Introduction
Being a freelancer is hard. You have to deal with invoicing, taxes, and keeping track of expenses. This can be especially difficult if you're working in more than one currency and don't know how to keep track of everything.
Multi-currency invoicing is a great way for freelancers like you to simplify the process of charging and keeping track of payments from international customers. In this post, we'll cover: what multi-currency invoicing means; why it matters; how to set up your own multi-currency invoice; and how to profit from using this tool.
What is multi-currency invoicing?
Multi-currency invoicing is a way to invoice in multiple currencies. It's also called multi-currency billing, and it can be used with any invoicing software.
Multi-currency billing is important for freelancers who work internationally because it allows them to invoice their clients in the currency that makes sense for their business--not necessarily the local currency of the client's country. For example, if you're an American and you invoice a Chinese company for your services, then you might want to charge them in US dollars instead of yuan (which would require converting).
Why should I use multi-currency invoicing?
As a freelancer, you may find yourself working with clients in different countries and currencies. Multi-currency invoicing helps you send your invoices in any currency at all times so that you can avoid the hassle of changing it manually every time you create an invoice.
You'll also be able to invoice in the currency of your bank account so that it's easier to track how much money is coming in from each project or customer. This makes managing taxes easier too!
How do I set up a multi-currency invoice?
To set up a multi-currency invoice, you'll need to:
- Create a new invoice.
- Select the currency that you want to invoice in (for example, USD).
- Fill in the invoice details (date and description). You can also add additional information like tax rates or specific line items.
- Select which currency you would like to charge in (for example, GBP). This will automatically convert all amounts into their equivalent value in GBP when sending an email copy of your invoice to clients who prefer that currency over USD or any other supported currencies listed below: Czech Koruna (CZK), Danish Krone (DKK), Euro (EUR), Hungarian Forint (HUF), Israeli New Shekel (ILS), Japanese Yen (JPY), Norwegian Krone(NOK), Polish Zloty(PLN), Russian Ruble(RUB) South African Rand(ZAR) Swiss Francs(CHF) British Pounds Sterling (£GBP).
How can I profit from multi-currency invoicing?
Multi-currency invoicing can help you profit in a variety of ways.
- You can charge different rates for different currencies. If your client is based in the United States and you live in Europe, it might make sense to charge them in USD rather than euros. This way, they'll pay less money on their end (and you'll get more).
- You can charge different rates for different types of work or time periods. For example, if a client asks you to write an article about something specific--say, how to manage inventory at a grocery store--you could charge them more than if they just asked for general advice about starting an ecommerce business from scratch. Or maybe some clients only want short term projects while others need long term help with their marketing strategy? In those cases it might be worth charging more per hour than usual because those clients are looking specifically at what types of services will benefit them most right now rather than being able to benefit over time like other customers might do...
Multi-currency is an important tool for any freelancer operating internationally.
Multi-currency is an important tool for any freelancer operating internationally. Multi-currency invoicing allows you to price your services in multiple currencies, which can be useful if you're selling your work to clients from around the world.
Let's say that you're a designer based out of New York and have been hired by a client based in Germany. If this client pays their designers in euros and converts USD into EUR at an exchange rate of 1:1 (which is what most banks do), then they would pay $100 USD for each hour worked by their designer--$100 x 1 = 100EUR x 0.8 = 80EUR. This means that after conversion fees were taken into account, the German company actually paid only 80 euros per hour instead of 100 euros per hour; this represents 20% less than what they expected!
If we look at another scenario where our American freelancer has set up multi-currency invoicing correctly with Xero Accounting Software, then things get much easier: when payment comes through via Stripe Connected Accounts (which means using Stripe as both gateway provider AND account holder), Xero automatically converts all incoming payments into US dollars before depositing them into our US bank account via ACH transfer*. In other words: since Xero processes all incoming payments automatically through its own system rather than relying on third party services like PayPal or Square Inc., there are no additional fees attached when converting currencies - making it possible for us as freelancers working abroad not only save ourselves some money but also offer better rates than those charged locally!
Conclusion
We hope that this article has helped you understand the benefits of multi-currency invoicing and how to set up your own. It's a powerful tool that can help you make more money as a freelancer, but it also requires some work on your part to get started. If you're looking for an easier way to manage multiple currencies without worrying about exchange rates or international money transfers (and who isn't?)
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