🐈
» Support » Product Release Notes » Indian TDS Tax Withholding on Upwork Earnings
Page options

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
rohetgoel
Community Member
I have checked TRACES and it shows there is no amount credited to the Indian government for my PAN number.

Indian tax year is closed on March 31 2021, and the Form 26AS doesn't show any tax amount credited from Upwork

Additional, last daye to file income tax returns without penalty is 31st june 2021 for FY 20-21. Incase tds deposited doesn't gets credited to my pan, i will end up paying penalties which is 5000 Rupees
PradeepH
Moderator

Hello Rohit,

 

We had hoped to have the tax information available by the end of the Indian tax year, but there were some delays due to unclear filing instructions and limited guidance from our accounting partners in India. Please know that all funds withheld have been remitted to the Indian government; the delay has been in the reporting and allocation of those funds on an individual user basis. 

 

We understand this information is critical to you and we are sorry for the delay. We should have this matter resolved as soon as possible, so you should not incur any penalties from the delayed issuance of the form 16As. You should receive an update via email as soon as this is resolved.

 

We appreciate your patience. 

 

Thank you.

Pradeep H.

rohetgoel
Community Member
Pradeep, you guys are just passing the ball from here to there.
If the tax credit is not showing in my account, how can i file my returns. If i file my return without tax credit from Upwork, i will lose that money and will not be able claim refund/setoff from revenue department and in future revenue department will question me whether I have consider that amount in my return, because your amount is not reflecting. Unnecessary compliance burden will a arise for me.

So i would suggest you get your head together and get it resolved on priority basis.

As you saud "limited guidance from our accounting partners in India" hire better partners in India.
galaxysoftware
Community Member

That's right Upwork,

 

I totally agree with Rohit!

 

Hire better partners in India, there are many.

 

It's an irony that we have to suggest this to you guys!!

 

Tax credits should promptly reflect in our accounts, this is not something that should be taken lightly!!

 

You guys already have had more then 6 months to resolve this issue fully!

786khan
Community Member

Hahaha!

Current USD in INR is 73.55. But when i am transferring my all income into bank it showing 

71.8600 USD/INR  and upwork already taking $0.99 fee of txn. So my query is why upwork is taking exchange rate 71.86 instead of 73.55. I am transferring $1000 and upwork income 1690 INR it's too much. I already paid 20% upwork fee, 1% WHT. Yesterday one of my friend received money from Payoneer and the exchange rate was 72.33 $/INR.

Total Loss:
20% = $200

1%    =  $10

$0.99=$0.99 

1690= $22.97

total = $331.97  What the **bleep**!

 

Robbery!

apeter5
Community Member

100% agree, i also lost many jobs because of 20% fees of upwork, either client is not able to pay or i can not manage fees.

aeprakash77
Community Member

Hi,

I understand there is still some delay in getting Form 26AS updated with tax credited by Upwork. I could see in TRACES that Form 26AS for Q3 FY 2021-22 has been updated. Much appreciated if you can share the timeline by which you will be able to provide an update for Q4 FY 2021-22 as well! Thanks in advance

regards

Lakshman

rohetgoel
Community Member

I don't understand what are you guys doing, it's just a simple return with very simple information, I don't why are you guys having such a hard time.

 

you have mentioned on URL https://support.upwork.com/hc/en-us/articles/360044709894-Indian-Tax-Deducted-at-Source-TDS-or-Withh...

Form 16A for October–December 2020 –– We expect to email the form to you in April, and your transaction details for that quarter should be visible in TRACES  around the same time.  

Form 16A for January–March 2021 –– It should arrive on schedule in May and you should be able to view details in TRACES in June"

 

We are unable to view tax credits for the period of Form 16A for October–December 2020, which was due in April, As stated by upwork. However, as of 17th May 2021, we haven't received any update from you guys. It's like Upwork is only worried about his commission and fees, they are least worried about the various freelancers working on their platform. 

 

I am again repeating myself

 

The Indian tax year is closed on March 31, 2021, and Form 26AS doesn't show any tax amount credited from Upwork.

Additional, the last date to file income tax returns without penalty is 31st July 2021 for FY 20-21. In case TDS deposited doesn't get credited to my account with the revenue department, I will end up paying penalties which will be 5000 Rupees

 

If the tax credit is not showing in my account, how can I file my returns? If I file my return without tax credit from Upwork, I will lose that money and will not be able to claim a refund/setoff from the revenue department, and in the future revenue department will question me whether I have considered that amount in my return, because your amount is not reflecting. An unnecessary compliance burden will arise for me.

So I would suggest you get your head together and get it resolved on a priority basis.

As you said "limited guidance from our accounting partners in India" hire better partners in India. Let me suggest to some partners in India,  E&Y, PWC, KPMG, Deloitte.

 

I am currently exploring, how to report the Ministry of finance and external affairs of India against negligence on the part of Upwork. 

 

My words might be harsh, but we are not getting any updates and responses from Upwork apart from the scripted replies. 

reyanshkharga
Community Member

Hi,

 

If Upwork is withholding some amount as TDS, why is it not being reflected in my form 26as of the income tax?

 

Can any Indian freelancer having a good understanding of the Indian tax system explain how you file tax returns for the income generated from Upwork?

 

Your help will be greatly appreciated. 

 

Thank you!

nayan-patel
Community Member

Is there any progress on TDS front from Upwork? Since I am not able to find any TDS credit on my TRACE account. Even for the October-December 2020 quater.