Margins always use the current ruler units, so if you have a doc where they are not currently reading inches, you can right-click a ruler (or the intersection of the rulers to set both) and change the units. Once a document is set-up, you find the margin settings under the Layout menu.
As well as this - you can type most measurements into the dialog and it will automatically change.
For instance if you're working in mm and want to set inches for your Margins you can simply type into the margins area
and it will convert to 5mm