The Digital Markets Act gave EU iOS founders more than one path. Keep Apple IAP and pay 15 to 30%. Use an in-app external purchase link and pay roughly 10 to 20% to Apple. Qualify as a reader app and pay 0%. Or take the purchase entirely to the web with Web2App and pay Apple nothing. The Apple fee on each path is straightforward. What most comparisons skip is the cost that comes after it: VAT, chargebacks, refunds, and payment processing, which land on you the moment you step outside Apple's billing system.
That is where most comparisons stop. This piece goes further: it builds the full cost stack for each path, including payment processing, VAT, and disputes, and runs a worked example on a EUR 20 per month EU subscription so the numbers reflect what you actually keep.
The three paths, side by side
Path | Apple fee | You become seller of record? | What that adds |
|---|---|---|---|
Apple IAP | 15% to 30% | No | Nothing. Apple handles it all. |
In-app external purchase link | 10% to 20% (EU, Tier 1 or 2) | Yes | Payment processing, VAT, disputes |
Web2App | 0% | Yes | Payment processing, VAT, disputes |
The Apple fee is the part everyone quotes. What you owe on top of it is the part that determines whether the math actually works.
What Apple charges on each path
Apple IAP charges 15% if you qualify for the Small Business Program (under one million USD in annual proceeds) or if a subscription has passed its first year. Everyone else pays 30%.
In-app external purchase link (EU) splits into two tiers. Apple calls them Store Services Tier 1 and Tier 2.
Tier 2 is the default. It includes App Store discovery, search featuring, personalized recommendations, ratings and reviews, and developer analytics. The fee stack on an external link under Tier 2 runs roughly 18 to 20%: a 2% initial acquisition fee, 13% store services fee (10% reduced rate), and a 5% Core Technology Commission.
Tier 1 drops discovery and marketing from Apple's side. The store services fee falls to 5%, bringing the total to roughly 10 to 12%. Apps that run their own acquisition funnel and do not rely on App Store search can qualify for Tier 1. Tier 2 is the default, developers can apply to be downgraded to Tier 1 once per quarter
There is also a second addendum path: the Alternative Terms Addendum under the Digital Markets Act. Under this addendum, the 5% Core Technology Commission is replaced by the Core Technology Fee, a flat 0.50 EUR per first annual install above one million. For an app under one million installs, that fee is zero. Which addendum is cheaper depends on your install volume and is a legal and finance call, not just a math one.
Web2App costs Apple nothing. The purchase happens on the web, no in-app link is involved, and Apple's fee framework does not apply. No entitlement, no disclosure sheet, no transaction reporting to Apple.
What you pay on top of Apple's fee
When you move off Apple IAP, Apple stops being your merchant of record. You are. That shifts three cost lines onto your stack.
Payment processing. Stripe's standard rate for an EEA-based account is 1.5% plus 0.25 EUR for European cards, 2.5% plus 0.25 EUR for UK cards, and 3.25% plus 0.25 EUR for non-EEA international cards. Those are the base rates. They exclude tax and dispute handling.
VAT. In the EU, digital services are taxed in the buyer's country. If you sell to a customer in Germany, you collect and remit German VAT. France, French VAT. Across the EU that means up to 27 different rates, registrations, and filing schedules. If you are not already VAT-registered in each relevant jurisdiction, you either register in each country or use the OSS (One Stop Shop) scheme in one EU country to file for all of them. Either way, the compliance burden lands on you unless someone else carries it.
Chargebacks and disputes. Under Apple IAP, Apple eats this. Under an external path, you do. The actual loss rate varies by product and audience, but 0.5% to 1% of revenue is a reasonable baseline for a subscription SaaS.
Worked example: EUR 20 per month EU subscription
Take a founder charging EUR 20 per month to an EU subscriber. Here is what each path costs per transaction at mid-2026 rates.
Apple IAP (standard rate)
Apple fee: 30% = EUR 6.00
Tax, disputes, processing: Apple handles
Net to founder: approximately EUR 14.00
Apple IAP (Small Business Program)
Apple fee: 15% = EUR 3.00
Net to founder: approximately EUR 17.00
In-app external link, Tier 2
Apple fee (approx. 18 to 20%): EUR 3.60 to EUR 4.00
Stripe processing (European card): EUR 0.55 (1.5% + 0.25)
VAT remittance and compliance: varies, plus filing overhead
Dispute reserve: roughly EUR 0.10 to EUR 0.20
Net to founder (before VAT accounting): roughly EUR 15.80 to EUR 16.25
In-app external link, Tier 1
Apple fee (approx. 10 to 12%): EUR 2.00 to EUR 2.40
Stripe processing: EUR 0.55
VAT and disputes: as above
Net to founder (before VAT accounting): roughly EUR 17.20 to EUR 17.80
Web2App, DIY stack
Apple fee: EUR 0
Stripe processing: EUR 0.55
VAT compliance: time and overhead, plus potential penalties for errors
Dispute reserve: EUR 0.10 to EUR 0.20
Net to founder (before VAT accounting): roughly EUR 19.00 to EUR 19.25
Web2App via merchant of record
This is where the comparison gets real. A merchant of record takes the seller-of-record liability and folds in payment processing, VAT, and disputes into one rate. You pay one number; they handle the rest.
tiun, for example, quotes an all-in rate of approximately 3.4% plus EUR 0.30 on an international subscription. On EUR 20 that is roughly EUR 0.98, for a net of approximately EUR 19.02. That figure includes VAT handling and dispute coverage, which the DIY Stripe calculation above does not.
The gap between Web2App DIY and Web2App via a merchant of record is not as large in percentage terms, but the DIY route carries operational exposure that does not show up in a per-transaction calculation: VAT penalties, dispute losses, and the engineering time to build and maintain compliance tooling.
Where the MoR all-in rate lands versus DIY
A table summary, EUR 20 subscription, mid-2026:
Path | Apple cut | Full stack cost | Net retained |
|---|---|---|---|
Apple IAP (standard) | EUR 6.00 | EUR 6.00 | ~EUR 14.00 |
Apple IAP (Small Business) | EUR 3.00 | EUR 3.00 | ~EUR 17.00 |
External link, Tier 2 | EUR 3.60 to 4.00 | EUR 4.50 to EUR 5.00 | ~EUR 15.50 to 16.00 |
External link, Tier 1 | EUR 2.00 to 2.40 | EUR 3.00 to EUR 3.50 | ~EUR 16.50 to 17.00 |
Web2App, DIY | EUR 0 | EUR 1.00 to EUR 1.50+ | ~EUR 18.50 (pre-VAT risk) |
The headline takeaway: Web2App via a merchant of record clears the most per transaction. The trade-off is that you are responsible for acquisition and retention without App Store discovery infrastructure. That is a growth question, not a cost question, and a different article covers it.
The US footnote
In the United States, Apple currently allows external payment links in iOS apps at 0% commission following the court ruling in the Epic v. Apple case. That 0% applies to the Apple fee only. Payment processing, VAT (US sales tax), and dispute costs still land on you. The EU Tier 1 and Tier 2 structure does not apply to US apps. Date this: the US rules are under active litigation and enforcement, and the terms may change.
Frequently asked questions
Does switching from Apple IAP to Web2App mean I lose the Small Business Program rate?
Yes. The Small Business Program rate of 15% applies only to Apple IAP transactions processed through StoreKit. Once a purchase moves outside Apple's payment system, whether through Web2App or an external link, Apple's fee drops to zero but you also lose the SBP discount on those transactions. If you run a hybrid model where some purchases go through IAP and some through Web2App, the SBP qualification is based on total App Store proceeds across all your apps, not the payment method used.
What is the difference between Tier 1 and Tier 2 for in-app external purchase links, and how do I qualify for Tier 1?
Tier 1 and Tier 2 reflect how much of Apple's distribution and marketing infrastructure you use. Tier 2 is the default: it bundles App Store search placement, featured recommendations, editorial coverage, and ratings infrastructure, and Apple charges accordingly (roughly 18 to 20% all-in). Tier 1 strips those services out and drops the store services fee to 5%, for a total of roughly 10 to 12%. If your main acquisition channel is not App Store search or featuring, you can apply for Tier 1 through App Store Connect. Apps running paid social or organic web acquisition outside the App Store are strong candidates. Tier 2 is the default – you can apply to switch once per quarter
If I use a merchant of record for Web2App, am I still responsible for VAT in the EU?
No, not for the transactions the MoR processes. When a merchant of record handles your payments, they take on the seller-of-record status for those transactions. That means VAT collection, remittance to each EU member state, and filing obligations shift to them, not you. This is the core operational difference between using a payment processor like Stripe and using an MoR. Stripe processes the payment; you remain the seller and carry the VAT liability. An MoR takes on both. tiun operates on the MoR model, which is why the all-in rate in the worked example above already includes VAT handling rather than listing it as a separate line.
Do conversion rates actually differ between Apple IAP and a Web2App checkout?
In most categories, yes. Apple IAP benefits from stored payment credentials, Face ID or Touch ID authentication, and a checkout flow users already trust. Web2App introduces a browser redirect, a new checkout UI, and a re-entry of payment details for first-time purchasers. Published data on the gap varies widely by app category and audience, but a 10 to 20% lower conversion rate on Web2App is a commonly cited range among founders who have run the comparison. The fee saving on a EUR 20 subscription is real, but if one in seven potential subscribers drops off at checkout, the math can flip. This is why the cost comparison in this article is one input into the decision, not the whole decision.