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How to get paid by international clients from the US

By FastBuySale Newsroom · 9 Nov 2026 · 18m ago

Why international clients are different

Working with clients abroad widens your market, but getting paid involves more steps than a local payment. Currencies differ, banks charge for international transfers, exchange rates add hidden costs and some payment methods are not available in every country. There are also tax and reporting rules to know.

This guide sets out the process in numbered steps for US freelancers, consultants and small businesses. It uses the IRS's guidance on foreign currency and general information about payment methods. Fees and features change, so compare current terms before choosing.

Step 1: agree payment terms before you start

Put the key terms in writing, in a contract, proposal or the first invoice: the amount, the currency, the payment method, the due date, who pays transfer fees, and what happens if payment is late. For larger projects, consider a deposit before work starts and milestone payments as work progresses. Clear terms prevent the most common disputes.

Step 2: decide which currency to bill in

Billing in US dollars puts the exchange rate risk on the client, which is simpler for you, but some clients prefer to pay in their own currency. Billing in the client's currency can win work, but the dollar amount you receive can change between invoice and payment. If you bill in a foreign currency, agree whether the rate is fixed or based on the payment date.

Step 3: choose a payment method

Common options include international bank wires, which are widely accepted but carry fees from the sending and receiving banks and sometimes intermediary banks; payment platforms such as PayPal or Stripe, which are convenient for clients but charge percentage fees and currency conversion margins; multi-currency account providers, which give you local account details in several currencies and convert at lower margins; and freelance marketplaces, which handle payment for you but take their own fees. Choose based on what your client can use and what costs you least overall.

Step 4: compare the total cost

The fee is only part of the cost. The exchange rate margin, the difference between the rate you get and the mid-market rate, is often larger. To compare, look at how many dollars you would actually receive for the same foreign amount through each method. The percentage calculator on this site helps work out the difference as a percentage.

Worked example: comparing two methods

Ella invoices a client in Germany for 3,000 euros. Suppose the mid-market rate is 1.10 dollars per euro, giving $3,300. Option A, a bank wire, has a $15 receiving fee and her bank converts at 1.07, giving $3,210 minus $15, or $3,195. Option B, a multi-currency account, receives euros through local details at no fee and converts at 1.095 with a $10 fee, giving $3,285 minus $10, or $3,275. Option B leaves Ella $80 better off on one invoice. The figures are illustrations; check real rates and fees on the day.

Step 5: send a clear invoice

Include your name or business name and address, the client's details, a unique invoice number, the date, a description of the work, the amount and currency, payment instructions and the due date. For bank transfers, provide the correct account details, including SWIFT or BIC codes and any intermediary bank details your bank requires. Errors in bank details are a common cause of delays and returned payments.

Step 6: check payment arrives in full

When payment arrives, compare the amount with the invoice. Intermediary banks sometimes deduct fees along the way, so the amount can be lower than expected. If your terms say the client pays all fees, raise any shortfall promptly and politely.

Step 7: watch for scams

International payment scams aimed at freelancers are common. Warning signs include clients who overpay and ask you to send back the difference, cheques from unknown foreign businesses, requests to pay a fee before receiving funds and pressure to use unusual payment methods. The FTC warns that fake checks can bounce days after your bank makes funds available, leaving you responsible for the full amount.

Step 8: convert income to dollars for tax

The IRS requires you to report income in US dollars. Generally, convert foreign currency at the exchange rate on the day you receive the payment, although the IRS also publishes yearly average rates that may be used in some circumstances. Use a consistent method and keep records of the rates used.

Step 9: report the income and pay tax

US citizens and residents are taxed on worldwide income. If you are self-employed, report the income on Schedule C, pay self-employment tax on net earnings of $400 or more and include the profit in your income tax. Foreign clients usually do not issue Forms 1099, so your own records are the basis for reporting. Because nothing is withheld, make quarterly estimated payments if you expect to owe $1,000 or more.

Step 10: understand foreign account reporting

If you hold money in financial accounts outside the US, such as a foreign bank account, and the combined value exceeds $10,000 at any time during the year, you may need to file an FBAR with the Treasury's Financial Crimes Enforcement Network. Some taxpayers with larger foreign assets also need Form 8938. Whether a particular multi-currency account counts as foreign depends on where it is held, so check the provider's information and the official guidance.

Contracts and governing law

For international work, your contract should state which country's law applies and how disputes will be resolved. Many freelancers choose their own state's law. Include clauses on late payment, intellectual property and confidentiality. For significant contracts, a lawyer's review can be worthwhile.

Sanctions and restricted countries

US law prohibits or restricts dealings with certain countries, entities and individuals under sanctions programmes administered by the Treasury's Office of Foreign Assets Control. Banks and payment providers screen transactions and may block payments. If a client is in a sanctioned country, check the rules before agreeing to any work.

Payment platform considerations

Payment platforms are convenient because many clients already use them, but terms vary. Some charge a percentage fee on received payments, a further margin when converting currency and a fee for withdrawing to a bank. Accounts can be held or limited if the platform's risk checks flag unusual activity, such as a sudden large payment. Read the platform's fee page and acceptable use policy, verify your account fully before large invoices arrive and avoid keeping large balances there for long periods.

Bank wires in practice

A wire is often the method larger corporate clients prefer. Your bank will give you incoming wire instructions, including a SWIFT code and possibly an intermediary bank. Ask your bank what it charges for incoming international wires and whether it converts foreign currency automatically. Some banks allow you to receive foreign currency into a dollar account at their own rate, while others offer foreign currency accounts. Sending these details accurately to your client avoids delays.

Getting paid on time

International late payments can be hard to chase. Reduce risk by requesting deposits for new clients, using milestone payments, setting clear due dates such as 14 or 30 days and stopping work if payments are significantly overdue. Polite reminders a few days before and after the due date are often enough. For persistent non-payment, collection agencies or legal action abroad can be costly, which is why upfront terms matter.

Worked example: estimating tax on foreign income

Raj, a self-employed developer in Texas, receives $40,000 from clients in the UK and Canada during 2026 and has $5,000 of expenses, leaving $35,000 profit. Texas has no state income tax. His self-employment tax is about 15.3% of 92.35% of $35,000, or roughly $4,945. He also owes federal income tax on the profit after deductions. He makes quarterly estimated payments and keeps a spreadsheet of each payment, the date received, the currency and the rate used to convert to dollars.

Common mistakes

- Not agreeing the currency or who pays fees.

- Looking only at the transfer fee and ignoring the exchange rate.

- Giving incomplete bank details on invoices.

- Forgetting to report foreign income because no 1099 arrived.

- Missing FBAR filing when foreign account balances pass $10,000.

A simple process to repeat

For each new client: agree terms, choose the method, send an invoice, check payment, record the dollar amount and rate, set aside tax and file reports as needed. This article is general information, is not tax, legal or financial advice and does not recommend any provider.

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