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Indian TDS Tax Withholding on Upwork Earnings

lenaellis
Community Member

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.



 

492 Comments
AleksandarD
Community Manager

Hi Amin,

 

One of our team members will reach out to you directly via a support ticket to assist you further.

Thank you.

amin_raiyani
Community Member

Ok thank you

76681f54
Community Member
Hello
Can I change my PAN number on Upwork.
How will it impact my TDS (WHT) , Form 16A and 26AS.



sandip3705
Community Member

No we have not received yet.!

bcc69213
Community Member

Hi,

I have an agency account and I completed a contract worth $150 and received only $118.87 instead of $120.

Can someone please explain?

BojanS
Community Manager

Hi Aabhas,

 

Tax Deducted at Source (TDS) is a means of collecting income tax in India by requiring businesses making payments in India to remit a portion of that payment directly to the Indian government. The amount of tax withheld is matched to the service provider by using their Permanent Account Number (PAN) or the Aadhaar number. 

 

You can check this help article for more information.

 

Thank you! 

bcc69213
Community Member

Hi Bojan,
Thanks for your reply.

Just curious: Will I get a receipt of this? Need to share that with the accounts team.

Let me know!

Thanks

BojanS
Community Manager

Thanks for your question, Aabhas.

 

We've been advised that the reporting is done quarterly. So a statement will be provided to you every three months.

zahirupwork1
Community Member

Hello
Can I change my PAN number on Upwork? I need to enter aadhaar number
How will it impact my TDS (WHT)

pradheesh23
Community Member

Hi, may I know why I'm being taxed for the amount that I have in upwork? I earn less than the taxation amount per financial year, then why I'm being taxed? I understand and I have read that article mentioned by upwork. My question is why I'm taxed by upwork? If I earn above the taxation limit, then I'm going to pay the tax to the government of India. Why upwork need to deduct money is my question? Form 16A is for people who earn more than 4 lakh per year (I suppose). I also need to know the law/act number which says upwork to deduct tax from freelancers as this Indian Tax Deducted at Source (TDS) or Withholding Tax   is provided in upwork website than in Indian government website. I want the TDS page from the government stating upwork website to collect tax from freelancers. Will upwork provide me that? Guys what's your opinion? Is upwork cheating us in the name of tax? How they pay the tax to the government if they deduct money?