How to invoice a customer in another currency

To invoice a customer abroad: agree the currency before you start work, put the currency code on every amount on the invoice, and make sure your payment gateway can actually settle that currency. If you are registered for a sales tax, check whether your authority also requires the tax amount restated in your own currency — several do.

The mistakes here are rarely about the exchange rate. They are about ambiguity ("$" is at least six different currencies), about discovering at payment time that your gateway cannot accept the currency you invoiced in, and about who absorbs the conversion cost.

Which currency should you invoice in?

Three reasonable answers, in order of how often they are right for a small business:

Your own currency. Simplest for you: no conversion risk, no restatement, and your books need no adjustment. The customer bears the conversion. Reasonable for smaller amounts and where you have the stronger negotiating position.

The customer's currency. Easier for them, and often what wins the work — a price in their own currency reads as a real price rather than a quote to be checked. You take the conversion risk between invoicing and settlement.

A third currency, usually USD or EUR. Common in international trade where neither party wants the other's currency. Both sides convert; both sides can compare against a familiar benchmark.

Whichever you choose, agree it in writing before the work starts. Changing currency after an invoice is issued means a credit note and a fresh invoice, not an edit.

How do you show currency unambiguously?

Use the ISO 4217 code, not just the symbol. $1,000 could be US, Canadian, Australian, Singapore, Hong Kong or New Zealand dollars. USD 1,000 cannot.

Put the code in three places: beside the total, in the payment instructions, and in the invoice's own metadata if your tool records it. A finance team that has to guess will either ask, which costs you a week, or assume, which costs you the difference.

What about tax on a cross-border invoice?

This is where the real complexity lives, and it depends on what you supply and to whom:

• Business-to-business, cross-border, within a common tax area. Often a reverse charge: you charge no tax, the customer accounts for it, and the invoice must say so explicitly.
• Business-to-consumer, cross-border. You may be required to charge the tax of the customer's country, and possibly to register there. Digital services rules in particular are aggressive about this.
• Outside your tax area entirely. Usually outside the scope of your sales tax, but the invoice should still show why.

Some authorities require the tax amount to be restated in your local currency even when the invoice is denominated in another, at a published reference rate for the tax point date. Where that applies, the rate you used should appear on the invoice.

Who pays the conversion and transfer costs?

Someone always does, and if the invoice does not say who, it will be you — the customer sends the invoiced amount, the intermediaries take their cut, and you receive less than you billed.

State it. "All bank charges for the payer's account" is a normal clause. For card payments it is usually cleaner: the gateway converts at a known rate and you receive the invoiced amount in your settlement currency, net of the gateway's fee.

What if your gateway cannot settle the currency?

Then you cannot take a card payment in it, whatever the invoice says. This is worth checking before you agree a currency, not after.

A gateway typically supports a set of presentment currencies (what the customer sees) and a smaller set of settlement currencies (what lands in your account). Invoicing in a currency your gateway can present but not settle is fine — it converts. Invoicing in one it cannot present at all means the customer will be paying by bank transfer.

How this works here

Quantum Solutions Invoicing prices and settles in whatever currencies your own gateway supports, and you can hold per-currency credentials where your gateway needs them. The currency is set on the invoice and carried through to the payment, so what the customer is charged is what the invoice says. If your gateway cannot settle a currency, the checkout for that currency is simply not offered rather than failing at the payment step.

Frequently asked questions

Can I invoice a customer in a different currency from my own? Yes. Agree the currency in writing before the work starts, state the ISO code on every amount, and confirm your payment gateway can settle it.

Which exchange rate should I use on a foreign-currency invoice? For your own books, the rate at the tax point. Where a tax authority requires the tax amount restated in local currency, it usually specifies which published reference rate to use — check that before choosing your own.

Do I charge my local sales tax on a foreign invoice? It depends on what you supply and to whom. Cross-border business-to-business supply within a common tax area is often a reverse charge with no tax charged; consumer supply may require you to charge the customer's local rate and register there.

Who pays the bank charges on an international payment? Whoever the invoice says. If it says nothing, the charges typically come out of the amount you receive. "All bank charges for the payer's account" is a standard clause.

What happens if the exchange rate moves between invoicing and payment? Whoever's currency the invoice is not in bears that movement. If you invoice in your own currency you carry no risk; if you invoice in the customer's, you receive more or less than you expected in your own terms.