Remote work has made overseas clients normal — a designer in Leeds invoicing a startup in Berlin, a consultant in Bristol working for a firm in New York. It's great for your income and only mildly more complex for your tax. Here's what actually changes.

You still pay UK tax on it

The simplest and most important point: if you're UK-resident, you pay UK tax on your worldwide income. Money from an overseas client is taxed here through Self Assessment just like money from a UK client — converted to sterling at a sensible exchange rate. Being paid in dollars or euros doesn't move where you're taxed; you're taxed where you live and work.

The occasional double-tax question

Sometimes an overseas client (or their country's rules) wants to withhold tax at their end. The UK has double taxation agreements with many countries precisely so you're not taxed twice on the same income — you can usually claim relief for foreign tax paid against your UK bill. It doesn't come up often for straightforward services, but if a client mentions withholding tax, flag it to your accountant rather than accepting a deduction blindly.

VAT: the place-of-supply rules

This is where overseas work genuinely differs. For most services sold to a business customer outside the UK, the "place of supply" is where the customer is — so the sale is generally outside the scope of UK VAT (you don't charge UK VAT). Rules differ for services to consumers abroad, and for digital services, which can create obligations in the customer's country. If you're VAT-registered or approaching the threshold and selling abroad, get the treatment checked — it affects both what you charge and your VAT return.

Getting paid across borders

  • Watch the fees. Traditional banks and some platforms take a chunk on currency conversion. Multi-currency accounts and specialist providers often save real money on international payments.
  • Record the sterling value. Your books need the GBP amount at the date of the invoice or payment — FreeAgent (in our packages) handles the conversion and record-keeping.
  • Invoice clearly. State your currency, terms and bank/payment details; overseas clients and their finance teams appreciate precision, and it gets you paid faster.
Don't overthink it — but don't wing the VAT For most freelancers, overseas clients mean "same UK income tax, just convert to sterling, and probably no UK VAT on B2B sales abroad." The bit worth professional eyes is VAT place-of-supply and any withholding tax. Get those right and international work is pure upside.

How we help

We handle the currency conversions in your accounts, apply the right VAT treatment to overseas sales, and sort any double-taxation relief — so you can take the international work without second-guessing the tax. Get started from £19 + VAT a month.