should I just remove my VAT number from my profile?

[nextrian]

Hi,

I've recently created my company in Belgium, and an Upwork account so that I can find freelancing work to finance my business. So I've added my VAT number and it's finally been validated (it's a new one so it took a few days). 

But I'm in a particular regimen call franchise that specify that until I hit 25k/year, I should:

- pay VAT on my purchases,

- NOT be charging VAT to my clients for the time being

If I understand the documentation correctly, I should remove my VAT number from the tax information in my profile in order to 1/ pay VAT on anything I pay Upwork 2/ not charge VAT to my clients

Is that correct? Should I just remove it?

All the best,

Vincent.

[g_vasilevski]

Hi Vincent,

Upwork charges the country-specific Value Added Tax (VAT) to freelancers and agencies in the European Union (EU), unless you provide a valid VAT number. VAT will be assessed on services provided by us, not on services you provide your clients. To learn more about VAT check out this Help Article. We won't charge VAT if a freelancer or agency has a valid VAT number added on their account. 
For any other questions regarding your VAT please consult with a local tax specialist. Thank you!

[nextrian]

Hi Goran,

Well I need Upwork to charge me for VAT and I can't charge VAT (for the time being, ie, until I hit 25k/year). So from what I understand that's what is happening if I DON'T give a VAT number in my profile.

But the 'tax information' in my account settings states that I should give a VAT number if I reside in a country that supports VAT, hence my question.

I don't see anything in the settings that says something like "I have a VAT id but still need you to charge it to me and I can't charge it to clients", so my guess is that I have to remove my VAT id if this is what I want, and I'd like either a confirmation of that or an alternative 🙂

All the best,

Vincent.

[VladimirG · Accepted solution]

Hi Vincent,

Please note that VAT is being assessed on services provided by Upwork, not on services you provide your clients. Upwork is charging VAT on the services provided to you, including the service fee, purchase of add-on Connects and Plus membership fee. VAT is not being charged on your earnings from your clients. That is a separate question and you should consult your tax advisor whether to charge your client VAT for your services. 

Upwork won't charge VAT if you provide a valid VAT number. When Upwork is audited by your government, we are required to substantiate that we have charged VAT to all VAT non-taxable persons, and that we have reverse-charged VAT to all taxable persons. The only way we can confirm and prove to your government that you are a taxable person is by collecting and validating your VAT number. Otherwise, your government will assume that Upwork is providing services to a non-taxable person and will require us to assess VAT, regardless of your personal status.

Please do check the Help article Goran linked in his post for more information and let us know if you need further clarification.

[nextrian]

Hi Vladimir,

I've read the article, thank you for the clarifications. I'll remove the VAT id for the time being, I need upwork to collect VAT from me until I hit 25k and have to switch to a different VAT status in Belgium.

Thanks,

Vincent.

[petra_r]

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@Vincent B wrote:
So from what I understand that's what is happening if I DON'T give a VAT number in my profile.

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 Correct 🙂

[nextrian]

thanks 🙂