Most freelance contracts say how much the work costs. Far fewer say what the price is denominated in, who pays when the exchange rate moves, or whose job it is to cover the transfer fee. For a domestic client that omission never matters. For a client in another country it can be worth more than the rate you spent a week negotiating.
A currency clause is a few sentences that settle all of this before the first invoice goes out. Here is what it should cover and how to word it.
A currency clause names the currency every invoice is issued and paid in, fixes how and when any conversion is made, says who bears the transfer fees, and sets a trigger for reviewing the price if the exchange rate moves too far. Write it into the contract and repeat the currency on every invoice, using the three-letter code rather than a dollar sign.
What a currency clause is for
A currency clause is the part of a contract that fixes the money an agreement is measured in, and who absorbs the cost of moving between currencies. Without one, each side assumes the sensible reading is the convenient one for them. The client assumes “$5,000” means whatever dollars they hold. You assume it means the dollars you can spend. The disagreement tends to surface when a payment arrives short.
The clause does four jobs, and each is a sentence or two.
1. Name the currency exactly
Write the three-letter code, not the symbol. At least six currencies use a dollar sign, and “$5,000” is not a price until you say which dollar.
The fees under this agreement are set in United States dollars (USD). All invoices will be issued in USD and payment is due in USD.
Keep the same currency for the life of the engagement. A mid-contract switch creates two reference points and an argument about which one a later review uses.
2. Say who converts, and when
If the contract is in the client’s currency and you spend in yours, you are the one converting. If it is in yours, the client is. Either is fine, as long as it is written down, because whoever converts carries both the rate movement and the provider’s margin.
If you want a conversion date fixed, say so, rather than leaving it to whichever day the money moves.
Where either party converts an amount into another currency, it will use the mid-market rate published by the European Central Bank for the date of payment.
You will only need this clause when a figure is disputed, but when you do, having named a dated, public source ends the discussion quickly. Which exchange rate to use on a foreign currency invoice explains why the payment date is the usual choice.
3. Allocate the transfer fees
Fees are the most common cause of a short payment, and they come from at least two places: your client’s bank, and any bank in between. Decide whether the invoice amount is what leaves the client’s account or what arrives in yours.
The client will bear all fees charged by its own bank and by any intermediary. The amount received by the contractor must equal the invoiced amount.
On bank wires you can reinforce this by asking the client to select the “OUR” charge instruction, which means the sender pays all fees. Getting paid by overseas clients covers what to put on an invoice so the payment arrives whole.
If a client resists, a reasonable middle is to split the fee, or to name the route you prefer, since the provider you choose decides how big the fee is. You can check a route’s real cost with the forex markup calculator before you commit to it in writing.
4. Add a review trigger for long engagements
On a short project, the exchange rate barely moves and a review clause is overkill. On a retainer that runs six months or more, a steady drift against you works like a pay cut nobody announced. A review trigger turns that into a contractual conversation rather than an awkward one.
If the exchange rate between USD and EUR on the first day of any quarter differs by more than 5% from the rate on the date of signature, either party may request a review of the fees. Fees will remain unchanged unless both parties agree in writing.
Note what this does and does not do. It doesn’t adjust the price automatically. It gives either side the right to ask, and an agreed number (here 5%) that defines “too far”. That is usually enough, and it is easier to agree to than an automatic mechanism.
Use the same band you would use in conversation. Five percent is a reasonable starting point, but a smaller band suits thin margins, and a wider one suits short, low-value work.
Putting it together
A compact version, ready to adapt:
Currency. All fees are stated and payable in United States dollars (USD). The client bears all bank and intermediary fees so that the contractor receives the full invoiced amount. Where a conversion is needed, the European Central Bank reference rate for the payment date applies. If the USD/EUR rate moves more than 5% from its value on the date of signature, either party may request a review of the fees.
Then repeat the currency on every invoice, next to the amount due. The contract fixes the agreement. The invoice is the document the client’s accounts team actually reads, so the currency has to be right there too. Contracts for clients you never meet covers the other clauses a cross-border agreement should pin down.
This is general guidance and sample wording, not legal advice. Enforceability depends on where you and your client are based, so have a lawyer review any clause that carries real money before you rely on it.
Frequently asked questions
Do I need a currency clause if I only work with one overseas client?
Yes, particularly for one large client. The clause costs a few sentences, and it settles the question that is most likely to become a dispute: who covers a short payment. A single retainer in a foreign currency can be a large share of your income, so the exposure is rarely small.
Can the client pay in a different currency from the one on the invoice?
Only if the contract says so. Otherwise the invoice currency governs, and a payment in another currency leaves open who bears the conversion. If you accept it as a courtesy, state the rate and date you will use, and accept it in writing, so the shortfall is not your problem later.
Who should pay the transfer fees on an international payment?
Whoever the contract says. The common ask from the contractor is that the client bears the sending-side fees, so the full invoice amount arrives. It is a negotiable term, not a rule, and splitting it is an acceptable compromise. Leaving it unstated is the only wrong answer.
What exchange rate should a contract use?
A dated, public mid-market reference, such as the European Central Bank’s daily rate. It is neutral, free to check and repeatable by either side. A rate set by one party’s bank invites doubt about whether the margin was included, so avoid naming a bank’s own rate as the benchmark.
Where Billable comes in
Billable puts the currency on every invoice in plain sight. Set it per invoice, or on the project so every invoice under it begins in the currency you agreed, and your client is billed in the money the contract names.
When payments land, Billable shows what arrived against the reference rate, so you can see whether the fee allocation you negotiated is working. It’s free for your first active project, with flat plans after that and no per-user fees. See how transfer costs are tracked.