Getting paid across borders is more complex than domestic invoicing — different VAT rules apply, currencies fluctuate, and missing a legal mention can make the invoice unacceptable to your client's accounting team. Here's a practical breakdown of everything that changes when your client is in another country.
The first question: where is your client, and are they a business?
Two variables determine almost everything about a cross-border invoice:
- Location of the client: same country, EU, or outside EU
- Type of client: business (B2B) or individual (B2C)
These two factors determine whether you charge VAT, which rate applies, and which legal mentions are required.
EU B2B: the reverse charge mechanism
If you're based in the EU and invoicing a VAT-registered business in another EU member state, the reverse charge mechanism applies:
- You do not charge VAT on the invoice
- The client self-reports and pays VAT in their own country
- Your invoice must include:
- Your VAT number
- The client's VAT number
- The mention: "Reverse charge — VAT to be accounted for by the recipient" (or equivalent in your language)
Example: A French consultant (VAT number FR12345678901) invoices a German GmbH (DE987654321) for €5,000. The invoice shows €5,000 with 0% VAT and the reverse charge mention. The German company declares the €5,000 as output VAT on their own return.
You can verify EU VAT numbers for free at the VIES system before invoicing.
EU B2C: charge VAT at the client's rate
If you're selling services to individuals (non-business) in other EU countries, the rules differ — especially after the EU's 2021 OSS (One Stop Shop) reform:
- For most digital services (software, online courses, downloadable content): VAT at the consumer's country rate applies, even for small amounts. You can use the OSS system to report all EU VAT centrally.
- For most professional services (consulting, design, copywriting): VAT of your country generally applies when dealing with private individuals outside major thresholds.
This area is complex. If you regularly sell to EU consumers, consult a tax adviser about OSS registration.
Outside the EU: generally no VAT
For services rendered to clients outside the EU (US, UK, Australia, Canada, Singapore, etc.):
- Most service providers are not required to charge VAT on these exports
- Your invoice should mention: "VAT exempt — export of services" or "Service outside the scope of VAT"
- You still declare the revenue in your local accounting
Note for UK-based suppliers post-Brexit: services exported from the UK to EU clients follow UK VAT rules, not EU rules. The UK has its own reverse charge regime for certain B2B cross-border supplies.
Which currency to use?
You can invoice in any currency — the question is which works best for you and your client.
Invoice in your own currency
- Simplest for your accounting
- Client bears the currency risk
- May cause friction with clients used to dealing in their own currency
Invoice in the client's currency
- Client pays in their native currency (less friction)
- You receive a variable amount in your currency
- You must record the invoice at the exchange rate on the invoice date
Invoice in a neutral currency (USD, EUR)
- Common for international freelancers
- USD is the default for tech and digital services globally
- EUR is common for European cross-border work
Practical tips
- Lock the exchange rate in the contract if working on a long project
- Record the local-currency equivalent on your invoice (or in your accounting) at the invoice date rate
- Use your bank's rate or a reference rate (ECB, XE.com) for consistency
Payment methods for international clients
Bank transfers are the norm for B2B, but SWIFT transfers incur fees on both ends. Alternatives:
| Method | Best for | Notes | |---|---|---| | SEPA transfer | EU clients | Free within the eurozone | | SWIFT / Wire | All countries | Fees typically $15–$40 per transfer | | Wise (formerly TransferWise) | Any currency | Lower fees than SWIFT for most routes | | PayPal | Small amounts | High fees (3–4%+), avoid for large invoices | | Stripe | Recurring B2B | Easy to integrate, fees ~1.4–2.9% | | Crypto | Tech-savvy clients | Volatile, complex accounting |
Always include your IBAN and BIC/SWIFT code on cross-border invoices. For US clients, include your bank routing number and account number if they prefer ACH.
Required legal mentions for international invoices
An international invoice should include everything a domestic invoice requires, plus:
- Your VAT number (if VAT-registered)
- Client's VAT number (for EU B2B)
- Reverse charge mention (for EU B2B)
- Currency clearly stated on all amounts
- Exchange rate reference if dual currency is displayed
- INCOTERMS (for physical goods only: EXW, CIF, FOB, etc.)
- Country of origin (for goods crossing customs)
What about US clients specifically?
US businesses generally expect:
- Invoice in USD (or the agreed project currency)
- No VAT (US doesn't have VAT; you'd exempt it as an export)
- Payment by ACH, wire, or check
- Mention of your W-8BEN if you're a non-US person receiving US-sourced income — though for most service contracts, this isn't required on the invoice itself
Common mistakes to avoid
- Charging your domestic VAT rate to a foreign B2B client: incorrect — use reverse charge or exemption
- Forgetting the client's VAT number on EU B2B invoices: your invoice won't be deductible for them
- Using today's exchange rate when invoicing in a different currency from your accounting: always use the date-of-invoice rate
- Sending invoices in a format the client can't process: always use PDF, with full legal mentions
Invoice Creator for international invoicing
Invoice Creator detects the client's country and automatically applies the correct VAT treatment — reverse charge for EU B2B, VAT-exempt for outside EU, and standard rate for domestic. The reverse charge mention is added automatically when you enter the client's foreign VAT number.
Multi-currency support lets you invoice in EUR, USD, GBP, CHF and more, with optional display of the local-currency equivalent. Useful for freelancers who work with clients across multiple countries and need consistent, compliant invoices without manual adjustments per country.