I've been working for several clients on Upwork for a while, but am just now getting familiarised with taxes and all that.
I'm afraid my income will come down to nothing after paying for IRS, SS and IVA...
What's a realistic amount to pay for that if I make around $500/month?
Thanks in advance.
Silvia P, If your last year income was below 10'000€ in total, you don't pay IVA.
IRS for Atividades nos ramos artístico, técnico ou cientifico (us) is 20%
SegSocial you pay 21,4%, but you can ask reduce your "escalão" down two steps (will be about 16%)
I.e. 36% of taxes in total
ave one Hello Kristel,
Thank you for all your support
I have one doubt. My invoices (recibos verdes), I am putting the total amount I received at my bank account. So reading your post got me confused "The invoice that you pass it's the Upwork Invoice that you receive at the end of your work (with the total of $work), so you need to calculate very well you work price because this is going to enter to your taxes."
Do I have to add the upwork fee value to the invoice? I am just adding the final value, that I actually received...
Thank you in advance,
You need to submit the invoice/recibo verde with the total amount of the invoice that you received from Upwork and billed to your client (= the amount that you received + fees of Upwork). The charges of Upwork is a payment that YOU and only YOU made...not the client responsibility, so it is not deductible on the invoice that you are filling.
If you are on "Regime de Contabilidade Simplificada" (the most common), only 75% of your income will be deductible to tax/IRS. The other 25% are automatically seen as "despesas de trabalho." On this "Regime de Contabilidade Simplificada" you can't make official invoices of your expenses. When you make an invoice/recibo verde with the total of your official invoice (with the upwork taxes), 25% percent of this amount will be reported as job expenses – since the upwork fees are 20%-10%-5%, it's ok ;-)
If you are on "Regime de Contabilidade Organizada" you also fill a recibo verde with all of the amount shown on your Upwork Invoice, but you can submit the other invoice that Upwork sends you with the fees as a job expense.
I wrote last week a post about this in Portuguese, if you want to read: https://www.nomadismodigital.pt/upwork-portal-das-financas/
I'm amazed how you help people and share your experiences about being freelancer. Very much liked it. I'm also living in Portugal/Porto. Naturally im from Turkey, came to portugal for master but with some reasons i didn't finish yet. Last summer i started getting jobs from Upwork and each day my network is expanding. So i thought maybe i should somehow start my activity in Portugal. I just have NIF number, i don't have any VAT or other things. I would like to register myself as freelancer and declare my earnings since i've been here and earning money for sometime. Just i dont know how and where to start this. Can you help me?
Great to see there's already a considerable amount of people from Portugal on Upwork. With our economic climate, this type of work will definitely continue to grow - might as well take advantage of it!
I'm from Porto by the way. Keep up the good work!
I am also a Portuguese freelancer working here, and I have just ran into this group.
I have tried to find answers to my questions, but since I'm really new to accounting and finance, I figured I would ask in case someone can help me in simple terms
I have been working here since June last year, and I have been withdrawing relatively small amounts each month. However, things are thriving now, and I have just landed a big project that has made me reflect upon my financial situation. The only freelancing work I do is on this platform, and I am currently studying, so, I have no other job. I am working here mainly to build my CV and get some side earnings to finance my studies. I have found articles on-line saying that if this is just temporary work, I might not need to register and declare my earning officially. Is this correct? And is it still true for a project in which I will earn 1000€+? Should I register in "finanças" as an independent worker, with the simplified regimen? Which taxes will I have to pay?
Sorry about all the questions, and best of luck to all my fellow "tugas" working here
I was also interested to know the answer to this question, i have read a
few other similar subjects and the answer that i found was to contact an
accountant and discuss with him. I know the laws are a bit different in
every country, i found my answer to this question by contacting an
I hope this will help you as well.
Just wanted to remind to everyone, that Segurança Social changes rules this year. Now we need to submit a SegSoc declaration every 3 month on their site. And based on these 3-month earnings they's recalculate our tax step (how much to pay). You can ask to reduce your tax step 2 steps below. The first declaration is to be filled till 2019-01-31 (next Thursday)
Also there is no exemption of SegSocial any more. Even if you had no income, you have to pay 20€ to SegSocial every month.