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Re: Withholding TDS in India

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Community Manager
Lena E Community Manager Member Since: Apr 7, 2015
1 of 125

Starting October 1st, Upwork will begin withholding Tax Deducted at Source, TDS, from payments to freelancers and agencies located in India as part of a new tax law enforced by the Indian government.

 

As part of our continued efforts to remain compliant with tax laws in India, we are asking that our customers in India provide their Income Tax Identification number in the “Tax Info” section under “Settings”. For purposes of TDS withholding, the Indian government will accept either a Permanent Account Number (PAN) or an Aadhaar number. Please be sure to use the correct format for your PAN or Aadhaar number as defined by the Indian government:


  • PAN is a 10-digit alphanumeric entry, i.e., A A A A A # # # # A
    # = Numeric   A = Alphabetic 
  • Aadhaar is a 12-digit numeric entry


For those freelancers and agencies that have provided a PAN or an Aadhaar number:

We are required to withhold 0.75% of all your payments, starting with the first dollar you earn as of October 1, 2020, and forward it to the Indian government. The rate is scheduled to increase to 1% on April 1, 2021.

 

For those freelancers and agencies that have not provided a PAN or an Aadhaar number:

We will be required to withhold 5% of all your Upwork earnings and forward it to the Indian government. You will be able to claim a tax credit or refund from the Indian government should you pay more taxes than required. 



You will need to add a PAN or Aadhaar number in order to keep the withholding tax at .75% of your earnings.  Click here to Add Income Tax Identification.

 

To learn more about Indian TDS, click here

 

Let us know if you have any questions.



 

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Active Member
Mohammad A Member Since: Jun 22, 2020
2 of 125

New rule of withholding TDS for indians is going to start from Oct.1.

So now freelancer earning will be like 20% upwork commission, 0.75% TDS, $1.5/10 connects, $0.99 per withdrawal to local bank, this is so ufair upwork should reduce the commission fee they have imposed, or should provide free monthly connects.

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Active Member
Biju J Member Since: Apr 7, 2015
3 of 125

It is totally unfair charging TDS on the amount upwork takes as service charge.

TDS should be charged only on the amount the contractor receive. That is our earing.

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Community Guru
Abinadab A Member Since: Sep 26, 2016
4 of 125

The dead hand of the tax man.

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Community Guru
Isabelle Anne A Member Since: May 19, 2014
5 of 125

Abinadab A wrote:

The dead hand of the tax man.


Yeah. This plus the 10%-20% fees, fees for membership, withdrawals, etc. It's just charges on top of more charges.

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Active Member
Harsh P Member Since: May 6, 2015
6 of 125

Take everything whatever we are earning... Smiley Sad

20% Fees!

Paid Connects to send Proposals!

Withdrawal Fees!

and now TDS withholds!

 

Seems like in near future only paid membership to create an account on Upwork!!

 

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Moderator
Valeria K Moderator Member Since: Mar 6, 2014
7 of 125

Hi Harsh and others,

 

Thanks for your feedback. Upwork fees help to cover the costs of acquiring new clients and providing services like payment protection, customer support, and platform infrastructure. Regarding, the tax announced here, we are required to forward any tax we collect from our users to the Indian government.

~ Valeria
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Active Member
Biju J Member Since: Apr 7, 2015
8 of 125

No problem taking TDS. 

TDS should be charged only on the amount that contractors earn

Our earning is what we get after deducting service charge.

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Active Member
Nisha B Member Since: Oct 14, 2019
9 of 125

Hi,

 

I do all my work exclusively through an Agency in Upwork and all payments go to the Agency. Would the withholding tax apply to me or the Agency?

 

Regards

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Active Member
Bibhas D Member Since: Oct 21, 2015
10 of 125

I have the same question. All Agency payments are going to Agency account, so is it require to add PAN for individual Freelancer?
Please let me know.
Thanks,
Regards

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