[Updated February 14, 2022] Starting early next year, we will begin collecting Ukraine’s Value Added Tax (VAT) when talent and clients registered in Ukraine and who do not have a valid business tax ID purchase Upwork services. Ukraine signed a new law on June 29, 2021, requiring Upwork to collect VAT for B2C transactions (see below for more on what qualifies as a B2C transaction). We began collecting this tax on February 14, 2022.
VAT will be charged on fees paid to Upwork, including:
- The amount talent pays for Connects
- Membership fees (for example, for a Freelancer Plus plan or Client Plus plan)
- Freelancer service fees
- Client payment processing fees
- Featured Jobs (tax will be applied to the cost of post, which is currently $29.99)
- Enterprise Subscription Fee
- Enterprise Billing Fee
- Enterprise Service Fee (Multiple)
Note: We will not charge VAT on the amount the client pays the freelancer for their services or on any withdrawal fees.
As this tax is being collected on B2C (business to consumer) transactions, any user that has provided Upwork with a valid VAT ID will not be treated as a “consumer” and therefore will not be subject to tax. You can add your VAT ID in the Tax Information section of Settings. A 12-digit VAT ID or 8-digit business registration number, rather than a 10-digit personal Tax ID, is required in order to be exempted from this tax collection.
This article does not address all tax issues for freelancers, and you should not rely on it as legal advice. We strongly encourage readers to seek tax advice based on their particular circumstances from an independent tax advisor.