Stripe is not officially available in Sri Lanka. But many Sri Lankan founders, freelancers, and SaaS builders successfully use US Stripe accounts legally as non-residents.

This guide explains exactly how Sri Lankans can get Stripe, step by step, including taxes and compliance.

What You Need Before Starting

To open a US Stripe account as a Sri Lankan, you need:

• Sri Lankan Passport
• US Address (can be virtual)
• US Phone Number
• A Website with:
  • Privacy Policy
  • Refund Policy
  • Terms & Conditions
• A US Bank Account (Payoneer / Wise)

Stage 1 – Get an EIN (US Tax ID)

An EIN (Employer Identification Number) is a unique tax identification number issued by the US Internal Revenue Service (IRS), used to identify your business for tax and reporting purposes — much like a tax ID for non-residents. You can apply for an EIN by completing Form SS-4, the official IRS application form. You can download the form and learn more on the IRS website here: About Form SS‑4 (IRS).

As a Sri Lankan, you use this form to request your EIN even if you don’t have a US Social Security Number (SSN) or ITIN

Option 1 – Call IRS (Fastest)

You can obtain your EIN quickly by calling the IRS directly using the following number:

During the call, an IRS officer will ask you a few basic questions about your business and personal details. You will then be asked to fax your completed Form SS-4 while on the call. Once the form is received and verified, your EIN is usually issued immediately.

Option 2 – Fax Method

If you prefer not to call, you can apply for your EIN by faxing your completed Form SS-4 directly to the IRS. Once the form is sent, you will typically receive your EIN within 4–5 working days.

You can use online fax services such as Fax.plus to send the form internationally without needing a physical fax machine, making this method simple and convenient for applicants in Sri Lanka.

Stage 2 – Create Stripe Account

Now go to stripe.com and:

1. Choose United States
2. Enter:
   • US address
   • EIN
   • Passport details
3. Do phone verification
4. Scan QR and upload passport if asked

Stripe may do KYC video verification.

Stage 3 – Get a US Bank Account

Stripe requires a US bank.

You can use:

• Payoneer
• Wise (Borderless account)

They provide:

• US routing number
• Account number

Link this to Stripe.

Important Warning (Read This)

Stripe has very strict risk and compliance systems, and dropshipping businesses are quickly flagged. If detected, Stripe can freeze your funds, permanently ban your passport, and prevent you from opening future accounts. In most cases, this happens within 30 days of starting operations.

Stripe is best suited for legitimate, low-risk online businesses such as SaaS products, freelancing services, digital products, consulting, and subscription-based platforms.

US Taxes for Sri Lankans Using Stripe

As a Sri Lankan using Stripe, you are classified as a Non-Resident Alien (NRA) for US tax purposes. This means you are taxed only on income that originates from US sources, and not on income earned from customers outside the United States.

Part 1 – Types of Income

1. Effectively Connected Income (ECI)

Effectively Connected Income (ECI) refers to income that is directly connected to business activities conducted in the United States. This includes income earned from a US-based business, US clients, or work physically performed in the US. Such income is subject to standard US income tax rates, which generally range from 10% to 37%, depending on the amount earned and your overall tax situation.

2. FDAP Income

FDAP income refers to passive income such as dividends, royalties, interest, and rent earned from US sources. By default, this type of income is subject to a 30% withholding tax in the United States. However, since Sri Lanka has a US tax treaty, this rate can be reduced to between 0% and 15%, depending on the income type. To benefit from this reduced tax rate, you must submit Form W-8BEN to Stripe before receiving payments.

Part 2 – Federal vs State Tax

In the United States, there are two main types of taxes that you need to understand: Federal Tax and State Tax. Federal tax is collected at the national level and applies across the entire country, while state tax depends on the specific state in which your business is registered or operates.

Federal Tax

Federal tax is managed by the Internal Revenue Service (IRS) and is mandatory for anyone who has US tax obligations, including non-residents who earn income from US sources.

State Tax

State tax obligations vary depending on the state in which your business is registered or considered to be operating. Some US states do not charge individual state income tax, making them especially attractive for non-resident founders. The most popular no-income-tax states include Florida, Texas, Wyoming, Nevada, Alaska, South Dakota, and Tennessee. Choosing one of these states can significantly reduce your overall tax burden and compliance costs.

Franchise Tax (LLC Owners)

If you register a US LLC, you must pay:

This is even if you make $0.

Part 3 – Simple Tax Rules

Case 1: Only EIN + No US Income

If you only have an EIN and do not earn any income from US sources, then you are not required to pay any federal or state taxes. In this case, there is no tax filing obligation with the IRS.

Case 2: EIN + US Income

If you have an EIN and you earn income from US sources, you must file Form 1040-NR to report your income to the IRS. Your tax liability will depend on the amount earned and the applicable tax rates.

Case 3: US LLC (Foreign Single-Member Owner)

If you own a US LLC as a foreign single-member owner, you are required to file Form 5472 along with a Pro Forma Form 1120 every year. This is mandatory even if the LLC made zero income, and failure to file these forms can result in significant penalties and interest.

Part 4 – How to File Taxes

You can file your US taxes either by using online tax software or by submitting the forms manually through postal mail. Popular tax software platforms for non-residents include Sprintax, MyExpatTaxes, eFile, and Instafill, which guide you step by step through the process. Alternatively, if you prefer to file manually, you can complete the required IRS forms, print them, and mail them directly to the IRS addresses provided.

For 1040-NR:

For LLC (5472 + 1120):

Final Truth About Stripe for Sri Lankans

In simple terms:

When Should You Create an LLC?

You should consider creating a US LLC when you start making around $3,000 or more per month, or when you want to build better business credibility, access safer and more reliable banking, and make it easier to scale your operations internationally. Until you reach that level, having just an EIN is usually sufficient for most Sri Lankan founders and freelancers.

Official IRS Resource

Learn more: irs.gov/individuals/international-taxpayers/nonresident-aliens