The cross-border complications
Selling agency services internationally adds three layers most agencies handle poorly:
- Currency — exchange-rate risk, payment-method friction
- Tax — VAT, GST, withholding tax, reverse-charge
- Legal — governing law, jurisdiction for disputes
Get any of these wrong and a profitable client becomes unprofitable.
Pricing in USD (always)
For clients outside the US:
- Quote and invoice in USD
- Specify currency clearly: "$5,000 USD per month"
- Include conversion clause: "Equivalent in client's local currency calculated at spot rate on invoice date"
Why USD: stable reference, well-understood globally, simplifies your accounting.
The agencies losing on international deals are the ones who let the client dictate currency ("can we pay in INR?") and absorb the FX risk.
Payment terms that work globally
Standard terms for international clients:
- First invoice + setup fee: paid before kickoff (mitigates non-payment risk)
- Monthly retainer: NET-15, paid by wire or international payment platform
- Late fee: 1.5% per month after 15 days
- Currency: USD (with local-currency equivalent allowed)
Payment platforms that work globally:
- Wise (formerly TransferWise) — best for SMB international clients, low fees
- Stripe — for clients in Stripe-supported countries
- Razorpay International — emerging-market friendly
- Wire transfer — fallback for any country
Avoid PayPal for B2B agency work — high fees, dispute risk.
Tax handling — the 4 scenarios
Scenario 1: You're in country X, client is in country Y
- VAT/GST: Most "B2B services to foreign companies" qualify for zero-rated VAT (export of services). Verify with your accountant.
- Withholding tax: Some countries (India, Vietnam, etc.) require client to withhold 5-15% as tax. Build this into your gross fee, or charge client gross-up.
Scenario 2: You're in EU, client is in EU
- VAT reverse-charge: B2B sales between EU member states use reverse-charge — client pays VAT in their country, you don't charge.
- VAT ID: Both parties need valid VAT IDs.
Scenario 3: You're in US, client is in EU
- VAT: As a US agency, you don't charge EU VAT. Client may have to pay it themselves.
- Permanent establishment: If you have employees in the EU, this changes — consult a lawyer.
Scenario 4: You're in US, client is in US (different state)
- Sales tax: Most states don't tax marketing services. Some do (Hawaii, New Mexico, South Dakota, Texas, West Virginia). Verify.
Legal clauses to include
Three clauses every international SOW needs:
Governing law
"This Agreement is governed by the laws of [your country]. Any disputes shall be resolved in the courts of [your city]."
This protects you from being dragged into the client's legal system.
Currency clause
"All fees are denominated in USD. Payment in client's local currency is permitted at the spot exchange rate on the invoice date, with any difference billed/credited on the next invoice."
Protects you from FX fluctuation.
Withholding tax clause
"If applicable law requires Client to withhold tax on payments, Client shall gross up payment so Agency receives the full invoiced amount."
Protects you from absorbing client-country withholding tax.
Cultural considerations that affect close rate
Every market is different. A few patterns:
- US/UK: Direct, fast decisions, contracts standard
- Germany/Switzerland: Detailed contracts, slower decisions, payment is reliable
- Middle East: Relationship-driven, longer cycles, payment terms negotiable
- India/SEA: Price-sensitive, slower payment, expect to push on terms
- China: Different platform stack (WeChat, etc.), often pre-paid, language barrier
Adjust your proposal tone and pricing strategy to the market. A US-style "sign by Friday" close fails in Germany.
Use a template that handles international by default
Our proposal templates support USD pricing, multi-region terms, and tax-clause clauses by default.