VAT number and Service Fees

[lismey]

Hello guys!

Question: if I get the VAT number in my country, then Upwork won't take the percentage of Service Fees from every contract that I have? or are they two different things?

Thanks in advantage,

[martina_plaschka]

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Lismey V wrote:

Hello guys!

Question: if I get the VAT number in my country, then Upwork won't take the percentage of Service Fees from every contract that I have? or are they two different things?

Thanks in advantage,

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Two completely different things. Upwork collects a fee, your government collects taxes. If you are the holder of a VAT number, upwork will not charge you VAT, if you don't have a VAT number, you have to pay VAT.

For example, if I have no VAT number in Austria, it works like this:

Job is for USD 100, new client, upwork withholds a fee of USD 20, the relevant VAT of 20% is charged on the fee (USD 4) and paid by upwork to the tax people in Austria, so I receive USD 76. 

The USD 76 are gross income, so after deductibles I have to pay income tax on my income. Again, totally different tax.