How to invoice a client in another currency

Working with clients abroad raises questions a local invoice never does. Bill in your currency or theirs? What exchange rate? Who pays the fees when the money crosses borders? Settling these up front avoids short payments and awkward emails.

Choose the currency

• Your currency: you know exactly what you will receive; the client takes the exchange risk. Simple for you, slightly less attractive for them.
• Their currency: easier for the client to approve and pay, which can mean faster payment. You take the risk that the rate moves before payment.
• A major third currency such as US dollars or euros, common in international contracting, especially when neither side's currency is widely traded.

Agree the currency in the contract or quote, not on the invoice for the first time.

Show it unambiguously

The $ sign is used by the US, Canada, Australia, Singapore and many others. Use the three-letter currency code next to the total: “Total due: USD 2,400.00”. The Invoice Generator lets you choose the currency for the whole invoice, so every line and the total are formatted consistently.

Fees: who pays what

International bank transfers can carry fees from the sending bank, intermediary banks and the receiving bank, plus a margin on the exchange rate. Without an agreement, you may receive less than the invoice.

• Write the expectation on the invoice: “Please ensure all bank charges are paid by the sender so that the full amount is received.”
• For SWIFT transfers, the “OUR” charge option means the sender pays all fees; “SHA” splits them; “BEN” puts them all on you.
• Multi-currency business accounts and payment services often cost less than traditional transfers. Compare total cost, including the rate margin, not just the fee.

The exchange rate

For a quote in their currency, convert your price with a current rate, then add a buffer for movement and fees. The Currency Converter uses daily reference rates, which are a fair mid-market benchmark; banks pay out at a less favourable rate. The guide to currency conversion and hidden fees explains the difference.

Payment details for abroad

• Your account name exactly as the bank holds it.
• IBAN, or account number and the relevant national code, and the bank's SWIFT/BIC code.
• The bank's name and address.
• Ask the client to quote the invoice number as the payment reference.

Tax and records

Your own tax records usually need amounts in your home currency, converted at an accepted rate, typically the rate on the invoice date or the date paid, depending on local rules. If you charge VAT or GST, the rules for foreign clients differ: services to businesses abroad are often outside your country's VAT, with a note on the invoice. In the UK, for example, a VAT invoice issued in another currency must also show the VAT amount in sterling. Check with an accountant for your situation.

When payment arrives short

Record what you actually received and the fee that was deducted. If the shortfall broke your terms, raise it politely with the next invoice. Small, consistent shortfalls are a sign to agree the fee arrangement more clearly or change payment method.