handlePaddleEvent(event) {
  switch (event.event_type) {
    case "subscription.activated":
      await grantAccess(event.data.customer_id);
      break;
    case "subscription.canceled":
      await revokeAccess(event.data.customer_id);
      break;
  }
}