Getting Paid by a Client in Another Country

The short answer

A client in another country rarely refuses to pay. They are usually unable to, because something in their setup has no record of you yet. 4 things have to exist before money can move, and each has its own delay:

1. A tax form on file. US clients cannot release payment until they hold a W-9 or a W-8 from you.

2. Bank details their system accepts. The right identifiers for the route, not simply your account number.

3. An agreed currency, stated on the invoice and in the contract.

4. A decision about who pays the transfer fees, before the payment arrives short.

Sort all 4 during onboarding and a cross-border invoice behaves like a domestic one. Leave them to the first payment run and you add weeks, which is the same failure as invoicing without a purchase order number: the invoice is unpayable rather than disputed, and nobody tells you.

The form your US client needs before they can pay

US companies are required to document who they pay. Until the right form is on file, accounts payable will hold the invoice or release it with tax deducted. Which form depends on whether you are a US person, and it goes to the client, not to the IRS.

If you are US-based, return Form W-9 promptly, because the consequence of not doing so is financial. Where a payee does not furnish a correct taxpayer identification number, the payer is required to apply backup withholding, which the IRS sets at 24%. That is a quarter of your invoice held back over a missing form.

If you are outside the US, the form is Form W-8BEN-E for a company or W-8BEN for an individual. It certifies your foreign status to the withholding agent, which is your client. Send it at setup rather than waiting to be asked, because it is often the last thing anybody thinks of and the first thing that stops a payment.

The 30% question, and why it usually does not apply

Non-US suppliers sometimes see a client propose withholding 30% of an invoice. The rule behind it is real: NRA withholding requires 30% to be withheld on payments of US-source income to foreign persons, unless a lower rate applies under the tax code or a treaty between the US and your country.

The part that matters for an agency is what counts as US-source. For services, the IRS rule is that the place where the services are performed generally determines the source, regardless of where the contract was made, where payment is sent, or where the payer lives. A design studio in Lisbon doing the work in Lisbon is generally earning foreign-source income, even where every client is American.

So the usual answer for an agency working from its own country is that no US withholding applies, and the W-8 is what lets the client document why. Where you do send people to work in the US, part of the fee is allocated to those days, and that is the point to get proper advice rather than a blog. Treaty positions are also specific to your country and your circumstances.

Practically: return the W-8 early, and if a client still proposes to withhold, ask them to confirm with their own tax team what they believe the US-source element is. Most of the time the question has simply never been asked.

Bank details their system will accept

The second blocker is mundane. Each route wants different identifiers, and giving the wrong set produces a payment that fails quietly days later:

• US domestic, to a US account. Routing number and account number. Cheap and quick, and the default if you hold a US account.

• International wire. SWIFT or BIC code plus the account number, and an IBAN where your country uses one. Your bank's full name and address are often required as well.

• Euro payments inside Europe. IBAN and BIC, over SEPA.

• Payment platforms. Where the client uses a supplier portal, the bank details live in the portal and changing them later is deliberately slow.

Inside Europe this is easier than it looks. The European Commission describes SEPA as a single set of tools and standards that make cross-border payments in euro as easy as national ones, covering the EU plus 15 further countries and territories, the UK among them. A euro payment between 2 SEPA countries should behave like a domestic transfer, so a client quoting large fees for one is usually sending it the wrong way.

Send bank details in a structured form, not buried in an email, and put them on the invoice itself. Where a client asks you to change bank details by email, treat it as a fraud attempt until you have confirmed it by phone on a number you already had. Supplier payment fraud works precisely because this request looks ordinary.

Who pays the transfer fees

An international wire passes through intermediary banks, and each can take a cut. Which side absorbs that is set by a charge instruction on the payment, and there are 3 options in common use:

SHA is the default, which is why a $5,000 invoice arrives as $4,962. That shortfall is a bank fee rather than a dispute, and treating it as an underpayment wastes everyone's time. Decide how to handle it in advance: either ask for payments to be sent OUR, or accept the deduction and price it in.

Put the answer in the contract alongside your payment terms, in 1 line. Something like: payment to be made by bank transfer in US dollars, with all transfer charges borne by the client, so that the full invoice amount is received.

If short payments are frequent and small, following up each one costs more than it recovers. Add the expected fee to your rate for that client and stop counting.

Which currency to invoice in

Whoever invoices in a foreign currency carries the exchange risk, and whoever converts pays the spread. There is no universally right answer, so pick deliberately:

• Your own currency puts the risk and the conversion cost on the client. Cleanest for you, and larger clients usually accept it.

• The client's currency is easier to sell and common when you want the work. You then carry the rate movement between invoice and payment, which on 60-day terms can be a few percent.

• A major currency both sides use, often US dollars, is the usual compromise on international work.

Whichever you choose, state it in the contract and on every invoice, in words as well as symbol. A figure written as $4,000 means something different in 4 countries, and an invoice paid in the wrong dollar becomes a long conversation.

Also name the date the rate is set, where you invoice in a currency other than your own. Without that, the difference between your figure and their figure is unresolvable, and it turns into a dispute about the amount rather than a rounding note.

What to put on a cross-border invoice

Everything a domestic invoice carries, plus the items that a foreign accounts payable team will otherwise write to you about:

• Your full legal entity name and registered address, matching the tax form exactly.

• Your tax registration number in your own country, where you have one.

• The currency, stated in words.

• Complete bank details for the route the client will actually use.

• The purchase order number, where one exists.

• Their legal entity name, which is frequently different from the brand you work with.

That last point causes more delay than it should. Large groups run several registered companies, and an invoice addressed to the wrong one fails the client's checks even though everyone knows who you are. Ask which entity to bill during setup, along with the other payment questions worth settling before you start.

The message that prevents all of this

One email at onboarding replaces most of the delays above. Send it when the work is agreed, not when the first invoice is due:

Subject: Billing setup for [project]

Hi [Name],

Before we start, could you point me to whoever handles supplier setup on your side? I'd like to get the admin done now so the first invoice isn't held up.

From us you'll need: our completed [W-9 / W-8BEN-E], our bank details, and our registered entity details. I can send all 3 today.

From you I need: which legal entity to invoice, where invoices should be sent, whether a purchase order is required, and whether payments are sent with all transfer charges paid by you.

Thanks,

[Name]

It works because it asks a specific person for specific items and offers to do the work first. Sending it from a shared billing address helps as well, since the forms and bank details then live somewhere other than one person's inbox.

FAQ

Why is my US client asking for a W-9 or W-8 before paying?

Because US companies have to document who they pay. The form goes to the client rather than to the IRS. A US supplier sends Form W-9, and a foreign one sends W-8BEN-E as a company or W-8BEN as an individual. Until it is on file the invoice is usually held.

Can a US client withhold 30% of my invoice?

Only on US-source income. For services, the source generally follows where the work is performed, so an agency working from its own country is usually earning foreign-source income. Return your W-8 early so the client can document it, and get advice if part of the work happens on US soil.

What happens if I don't return a W-9?

The payer is required to apply backup withholding, which the IRS sets at 24%. That applies to US payees who do not furnish a correct taxpayer identification number, and it is entirely avoidable.

My payment arrived short. Was it underpaid?

Usually it was a bank fee rather than a shortfall. International wires sent with shared charges have intermediary deductions taken from the amount in transit. Check the remittance advice before raising it, and agree who pays transfer charges in the contract.

Which currency should I invoice international clients in?

Invoicing in your own currency puts the exchange risk on the client and is cleanest. Invoicing in theirs is easier to sell and leaves you carrying rate movement over the payment term. Whichever you pick, state it in words on every invoice.

How long does supplier setup take with a foreign client?

Longer than the work usually allows. Bank detail verification is deliberately slow, and tax forms add another round trip. Start it the day the engagement is agreed rather than when the first invoice is ready.

Not tax or legal advice. Withholding, treaty positions and tax registration depend on your own country, your entity type and the specific engagement — confirm your position with a qualified adviser before relying on any of the above.