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International pay and taxes

flanderspub
Active Member
Bettianne F Member Since: Dec 11, 2019
1 of 3

I see two issues with the payment system for Upwork for international freelancers. First, if you live internationally, then Upwork is passing on their cost of business, the international taxes charged, to the freelancer. Secondly, when you work internationally, you get paid in USD which, in some cases, are lower than the currency of your country. It can also be lower than the currency of the client's country. In a case where someone lives in Europe and is hired by a European client, for example, the freelancer has to pay Upwork's cost of doing business in Europe by paying their taxes and they are being paid in USD which is about 30% lower than their take home pay in Euros. Plus, they'll have to pay their own international taxes on top of the fees paid on Upwork's behalf. We already have to lower our overall asking price to fit into a US-based market, which often hires freelancers at a far lower rate of pay than markets outside the US. By the time the fees, Upwork's taxes and exchanges are taken out, we are often working for less than the American minimum wage and that is before we have to pay our own taxes and overhead for our business. 

feed_my_eyes
Community Guru
Christine A Member Since: May 4, 2016
2 of 3

Bettianne F wrote:

I see two issues with the payment system for Upwork for international freelancers. First, if you live internationally, then Upwork is passing on their cost of business, the international taxes charged, to the freelancer. 


Your post is entirely devoid of logic. Of course in Europe we have to pay VAT on everything; this has nothing to do with Upwork, so why should they eat the cost for us? 

 


Secondly, when you work internationally, you get paid in USD which, in some cases, are lower than the currency of your country. It can also be lower than the currency of the client's country. In a case where someone lives in Europe and is hired by a European client, for example, the freelancer has to pay Upwork's cost of doing business in Europe by paying their taxes and they are being paid in USD which is about 30% lower than their take home pay in Euros. 

There's no rule that says if you charge 10 euros per hour, you have to charge 10 dollars per hour. Simply look up the currency exchange rate and adjust your fees accordingly.

 


Plus, they'll have to pay their own international taxes on top of the fees paid on Upwork's behalf. We already have to lower our overall asking price to fit into a US-based market, which often hires freelancers at a far lower rate of pay than markets outside the US. By the time the fees, Upwork's taxes and exchanges are taken out, we are often working for less than the American minimum wage and that is before we have to pay our own taxes and overhead for our business. 

Yes, we have to pay taxes - everybody does. You need to take your taxes and expenses into consideration when you set your rates; that's how people run a business. You do NOT have to lower your asking price to fit into the U.S. market.

petra_r
Community Guru
Petra R Member Since: Aug 3, 2011
3 of 3

Christine A wrote:


Your post is entirely devoid of logic.


I got as far as "Secondly, when you work internationally, you get paid in USD which, in some cases, are lower than the currency of your country." and abandoned....

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