Fixed-price contracts

[maharshi14]

I have made my Upwork account, however my tax information (VAT id for Germany) will take around 6 weeks to arrive. I already have a client that wants to hire me on a fixed price contract starting two months from now. Can I still start that contract two months ahead of time while I wait for my tax id? I want to do so to make it official. Thank you.

[AleksandarD]

Hi Maharshi,

Thanks for reaching out to us. If you do not have a VAT number yet, you can continue working as usual, but please know that Upwork will add your country-specific VAT to our service fee. You’ll see an extra VAT charge on the transaction screen, in addition to the service fee once you start earning. If you have a VAT number, Upwork will not charge this tax but we will print 'VAT Reverse Charged' on your invoice. Please check out this help article for more information.

Thank you.

[maharshi14]

Hi,
Thanks a ton for this, but I think my situation doesn't fit the norm. I want to start working on my fixed price contract from October, since by the last week of September I should obtain my VAT id. I would only start using Upwork after I get the VAT id and fill it in. But, can my client already offer me a fixed price contract that starts from October (so 3 months in advance) now?
Thank you!

[AleksandarD · Accepted solution]

Hi Maharshi,

Thanks for following up. As you are looking forward to having a Fixed-Price contract with this client, it might be beneficial to know that if your client creates a contract and funds the escrow, but you can't start working and can't get paid yet until several months from now, the funds in Escrow might auto disburse back to the client and the contract may just close following a period of 90 days of inactivity. Please check out this help article for more information on that and this one for Payment protection.

In the event where the client opens a contract and doesn't fund it, and if the contract remains open without funds for very long, this may not be beneficial for your future Job Success Score because the contract will be left idle for some time. You can learn about the Job Success Score here in this help article.

Thank you.

[maharshi14]

Hi,

That was super helpful, thank you very much!

[martina_plaschka]

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Maharshi C wrote:
Hi,
Thanks a ton for this, but I think my situation doesn't fit the norm. I want to start working on my fixed price contract from October, since by the last week of September I should obtain my VAT id. I would only start using Upwork after I get the VAT id and fill it in. But, can my client already offer me a fixed price contract that starts from October (so 3 months in advance) now?
Thank you!

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You don't need to have a VAT number to work on upwork.

Don't accept any contract that you will not start to work on immediately, this rarely ends well.

[maharshi14]

Yes of course, but I would need it to withdraw the money right?

Also, why not? Once my client has deposited the money in the escrow, my impression was that those funds cannot be released back to my client without my permission, and vice-versa?

Thank you!

[martina_plaschka]

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Maharshi C wrote:

Yes of course, but I would need it to withdraw the money right?

Also, why not? Once my client has deposited the money in the escrow, my impression was that those funds cannot be released back to my client without my permission, and vice-versa?

Thank you!

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You absolutely do not need a VAT number to withdraw money. 

If money is in escrow it will be automatically returned to the client after 90 days because upwork is not a bank and will not hold it any longer. This will in turn be bad for your rating if you have a job for such a long time with no money paid. Did you not read what Aleksander replied to you?

You seem to be unaware or misinformed about many things regarding upwork. Don't do anything before reading and learning all about procedures, rules and regulations. 

[maharshi14]

Yes, I read what Aleksander replied to me, and I took into account the 90 days he mentioned. Based on that information I thanked him, meaning I understood what he said. Keeping the current date in mind, my client would only start the contract when doing so is possible with the 90 days taken into account. 

In this link: https://support.upwork.com/hc/en-us/articles/211060918-Manage-How-You-Get-Paid

it says, "In order to access your earnings, you'll need to add a payment method and set your tax status."

I assumed setting my tax status would mean informing Upwork about my tax number.

[martina_plaschka]

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Maharshi C wrote:

Yes, I read what Aleksander replied to me, and I took into account the 90 days he mentioned. Based on that information I thanked him, meaning I understood what he said. Keeping the current date in mind, my client would only start the contract when doing so is possible with the 90 days taken into account. 

In this link: https://support.upwork.com/hc/en-us/articles/211060918-Manage-How-You-Get-Paid

it says, "In order to access your earnings, you'll need to add a payment method and set your tax status."

I assumed setting my tax status would mean informing Upwork about my tax number.

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Keep in mind that upwork is a US based company and that is a bare minimum of information for people in the US. They will never give any tax advice on the ROW people. 

[maharshi14]

Hi,

With these threads I understand the situation better: 

https://support.upwork.com/hc/en-us/articles/211061278-EU-Value-Added-Tax-VAT-

https://community.upwork.com/t5/Freelancers/Issue-with-VAT-and-invoices-in-Germany/td-p/304926

Thank you Martina

[martina_plaschka]

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Maharshi C wrote:

Hi,

With these threads I understand the situation better: 

https://support.upwork.com/hc/en-us/articles/211061278-EU-Value-Added-Tax-VAT-

https://community.upwork.com/t5/Freelancers/Issue-with-VAT-and-invoices-in-Germany/td-p/304926

Thank you Martina

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Welcome. My advice to you is never assume anything on upwork or related issues, just ask before you go wrong.