Value Added Tax (VAT)

[c1d89e0f]

I have just seen this message from Upwork:

"Tax Information - Additional Request

Value Added Tax (VAT)

To comply with tax laws, we collect tax on certain transactions. Even if you provide us with your Value Added Tax (VAT) ID we will still need to collect these taxes from you."

Nigeria does not issue a VAT ID for individuals. VAT ID is reserved for businesses, NGOs and other such organisations. Individuals, on the other hand, can request and be assigned TIN (Tax Identification Numbers). I have submitted my TIN. 

This message from Upwork, therefore, is as confusing as it is concerning. And if Upwork will collect tax regardless, why are they requesting VAT ID? Does Upwork realise that there are people from other countries with different Tax Laws?

[eloghosa_ihaza]

Couldn't agree more. I'm so confused rn.

Edit: I just found this FAQ page you can check out - Nigeria VAT for Freelancers – Upwork Customer Service & Support | Upwork Help

[c1d89e0f]

Thank you for the link shared, Eloghosa! That was mighty kind of you. 😊

I just went through the link and saw this:

"In Nigeria, your VAT ID is your personal or company Tax Identification Number that is issued by the Federal Inland Revenue Service (FIRS). It has 12 digits and should look like this, for example: 01012345-0001"

That is false and misleading information. For starters, VAT ID is issued by the FIRS strictly for companies. It is not "personal or company Tax Identification Number". And secondly, the TIN is 10 digits- not 12. Perhaps the Upwork team reading this could do with some clarity so others reading that page in future are not confused or misled.

Thank you again.

[58c5b2ec]

I was surprised to see that as well. I also visited the FIRS website attached to the FAQ page but it is what it is. I'll fill in my TIN and expect the deductions.

[c1d89e0f]

Hey Chioma... Do let me know whether it accepted your TIN. Thank you.

[aleksandra-r]

Hi, I am from Serbia, but this applies to me as well. Check this article for the reference Tax Update: VAT and SST - Upwork Community.

In my country, VAT ID applies to some businesses, and if you are a small business owner you are not subject to VAT. The same applies to individuals. If you are not subject to VAT, go to the Tax Information, scroll down to section 4 (its title is Value Added Taxes - VAT) and select an option that confirms you are not a subject of VAT. After that, save your changes and that's it.

But, by the end of April, we will all have to pay VAT on service fees, membership plans, and connects. The VAT doesn't apply to the money we get from our clients but to these 3 mentioned above.

[vami86]

I'm working as individual on Upwork. What I need to put in VAT?

Thank You, Aleksandra

[kochubei_valeria]

Hi Valentine and others,

We encourage you to check out the Product Update Aleksandra mentioned as well as the FAQs linked in it where you'll be able to find information specific to your country. If you have further questions after that, we recommend that you consult your local tax authority or tax advisor. We're unable to provide specific tax advice here.

Thank you!

[c1d89e0f]

Hi Valeria,

Thank you for your response. With respect to Nigerian Tax laws, your linked article, Tax Update: VAT and SST, correctly states "Please note that your VAT/SST ID is different from your tax identification number." This is true. In Nigeria, VAT ID is not the same as TIN.

However, another Upwork article, Nigeria VAT for Freelancers, gives completely conflicting information "In Nigeria, your VAT ID is your personal or company Tax Identification Number that is issued by the Federal Inland Revenue Service (FIRS). It has 12 digits and should look like this, for example: 01012345-0001"

The information in the latter article, with respect to Nigeria, is false and misleading. According to the FIRS, Nigeria's apex tax authority, TIN- which is issued, on request, to individuals, is different from VAT ID, which is reserved for businesses, NGOs and other such bodies. In addition, TIN has 10 digits, not 12.

If you could reach out to the Upwork team so that misleading information is corrected, that would be much appreciated.

 

[PradeepH]

Hi Valentine,

Thank you for taking the time to flag this. I will share this with the relevant team to review this further.

Thank you,

Pradeep

[c1d89e0f]

Hello Pradeep,

My pleasure. Happy to help.

And thank you too for helping out with the review!

[kochubei_valeria]

Hi Valentine,
I'd like to confirm that the article you were referring to has been adjusted. Thanks for flagging!

[coreliquid]

Good Morning, We are a Switzerland customer. Yesterday we received an email announcing that you start collecting VAT. I confirm that it mandatory for us in Switzerland to pay the VAT on external foreign services. We have already declared and paid the VAT for services done until the 31 December 2022 on Upwork here in Switzerland. Please do not charge this period because it is already paid on our side and do not want to pay twice. I tried to reach the support but there is no way to reach somebody. So that's why I am posting this request here. Let me know where I can have support/email to submit this official request. Thanks. Best regards. J. Kozma

[kochubei_valeria]

 Hi J. Kozma,

A member of our support team has reached out to you to assist further with your situation.