Invoicing Clients in the US vs Europe as a Freelancer in Portugal: What Actually Changes

Two client types, two different VAT treatments

For a recibos verdes freelancer, the starting point for every invoice is the same question: is the VAT rule for this client reverse charge, or is it export of services. The two get confused constantly because both result in an invoice with no Portuguese VAT added, but the legal basis behind that zero is completely different, and using the wrong one is a common reason invoices get sent back for correction.

Reverse charge applies when the client is a VAT registered business in another EU country. The freelancer issues the invoice without charging VAT, and the client accounts for VAT under their own country’s rules through their own VAT return. This only works between two EU parties and depends on both sides being properly VAT registered where required.

Export of services applies once the client is outside the EU. A client in the United States, or in the UK for that matter, is not part of the EU VAT area, so the transaction is not a reverse charge situation at all. It falls under different rules entirely: the service is treated as an export, and EU VAT simply does not apply to the transaction in the first place.

What the invoice actually needs to say

The practical difference between the two shows up directly on the invoice text. A reverse charge invoice to an EU client needs specific wording referencing the reverse charge mechanism, along with both the freelancer’s and the client’s VAT numbers, so the client’s accounting team can process it correctly on their end.

An export of services invoice to a US client does not carry reverse charge language at all, since reverse charge is an EU concept that has no application outside the EU VAT area. Instead, the invoice needs to reflect that the service is outside the scope of EU VAT, without implying a VAT registration relationship that does not exist between a Portuguese freelancer and a US business.

Using reverse charge wording on an invoice to a US client is a mistake that shows up more often than freelancers expect, usually because a template was built once for EU clients and then reused for every invoice afterward without adjusting the VAT language for the client’s actual location.

A worked example

Take a Portuguese copywriter under recibos verdes who splits their work between a marketing agency in France and a software company in the United States. The France invoice carries reverse charge wording, both VAT numbers, and settles through SEPA within a day or two of the agency processing payment. The US invoice carries export of services wording, no VAT numbers beyond the freelancer’s own Portuguese tax details, and arrives days later as a wire transfer already reduced by a correspondent bank fee and a dollar to euro conversion.

Side by side, the two invoices for an identical fee can look almost nothing alike, and the money that actually lands in the freelancer’s account can differ by a noticeable margin even when the invoiced amount was the same. This is exactly the kind of mismatch that leads freelancers to search for terms like Portugal freelancer invoice US client or recibos verdes invoicing USA, trying to understand why one client relationship behaves so differently from another..

Payment rails: SEPA versus wire transfer

VAT treatment is only half the difference. How the money actually moves is the other half, and it changes just as much between the two markets.

An EU client paying a Portuguese freelancer typically settles through SEPA, the euro area’s standard payment rail. SEPA transfers are fast, usually landing within a day, and carry minimal or no transfer fees regardless of which EU country the payment originates from.

A US client is a different story. Payment usually comes through a SWIFT wire transfer, which is slower, often takes several business days, and typically comes with a correspondent bank fee taken somewhere along the chain, sometimes without the freelancer even seeing exactly where it was deducted. On top of that, a US client is paying in US dollars, so the freelancer is exposed to a currency conversion that a same currency EU payment never involves.

Freelancers who invoice both markets often notice the US invoices arrive smaller than expected once the wire fee and conversion rate are factored in, even when the invoiced amount was identical to a comparable EU invoice.

The W-8BEN question

Freelancers invoicing US clients for the first time are often asked, either directly or through a platform, to complete a W-8BEN form. This is a US tax form that confirms the freelancer is a foreign person, not a US taxpayer, so the US client or platform does not withhold US tax on the payment.

This is unfamiliar paperwork for a recibos verdes freelancer whose usual invoicing relationship with the Portuguese tax authority does not involve anything similar. It is worth understanding that a W-8BEN relates to the US client’s own withholding obligations under US tax law, not to the freelancer’s obligations in Portugal, which remain governed entirely by Portuguese rules regardless of where the client is based.

Which market settles faster

Timing is one of the more overlooked differences between the two markets. A SEPA payment from an EU client typically clears within one to two business days of being sent, with the amount landing exactly as expected since there is no currency conversion involved between euro denominated accounts.

A wire transfer from a US client routes through one or more correspondent banks before it reaches a Portuguese account, which can add several business days to the process. Each correspondent bank in that chain can take a small fee before passing the payment along, and the amount is also subject to whatever exchange rate applies at the moment of conversion, which the freelancer has no control over and often cannot see clearly on the remittance advice.

Remotify acts as a Merchant of Record, meaning the invoice type is handled correctly either way

Remotify acts as a Merchant of Record, meaning it issues the invoice to the client on the freelancer’s behalf and settles payment once the transaction is complete. In practice, Remotify determines whether a given client relationship falls under reverse charge or export of services based on where the client is actually registered, and issues an invoice with the correct wording and VAT treatment for that market automatically.

For the freelancer, this removes the need to maintain two separate invoice templates, remember which wording applies to which client, or double check VAT numbers on every EU invoice. Whether the underlying client is in Germany or in the United States, Remotify handles the invoice side distinction, while the freelancer’s own Portuguese tax obligations, including income tax, remain entirely the freelancer’s responsibility to declare.

Where SEPA fits regardless of the client's location

The other half of what Remotify changes is on the payment side. Once the invoice is settled by the client, Remotify pays the freelancer through SEPA, regardless of whether that client was in the EU or the US.

This means a Portuguese freelancer working with a mix of EU and US clients does not have to manage two different incoming payment experiences. There is no wire transfer to track, no correspondent bank fee to chase down, and no currency conversion happening on the freelancer’s side of the transaction, since Remotify absorbs that part of the relationship between issuing the correct client facing invoice and settling with the freelancer in a consistent way.

KYC and AML checks are handled by Remotify during onboarding, and Remotify’s DAC7 reporting obligations as an EU platform run in the background of every payment, separate from the freelancer’s own VAT registration status and income tax filings in Portugal.

A quick comparison

An EU client invoice generally means reverse charge VAT wording, both parties’ VAT numbers on the document, and a same currency SEPA payment landing within a day or two. A US client invoice generally means export of services wording with no reverse charge language, a possible W-8BEN request from the client, and a wire transfer in US dollars that takes longer and often loses value to fees and conversion along the way.

The one part of the process that stays constant, when a freelancer invoices through Remotify, is that the freelancer receives their payment through SEPA either way, and never has to be the one working out which VAT rule applies to which client.

Getting started

Freelancers under recibos verdes who invoice a mix of EU and US clients can use Remotify to issue the correct invoice type automatically for each client and receive payment through SEPA regardless of where the client is based. Details on how this works across different client volumes are available at remotify.co/pricing.

Frequently Asked Questions

Do I charge VAT when invoicing a client in the US?

No. A US client falls under export of services, which is outside the scope of EU VAT, so no Portuguese or EU VAT is charged on the invoice.

Is invoicing a US client the same as reverse charge?

No. Reverse charge only applies between VAT registered businesses within the EU. A US client is treated as an export of services instead, which is a different legal basis and does not use reverse charge wording.

Why did my payment from a US client arrive smaller than expected?

US payments typically travel through a SWIFT wire transfer, which often carries a correspondent bank fee, plus a currency conversion from US dollars to euros. Both can reduce the amount that actually lands compared to the invoiced total.

What is a W-8BEN and do I need to fill one out?

A W-8BEN is a US tax form confirming you are a foreign person for US tax purposes, so a US client or platform does not withhold US tax on your payment. It relates to the client’s US tax obligations, not your Portuguese ones.

Does Remotify pay me the same way for US and EU clients?

Yes. Remotify settles payments to freelancers through SEPA regardless of whether the underlying client is based in the EU or the US.

Do I still need to declare this income in Portugal?

Yes. Income tax on earnings from any client, EU or US, remains the freelancer’s responsibility to declare in Portugal. Remotify does not handle income tax filings.

Is Remotify a payroll provider or umbrella company?

No. Remotify is a Merchant of Record. It issues invoices with the correct VAT treatment for each client’s location, applies DAC7 compliance, and settles payments through SEPA. It does not employ freelancers, run payroll, or handle income tax filings.