When you start out I wouldn't form a company until you have revenue . . . once you grow your SaaS to a few hundred dollars of recurring revenue it's time to form an LLC. <$500 in most states.
You could form one right away if you feel your SaaS is at risk for a lawsuit or you have a large amount of assets . . . but typically waiting till you have signups and regular revenue is recommended.
I did check out stripe. Maybe this is something I should have added in Q. I don't live in US though I am building the app for customers in US and Stripe is not supported from where I am.
To prove your idea you can use paypal . . . the api isn't as nice put it's a great start to prove your idea/app.
I would recommend automating signup so that is seamless . . . but you could have your backend email you for cancelations, etc and do those manually through paypal.
In the beginning keep things simple and be willing to do things manually behind the scenes to keep time/costs low till you have signups and users getting value out of your app that will be subscribers long term.
If you go with PayPal I'd recommend only using their free services (e.g., the "subscribe button") or going with BrainTree (https://www.braintreepayments.com) which is also free and a nicer way to integrate PayPal than their paid APIs.
Payflow Pro by PayPal ($30/mo) is ridiculously complex and it's better to buy an additional 3rd-party service built on top to make it easier (you'd end up paying $100+/month plus 2.9%).
Thanks for the pointer. What I really wanted to understand was do you need to have an incorporated company to offer a simple subscription service or you can offer it as an individual
You can offer it as an individual but it is quite cheap to incorporate your company and it can save you from losing your shirt if your company ever makes a mistake.
If you are a lone young man/woman with no kids, no house, and few assets, I wouldn't worry about it right now. If you have $10k+ net worth, it really wouldn't hurt to set up a company. It costs a few hundred bucks and takes a weekend of reading or a short consultation with a lawyer and an accountant.
Also note that it will cost more to incorporate later once your business already has traction.
For SaaS . . . use Stripe.com for payments.
When you start out I wouldn't form a company until you have revenue . . . once you grow your SaaS to a few hundred dollars of recurring revenue it's time to form an LLC. <$500 in most states.
You could form one right away if you feel your SaaS is at risk for a lawsuit or you have a large amount of assets . . . but typically waiting till you have signups and regular revenue is recommended.
Listen to: http://StartupsForTheRestOfUs.com
read/listen to everything by patio11
Good luck in 2015.