Payhip vs Lemon Squeezy for Digital Products: Fees, Tax and Payouts Compared

Payhip and Lemon Squeezy are the two creator checkouts people most often weigh once they've decided Gumroad's 10% is too much. Both host your file, take the payment, deliver the download and deal with sales tax for you, and neither charges a monthly fee to start. The differences are in how the fee is built, how you get paid, and what happens to the fee as you grow.

The short answer

• Lemon Squeezy keeps slightly more on most US card sales from $10 up, because its 5% + 50¢ already includes card processing.
• Payhip's free plan is cheaper on very small sales (around $5), and at high volume (around $3,500 a month in sales at a $27 price) its paid plans get cheaper than Lemon Squeezy.
• Payhip pays you straight away through your own Stripe or PayPal account. Lemon Squeezy pays out from its balance, with payout fees outside the US.

What you keep at five prices

US card payment, no tax, per sale. Payhip rows include Stripe's US rate of 2.9% + 30¢ (or PayPal's US PayPal Checkout rate of 3.49% + $0.49) on top of Payhip's own fee:

Payhip Plus costs $29 a month on top of the per-sale numbers shown, so it only wins once your monthly sales cover that. Lemon Squeezy adds 1.5% for buyers outside the US and another 1.5% for PayPal payments. To run your own price and buyer mix, use the free Lemon Squeezy fee calculator and Payhip fee calculator, or see both next to Stripe, Etsy and Gumroad in the platform fee comparison.

How the fees are built

Lemon Squeezy: 5% + 50¢ per transaction, with card processing included and no monthly fee. Its fee docs say the percentage is charged on the total order value, including tax. Extras: +1.5% for buyers outside the US, +1.5% for PayPal, +0.5% on subscription payments, +3% on affiliate referrals and +5% on payments its abandoned-cart emails recover. For products under $10, it says to contact its sales team for custom pricing.

Payhip: three plans with the same features. Free Forever is $0 a month + 5%, Plus is $29 a month + 2%, and Pro is $99 a month with no transaction fee. Stripe or PayPal charge their standard processing fees on top, on every plan.

The upgrade math on Payhip only depends on its own fee, because processing is the same on every plan: Plus beats Free above about $967 a month in sales, and Pro beats Plus above $3,500 a month.

Sales tax and VAT

Lemon Squeezy is a merchant of record: it's legally the seller and handles sales tax and VAT on your sales. Payhip says it collects, reports and remits EU/UK VAT and US/Canadian sales tax on your behalf on digital sales. Either way, you're still responsible for income tax on what you earn. This isn't tax advice.

Getting paid

Payhip says it deposits each sale immediately into your connected Stripe or PayPal account, so there's no Payhip payout schedule to wait for. Lemon Squeezy collects the money and pays you out: per its fee docs, payouts to a US bank through Stripe are free, payouts to a non-US bank cost 1% per payout, and PayPal payouts cost $0.50 (US) or 3% capped at $30 (outside the US).

Which to start with

1. Selling mostly under $10? Payhip's free plan with card payments keeps a little more at around $5, and Lemon Squeezy asks sub-$10 sellers to contact sales.
2. Selling at $10 to $50 to mostly US buyers? Lemon Squeezy keeps about 30¢ to $1 more per sale than Payhip's free plan.
3. Expecting several thousand dollars a month? At a $27 price, Payhip Plus or Pro starts keeping more than Lemon Squeezy at around $3,500 a month in sales (about 130 sales). Below that, Lemon Squeezy's lower per-sale fee wins on US card sales.
4. Want the money in your own Stripe or PayPal account the minute you sell? Payhip.

Neither brings you buyers the way Etsy search can; you'll send every visitor yourself. If that's the hard part, how to get your first sale without an audience covers where first buyers come from, and Gumroad vs Lemon Squeezy vs Payhip adds Gumroad to the comparison.

FAQ

Is Payhip or Lemon Squeezy cheaper? On a $27 US card sale, Lemon Squeezy keeps about $25.15 and Payhip's free plan about $24.57. At $5, Payhip's free plan keeps slightly more ($4.30 vs $4.25). Payhip Plus beats Payhip's free plan above about $967 a month in sales, but at a $27 price it only beats Lemon Squeezy at around $3,500 a month.

Do both handle VAT? Lemon Squeezy is the merchant of record and handles sales tax and VAT. Payhip says it collects and remits EU/UK VAT and US/Canadian sales tax for you on digital sales.

Can I switch later? Yes. Both sell from a product page link, so moving mostly means re-uploading your files and changing the links you've shared. Keep your buyer list so you can tell past buyers where updates live.

Weighing Lemon Squeezy against a plain Stripe checkout instead? See Lemon Squeezy vs Stripe.

Sources (checked October 27, 2026)

• Lemon Squeezy pricing and Lemon Squeezy fees docs
• Payhip pricing
• Stripe US pricing and PayPal US merchant fees