Nov '23 in Q&A
Tax in SaaS
Hey folks - let's talk tax!
Our SaaS plans are typically tax-inclusive. What you see is what you get; we absorb the tax and processing fees under COGS.
For our European/UK customers in particular though, absorbing the 20% VAT bill stings (vs. 10% sales tax in other countries).
Before we test it - would love to hear from you. How would you feel about purchasing a new subscription, if you - the customer - were asked to pay the sales tax on top of your plan? Would this be a deal breaker?
Alternatively, we could:
- Increase pricing for geo regions with higher tax rates
- Only make tax exclusive for geo regions with higher tax rates
We use Paddle for billing, for context.
Thoughts?
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Tax in SaaS
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