Hi fellow freelancers,
I have some doubts with regar dto the accounting of my relationship with Upwork, and will appreciate your suggestions and solutions. As I am based in Europe, probably part of the questions related to the VAT are not relevant to the rest of you.
Here is my understanding on what we receive from Upwork for accounting purposes:
1. Invoice for the 10% Upwork fee plus the VAT on it if we are not VAT registered. This can be used for accounting purposes.
2. Screen information that I am charged $1.99 for the wire transfer. No document is issued and I guess this is not something I can account for as an expense.
3. Screen information about the exchange rate applied as normally the wire transfer automathically exchanges the USD for EUR. No document is issued and I guess this is not something I can account for as an expense.
4. This question is specifi for EU freelancers. I had to invoice a client for about $1.000 (amount for illustration purposes). As the client is not registered for VAT, I had to calculate the VAT and issue an invoice, As the VAT is 20%, my invoice was for $833 for services and the remaining $167 for the VAT. But Upwork is charging me 10% on the total amount of the money that go throu its platform, or $100. In reality it has to charge me $83; the remaining $17 are additional cost on something I am not getting.
Any ideas ho you hadle all these issues in accounting terms?