Before 2021, a client in London was almost the same as one in Berlin for a Spanish account. Today the UK is outside the European Economic Area, and that shows up in two fees: the foreign-card surcharge and the conversion from pounds to euros.
What changed with Brexit
Processors charge less when the card is from your own region. For a European Stripe account, a UK card no longer counts as "local": it carries a 1% surcharge, a little less than the 1.65% for the rest of the world, but one that did not exist before. And because the client pays in pounds and you are paid in euros, the money has to be converted.
The result: the same £2,000.00 payment through Stripe costs £89.24 from the UK, against €30.25 for the same amount in euros from Germany.
What each route costs
- Card fee
- Cross-border
- Conversion
- Payout
| Provider | Client pays by | Cost | Effective |
|---|---|---|---|
| Wise Business | Bank transfer | −£6.60 | 0.33% |
| Revolut Business | Bank transfer | −£12.00 | 0.6% |
| Payoneer | Bank transfer | −£43.76 | 2.19% |
| Stripe | Card | −£89.24 | 4.46% |
| Paddle | Card | −£100.50 | 5.03% |
| Whop | Card | −£103.46 | 5.17% |
| PayPal | Card | −£141.63 | 7.08% |
| Lemon Squeezy | Card | −£149.19 | 7.46% |
Bank-transfer routes come out far ahead because there is no card surcharge and the conversion markup is small. The big gap is not between Stripe and PayPal; it is between card and bank transfer.
How to receive pounds without losing money
- UK bank details. Wise and other providers give you a UK account number and sort code. Your client pays you by Faster Payments like any local supplier, and it usually arrives the same day.
- Keep pounds if you spend pounds. If you pay for tools, subcontractors or travel in the UK, converting only what is left over saves half the conversions.
- If you are paid by card, Stripe over PayPal. PayPal's UK surcharge for European accounts is higher, and its conversion markup is more than double Stripe's on European accounts.
The invoice and VAT
For VAT, the UK is now a country outside the EU. For a service supplied to a UK business, the general rule is that no Spanish or other EU VAT applies, because the service is treated as supplied where the client is, and the invoice should say so. If you sell digital products to UK consumers, things change (I cover that in the merchant of record guide). Check with your accountant; this is not tax advice.
Which currency to invoice in
If you have pound account details, invoice in pounds: your client pays a round figure and you convert cheaply. If you do not, and they will pay by card, invoicing in euros moves the conversion to the client's bank. The trade-offs are in the invoice currency guide, and the numbers for your own case in the calculator.
Every figure in this guide is calculated from the providers' public pricing pages, with the same function as the calculator. See the methodology for what the model includes and leaves out.