2 times upwork fee?? Where does my money go?

[Annika S]

I earned 30 $. Upwork already took a fee of 6 $ so I only receive 24$.  

Now before paying me they again charge 1,12 $ and for paying they charge 0,99$.

The 0,99 $ is for bank transfer, but what about the 1,12$??? Why they charge again this kind of fee??

thank you so much for answering!!

[Petra R]

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Annika S wrote:

I earned 30 $. Upwork already took a fee of 6 $ so I only receive 24$.  

Now before paying me they again charge 1,12 $ and for paying they charge 0,99$.

The 0,99 $ is for bank transfer, but what about the 1,12$??? Why they charge again this kind of fee??

thank you so much for answering!!

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VAT on the Upwork fee. Check your Reports > Transaction History

[Annika S]

But i dont have a VAT number and I am not from the US - so why they charge me VAT fee?

[Petra R]

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Annika S wrote:
But i dont have a VAT number and I am not from the US - so why they charge me VAT fee?

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For the same reason you pay Mehrwertsteuer (VAT) when you go shopping in Germany or buy stuff on the Internet and on everything else you buy.  All EU freelancers pay VAT which is required by law and paid to the German Finanzamt on your behalf.

[Annika S]

But here I am not buying something - I am earning money. In Germany I only pay Mehrwertsteuer when i buy something. When I earn money I dont have to pay taxes until I earn a specific amount of money. So why does upwork take this fee and pass it to the German finanzamt?

[Petra R]

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Annika S wrote:
But here I am not buying something - I am earning money. In Germany I only pay Mehrwertsteuer when i buy something. When I earn money I dont have to pay taxes until I earn a specific amount of money. So why does upwork take this fee and pass it to the German finanzamt?

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Seufz.

You are buying Upwork Services. That is why you pay VAT on the Upwork Service fee (NOT on what you earn.)

Pretty much the same as you pay VAT on eBay seller fee and so on. You pay Mehrwertsteuer on goods and services you buy.

[Annika S]

Ok. Thanks for your answer. I have to accept it. But still seems strange to me. Until now when I bought something in a country that is not Germany (and upwork is not a german company is it?) the institution I buy things from never gave Mehrwertsteuer to Germany and to the German Finanzamt. That only happens when I buy german products.



But ok, like I said I have to accept. Seems like something I now nothing about.



Upwork wrote me that soon they will charge a little amount for every job proposal i Make. Will the then always additionally request VAT from me for every proposal i make?

[Petra R]

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Annika S wrote:
Ok. Thanks for your answer. I have to accept it. But still seems strange to me. Until now when I bought something in a country that is not Germany (and upwork is not a german company is it?) the institution I buy things from never gave Mehrwertsteuer to Germany and to the German Finanzamt. That only happens when I buy german products.

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It has been the case for a few years now. Read more of the legal jargon here.

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Annika S wrote:

Upwork wrote me that soon they will charge a little amount for every job proposal i Make. Will the then always additionally request VAT from me for every proposal i make?

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Yes, any services you buy frm Upwork will have VAT added

[Annika S]

Ok, so what will I pay for every proposal? Because I think it was something like 0,15 $, but with VAT it will be even more, right?

[Petra R · Accepted solution]

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Annika S wrote:
Ok, so what will I pay for every proposal? Because I think it was something like 0,15 $, but with VAT it will be even more, right?

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$ 0.15 + VAT