Do anyone has any idea how to get an FIRC Certificate(Foreign Inward Remittance Certificate) from earning of upwork.
As per GST LAW which is applicable from 1st July. There is a 18% charge on any payments received as INR.
LFT payments are first converted from USD to INR and then it is transfered via bank to Indian bank.
But when u receive payments in INR then it does'nt qualify for GST 18% tax relief. Only the bank which does the converstion can provide this document. So local bank cannot provide since they received converted money only.
If we are able to get FIRC certificate then it can be proved that money was earned in foreign currency and it stands for tax relief.
Does anyone has any solution how freelancers from India can save there money from GST 18%
Solved! Go to Solution.
When using LFT, the services you provided are not counted as "Export of services". It's because the money is not landed in India in USD. It's converted by Upwork's bank(wells fargo) to INR first and sent to their partner bank in India who further transfer INR amount to you. Hence using LFT does not give relief in exempt from GST and you liable to pay 18% tax.
If you want to take exemption, you have to use wire transfer which satisfy the conditions of Export of services. Though it's costlier for small withdrawls but need to bear it to save 18% GST.
I hope it helps!
As we are India based company. we require to fill Softex. For this reason we need to submit FIRC from the receiver bank. I am not sure about others but whoever from India does work with foriegn need this FIRC copy to submit for compliance.
Attaching one link for your ref what exactly we need.
I hope this would resolve and we would get a complate idea and flow to receive this.
Please follow up on instruction shared in this thread by Vladimir, submit a support request and our team will be able to advise you directly. Thank you.
Any updates on this. I really need FIRC for upwork payment.
I am not sure about others reply ..
It would be great if you can list me process here.
I need FIRC (Foreign Inward Remittance Certificate) certificate for the work done and earnings in FY2014-2015.
I choose "Direct to Local Bank" transfer option. So need FIRC document from the intermediary bank that performed currency conversion (Dollars to INR), before transferring to my local bank account.
I am not sure if someone found a solution to this problem ( payment is received in INR to direct bank account & getting FIRC smoothly ) as I can't see someone mentioning it here.
I reached to Upwork chat support and was told that I have to request to my bank. I contacted my bank, they told Standard Chartered Bank will provide the FIRC. Now here I read that Wells Fargo converts and transfers INR from the US. So the receiving bank in India gets money in INR and no chance of getting FIRC. So this means businesses like us are liable to pay 18% GST here in India?
Is there any webpage by Upwork that clearly states the process & the contact phone no. or email id of the concerned bank where we can request FIRC or a solution to this problem.
A solution to the problem or a clear process will be highly appreciated.
Thanks Anthony for your prompt reply.
Wire transfer can be considered for future transactions, however I am asking for the transactions that are already done. I did local transfer in our financial year April 2019- March 2020 and now I have to file my company tax returns for which I need FIRC. I think Upwork should have been more friendly in providing such critical information as they know better about in & out of international businesses than small business houses like us.
While talking about wire transfer charges technically it is going to cost US$ 50-60. US$ 30 that Upwork is charging and rest US$ at our end while we receive the funds.
Can you help me with clear process to obtain FIRC for the local bank transfer that is already done? If there is no process or possibility to obtain FIRC for local bank transfer then I am sure everyone like me would be puzzled with the real utility of local bank transfer option, as everyone ( from India ) would have to pay 18% tax which in no case is profitable and suitable to any individual or business / agency.
Thanks Anthony for your inputs.
Earlier I thought you were from Upwork team, however later I realized the truth. The irony is nobody from Upwork team responded with a proper solution to this long pending and very important issue since 2017. The 'Direct to Local Bank' transfer of payment mode is not suitable to Indian freelancers as well as agencies. I am sure everyone who came to this discussion, must have struggled for the solution and had given up later.
The real question is how come Upwork didn't take care of this very important issue and not providing other easy solutions to Indian freelancers/agencies like Payoneer. Though Upwork support forum shows Payoneer ( https://support.upwork.com/hc/en-us/articles/211063988-Payoneer) as payment receiving mode however in India when clicking 'Get Paid' methods, Payoneer is not there. Payoneer offers free FIRC on their account.
So the bottom line is 'Direct to Local Bank' payment receiving method is not a useful method for Indian freelancers/agencies as this welcomes 18% GST. So for amounts greater than US$ 1000 Wire Transfer is the best method and for a lesser amount, PayPal is best as PayPal overall charges land up between 6.5% - 7.5%.
If someday Upwork support people check this message, I request them to look and resolve this long pending issue with a clear process ( it won't cost them to float a url ) and would make business easy and more respectable.
I have a solution to get automated FIRC and get the payment transferred to your bank account without any additional fees.
Payoneer provides FIRC document for every transaction (for India- through ICICI bank). But Upwork does not support Payoneer as one of the payments methods. Follow the below steps to make payment transfer between Upwork with Payoneer.
1) Get your account registered and verified at https://www.payoneer.com/
2) Register for Local US Bank account (ACH) - its free . https://www.payoneer.com/in/solutions/global-payment-service/
3) Add this newly created bank account as your default bank account in Upwork. Please note that the payment transfer from Upwork to US bank account is free .
4) Get the payment transferred to your ACH bank account and from there to your local bank account without any additional cost . Also, you get FIRC certificate for free (fees may be added in the future)
While Payoneer doesn't charge a fee for the bank transfer they do give about 1.5 - 2% less INR than the day's exchange rate.
Also how did you verify the Payoneer bank account on upwork?
I am also strugling for FIRC. and the informatin provide by the upwork, I have forwared to my bank ( ICICI) still my bank unable to provide me and other hand I am getting notice from the Govt. department.
I am realy helpless, Not sure where to go. Upwork says they will not provide and bank says they are not resposible for that , God only know where to go.
I also belive Upwork should provide us FIRC from his patner bank, anyway as per this thread discussion finally request should go to Upwork parner bank then logically Upwork should provide FIRC.
Recently even I got a notice from service tax deparment and they are asking for FIRC. Did you manage to get it? I am using Direct to Local Bank transfer for past few years.
Were you able to resolve this issue? Did Upwork or its partner bank provided FIRC?
How did the notice from governmwnt authorities ended? I mean, did they accept any of your proofs or they fined you?
I'm exactly in the same scenario where FIRC for past documents can save me else I've pay the penalties!
Did you had any luck with FIRC or with the authorities? I have been withdrawing money using local transfer from last few years and I am really worried that I will also end with in the same situation. Did you pay penalties or were you able to convince authorities?
I used to receive funds using LFT prior to GST registration. After regsitering with GST, I'm receiving funds using wire transfer. Should I try to get FIRC for the LFT I did prior to the GST period. I mean for the year 2016 to 2017.
Hi Abhishek, Is this solved yet? I am in the same boat and HDFC has refused to issue FIRC and asking me to contact intermediate Standard Chartered Bank. I have been withdrawing money via Local Transfer all these years and if FIRC is not issued, it will be a huge issue. I definitely will take it legally as eventually payments are coming from US only and we have fundamentally done nothing wrong.
were you able to sort this out. I am also in in the same situation as central excise dept asked me to produce the firc. they also told me - unless it is directly from the company I am working for it will not be consider.
I checked and it seems that you already created a support ticket regarding your concern. Please allow more time for our team to review your case and respond accordingly to your ticket. You will be notified of their response.
Hello Upwork team,
I am also having the same issue, I am using Local bank transfer to my ICICI bank and receiving payments in INR. So I need FIRC certificate for my Upwork earnings.
From now on I will be using WIRE transfer but for previous earnings, I need these certificates to show as proof of export of services while filing GST returns.
Please reply as soon as possible
Based on the conversation, it looks like Upwork is not the right platform for Indian exporters to get paid. FIRA (Formerly FIRC) is a legal document every Indian Software exporter must possess and file through SOFTEX to STPI according to FEMA act.