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Indian TDS Tax Withholding on Upwork Earnings

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Active Member
Aman S Member Since: Feb 10, 2016
51 of 121

Hi Joanne,

 

This means tax will be deducted on the 20% Upwork fee as well. Please verify understanding as it is important for reporting purposes. 

 

If I complete a fixed price job of $500 for a new client and Upwork deducts $100 (20% of the contract value) as an Upwork fee. In this case, Upwork will report my earnings as $500 and will deduct 0.75% on this amount, which is $3.75 instead of the actual amount I receive, which is $400 and TDS should have been $3.00 on this amount.

 

So, effectively I will end up paying tax on 20% Upwork fee as well which is taken off the top. 

 

Aman

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Moderator
Joanne Marie P Moderator Member Since: Nov 26, 2017
52 of 121

Hi Aman,

 

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. A law adopted in March 2020 requires foreign e-commerce operators, like Upwork, to begin collecting TDS on payments to service providers in India starting October 1, 2020. The amount of tax withheld is matched to the service provider by using their Permanent Account Number (PAN) or the Aadhaar number. The withholding tax is calculated based on the gross amount that the user invoices their client, so it is calculated prior to freelancer service fees or any other fees that may reduce the amount credited to the user’s account.


-Joanne
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Mohd S Member Since: Oct 10, 2019
53 of 121

This put's so much pressure on freelancer's.

Already we are losing jobs due to COVID-19 on top of that every 10$ we earn upwork keeps 2$ and then 1.5$ for only 10 connects then 0.99$ to transefer to the bank 

and now 0.75% which is supposed to increase to 1% in next year.

I agree that you're following just the guidlines of Govt. Atleast you can do it to wave off the transfer cost or lower the 20% comission. Providing free connects will not solve the problem as you might have already gussed then people will use it carelessly. But please don't put more pressure on us. It's not just about just 0.75% it's about the edge upto which we are loaded. you have the data with you, you know how many of us earn's (actuall bank trnsferred) more then 200$ per month . Please do somthing.

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Moderator
Nikola S Moderator Member Since: Jul 2, 2020
54 of 121

Hi Mohd,

 

We don’t plan to adjust fees. Upwork fees help to cover the costs of acquiring new clients and providing services like payment protection, customer support, and platform infrastructure. However, I will share your feedback with the team for consideration.

 

Thank you,

~ Nikola

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Pankaj R Member Since: May 4, 2020
55 of 121

Hi, I have checked the Tax Identification section in my profile and have confirmed my address. My Aadhar number was already saved. Can you please tell me how do I know that I've successfully completed my Tax Information update for TDS?

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Vladimir G Moderator Member Since: Oct 31, 2014
56 of 121

Hi Pankaj,

 

I checked and it appears you've successfully added your tax info details. We can confirm if the number you've added is in the correct format, which is the case here, and you can check to ensure the information entered there is current.

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Pankaj R Member Since: May 4, 2020
57 of 121

Hi Vladimir, thanks for your reply. I want to add that it's my PAN card number that was already saved before. And the PAN number that's saved is correct. Should I leave it be or replace it with my Aadhar number to complete the Indian TDS withholding process?

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Ace Contributor
Rahul B Member Since: Jun 5, 2019
58 of 121

Upwork is asking adhar card from Indian freelancers but where I need to give my adhar card number?

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Moderator
Luiggi R Moderator Member Since: Jul 3, 2020
59 of 121

Hi Rahul,

 

You may enter your PAN or Aadhaar number in the “Tax Info” section under “Settings". Feel free to check this announcement thread for more details.

 

Thank you.

~ Luiggi

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Ace Contributor
Rahul B Member Since: Jun 5, 2019
60 of 121

Hi have entered my adhar card number, What else I need to do?

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