Try making sure your pan has the same details as provided for your profile. It might be a general issue since it's a new thing. Wait for them to solve it and don't worry if it's 5% even after change since you can claim it when filing taxes next year.
Thanks for the follow-up. I've checked your account and will follow up with our team to investigate further. I'll provide more information as soon as possible.
TDS needs to be charged on the payment made to the contractor and not on the fees that Upwork withholds before paying the contractor. You cannot withhold the tax for the amount you are not actually sending into India, but are retaining in another country. Can you please explain?
The TDS explained on the Help page says this.
In India, Tax Deducted at Source (or TDS) is a means of collecting an income tax. Businesses are required to set aside a government portion for every payment they make in India, which is sent directly to the Indian government.
A law enacted in March and effective as of October 1, 2020, requires e-commerce operators outside of India (such as Upwork) to begin collecting TDS on payments made to service providers (such as the freelancers and agencies that use Upwork) based in India.
Upwork fees is not paid to the service providers, so why is TDS withheld on that amount?
Sukanya made a right point.
Upwork should withhold tax only for what freelancer earns. Not including upwork's fee.
I am seeing 0.75% deducted for the total amount client paid (including upwork fee).
Indian tax department will calculate the total amount (including upwork fee) as taxable based on TDS remitted. It is unfair.