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Name on a received invoice?

Active Member
Egor S Member Since: Oct 19, 2015
171 of 235

@Joachim M wrote:

@Egor S wrote:

Hi Joachim,

 

Thank you for your informative posts. You mentioned in your previous posts that elance provides enough documents / information in case both parties are from EU. What are the process and applicable taxes (if freelancer and client do their business via elance) in case the client is outside of EU (the USA for example) and freelance is from EU (Germany for example)?


Hi Egor, with the freelancer in Europe and the client in the US (or any other country not member of the EU) no VAT is to be charged. On Elance most clients allow for their full address to be displayed on the invoice issued by Elance. I have to say most, as Elance does permit clients to hide their details and only their handle to be displayed. At the start of a fixed price job you can view the proforma invoice issued for the funding of escrow. If the information displayed doesn't suffice you can ask your client to provide all necessary details (the full address is sufficient). 

 

Problem is, Elance is being wound down, no new clients can register and soon now new jobs can be posted. 


 Kek, what we are supposed to do when elance will be closed? :/

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@Egor S wrote:

 Kek, what we are supposed to do when elance will be closed? :/


I will insist to issue my own invoices in Upwork adding VAT where necessary. Therefore I will need all address details of the client. If the client will not accept this I will not work for him. Unfortunately it is much additional work with the invoices. We now pay 10% instead of 8.75% in Elance and have additional work with the invoices. I would not do this for a very small job and would then prefer to abstain from the business. I only speak from a German point of view. The situation might be different for freelancers from the United States. Maybe everything is fine for them, I do not know.

Active Member
Wim J Member Since: Nov 24, 2014
173 of 235

Margarete M wrote

I will insist to issue my own invoices in Upwork adding VAT where necessary. Therefore I will need all address details of the client. If the client will not accept this I will not work for him. Unfortunately it is much additional work with the invoices. We now pay 10% instead of 8.75% in Elance and have additional work with the invoices. I would not do this for a very small job and would then prefer to abstain from the business. I only speak from a German point of view. The situation might be different for freelancers from the United States. Maybe everything is fine for them, I do not know.


 I agree, the freelancer should receive a copy of the automatic invoice that is given in the freelancer name to the client.

But it can be easily solved, just ask at the end of each quarter or the job done, the copy of the invoices given to your client by Upwork.  I do not see any problem for a business client not to give you YOUR invoices.

 

The only problem will be still the invoice number. What should be your number.

And all what you write by hand on that invoice, should again a copy be given to your client. A lot of work that Upwork should solve.

 

I hope they are listening.

 

There switch from Odesk to Upwork is understandable but some parts are still of the old Odesk. as the invoice numbers.

Community Guru
Joachim M Member Since: Mar 23, 2015
174 of 235

@Egor S wrote:

@Joachim M wrote:

@Egor S wrote:

Hi Joachim,

 

Thank you for your informative posts. You mentioned in your previous posts that elance provides enough documents / information in case both parties are from EU. What are the process and applicable taxes (if freelancer and client do their business via elance) in case the client is outside of EU (the USA for example) and freelance is from EU (Germany for example)?


Hi Egor, with the freelancer in Europe and the client in the US (or any other country not member of the EU) no VAT is to be charged. On Elance most clients allow for their full address to be displayed on the invoice issued by Elance. I have to say most, as Elance does permit clients to hide their details and only their handle to be displayed. At the start of a fixed price job you can view the proforma invoice issued for the funding of escrow. If the information displayed doesn't suffice you can ask your client to provide all necessary details (the full address is sufficient). 

 

Problem is, Elance is being wound down, no new clients can register and soon now new jobs can be posted. 


 Kek, what we are supposed to do when elance will be closed? :/


I'm doing the same Margarete suggested, write my own invoices. At present I simply quote including VAT and tell the client I can reduce the price accordingly if he either provides his VAT ID incl. address (resident in an EU member state) or only his full address (resident outside the EU). I don't check the address if outside the EU and if within the EU I merely check the VAT ID provided with VIES. I turn down jobs from EU members without VAT ID as I would then have to charge VAT and (possibly starting January) pay it in the client's country of residence. A no go for me, I'm not going to deal with 28 different tax offices.

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@Joachim M wrote:

I'm doing the same Margarete suggested, write my own invoices. At present I simply quote including VAT and tell the client I can reduce the price accordingly if he either provides his VAT ID incl. address (resident in an EU member state) or only his full address (resident outside the EU). I don't check the address if outside the EU and if within the EU I merely check the VAT ID provided with VIES. I turn down jobs from EU members without VAT ID as I would then have to charge VAT and (possibly starting January) pay it in the client's country of residence. A no go for me, I'm not going to deal with 28 different tax offices.


To be honest, I mainly follow Joachim's advice. He explained before how he handles the invoice problem. In the beginning I had absolutely no idea how to behave. At the end of the day we will see if the tax authorities will be happy with this solution. However, as Upwork charges the invoice to the client, I think there should be a remark on the invoice that it has already been paid to Upwork?? How do you handle this, Joachim?

Active Member
Egor S Member Since: Oct 19, 2015
176 of 235

Hi Margarete and Joachim, thank you for your answers. Just one more question appeared in my mind. In what currency (dollars or euro) do you issue invoices?

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@Egor S wrote:

Hi Margarete and Joachim, thank you for your answers. Just one more question appeared in my mind. In what currency (dollars or euro) do you issue invoices?


Egor, in my case the bid was in USD, the client from UK had to pay USD, in my invoice I converted USD in EUR and added to the invoice that the amount already had been paid. I do not know, if this is the best way to deal with the invoice and so I do not recommend anybody to do the same.

Community Guru
Joachim M Member Since: Mar 23, 2015
178 of 235

@Egor S wrote:

Hi Margarete and Joachim, thank you for your answers. Just one more question appeared in my mind. In what currency (dollars or euro) do you issue invoices?


The bid being in US$ I invoice in US$. Direct clients, outside of Upwork, I invoice in either Euro, US$ or GBP (UK clients). This will be agreed with the client beforehand. All direct clients resident in the EU pay by bank transfer anyway, it's the cheapest way. Everybody else pays by PayPal or Skrill. 

Community Guru
Joachim M Member Since: Mar 23, 2015
179 of 235

@Margarete M wrote:

To be honest, I mainly follow Joachim's advice. He explained before how he handles the invoice problem. In the beginning I had absolutely no idea how to behave. At the end of the day we will see if the tax authorities will be happy with this solution. However, as Upwork charges the invoice to the client, I think there should be a remark on the invoice that it has already been paid to Upwork?? How do you handle this, Joachim?

 Well, normally my invoice shows my bank account and the email address for PayPal and Skrill, all of it in the footer. For payments via Upwork I just add a single line right below the final amount: Payment via Upwork/Elance Escrow Service. That's it. It is anyway is transferred from Upwork to my PayPal account and from there to my bank account. I honestly doubt that I will ever be inspected anyway. 

 

And if anybody thinks all of this is far too complicated with Upwork, well, why not found a small business in Belize. Everything you earn beyond the borders of Belize is tax free and if the income is sufficiently high you can get a nomal credit card from your bank there.

Active Member
Wim J Member Since: Nov 24, 2014
180 of 235

 Well, normally my invoice shows my bank account and the email address for PayPal and Skrill, all of it in the footer. For payments via Upwork I just add a single line right below the final amount: Payment via Upwork/Elance Escrow Service. That's it. It is anyway is transferred from Upwork to my PayPal account and from there to my bank account. I honestly doubt that I will ever be inspected anyway. 

 

And if anybody thinks all of this is far too complicated with Upwork, well, why not found a small business in Belize. Everything you earn beyond the borders of Belize is tax free and if the income is sufficiently high you can get a nomal credit card from your bank there.


 It should be this: (or just the link to Upwork Terms & Conditions:

 

 

  • Now is mentioned "REMIT TO.... the address of Upwork"
  • Here should be written "remit to Elance Escrow Corporation followed by the address of this company:
  • Company No: C3049380
    Street 441 Logue Ave.
    Town: Mountain View, CA 94043
    Country: United States
  • for good understanding, a reference to the TERMS & CONDITIONS with the URL to it.
  • a part of that clause that explains the 3 way situation : clients pays to Elance as escrow that forwards the 100% to the escrow account of the freelancer and automatic deducts the 10% commission and forward that 10% commission to Upwork.   (as that is the way it works now)
  • 4.1 ESCROW ACCOUNTS: (of https://www.upwork.com/info/terms/ user agreement)
    Upwork Affiliate, Elance Escrow Corporation ("EEC"), provides Escrow Services to Clients and Freelancers to deliver, hold, or receive payment for an Engagement, and to make payments to Upwork. EEC is a licensed Internet escrow agent and holds California Department of Business Oversight License No. 963 5086. The Escrow Services are intended for business use, so you agree to use the Escrow Services for business purposes 
  • 5. CONTRACTUAL RELATIONSHIP BETWEEN CLIENT AND FREELANCER 5.1 Service Contracts https://www.upwork.com/info/terms/
    You acknowledge and agree that when a Freelancer accepts an Engagement awarded by a Client, the Client and the Freelancer will be deemed to have entered into a Service Contract with each other
  • 6. PAYMENT TERMS 6.1 Service Fee: https://www.upwork.com/info/terms/
    When a Client pays a Freelancer, or when funds related to an Engagement are otherwise released to a Freelancer as required by the applicable Escrow Instructions, EEC will credit the Freelancer Escrow Account and then deduct and disburse to Upwork a 10% service fee that Upwork earns and Freelancer agrees to pay Upwork for creating, hosting, maintaining, and providing the Site and Site Services (the "Service Fee"). If Freelancer elects disbursement in foreign currency, EEC will add Upwork's conversion fee of 1.5% to the spot rate quoted by its foreign exchange vendor and credit that amount to Upwork.

 

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