If further assistance is needed, please see a TL/SA. TL/SAs, if further assistance needed, please see #ask-taxes channel in Slack.
Resources:
Help Center article - same link included when we send the TDS amendments email to FLs
For any cases related to India taxes, please utilize ZD categories: Taxes > TDS
What is Indian TDS?
In India, TDS is a means of collecting an income tax from freelancers and agencies when they charge clients. Businesses are required to set aside a government portion for every payment they make in India, which is sent directly to the Indian government.
A law made effective on October 1, 2020, requires e-commerce operators outside of India (such as Upwork) to begin collecting TDS on payments made to service providers (such as the talent and talent agencies that use Upwork) based in India.
This means that if a freelancer/agency is based in India, we are required to withhold this tax from their earnings. We then remit what we collect to the Indian government.
The amount collected is determined by whether FL/agency provided a Permanent Account Number (PAN) to Upwork and have linked it to their Aadhaar number by the Indian government’s deadline of June 30, 2023.
GST vs TDS:
GST = (national sales tax that applies to any good or service) only applicable if both the freelancer and client are in India. More about GST can be found here > GST for Freelancers and Agencies in India
TDS = general income tax on all earnings regardless of where the client is from
Upwork’s network reaches over 180 countries around the world. Because each country has its own rules and regulations, some users have taxes that are specific to where they live and work. In India, this includes a number of unique taxes. One of these is Tax Deducted at Source (TDS).
TDS Amendment
An email communication will launch to all India FLs to inform them of the TDS amendments timeline.
Basically, the email instructs freelancers on how they can amend their TDS to their Report and the timeline (due dates) on when they can request that.
Here’s a copy of the email:
To clarify the timelines chart, for the freelancers’ finances report from Q1 particularly, April-June, Form 16A will be distributed on or before August 15. Once it’s distributed, freelancers will have until October 30th to send a request for any changes.
Amendment Request Process
Freelancers are to send an email to this address: taxinfo@upwork.com by the deadline (see chart in the email above). The Tax Team will respond acknowledging their request within 24-48 hours. Below are the items they’re required to include in their request:
- the e-mail address they have registered for access to Upwork
- the reason for their request
- the new PAN for their correction
They can also contact us if they’ve not received their original Form 16A by the designated time.
The tax team will review all Forms 16A, and amend when needed, that are part of correction requests sent to us by the applicable deadline. Requests received after this date may not be processed.
If the FL is asking about the status of their request, please reach out to your TL/SA so they can inquire using the Slack channel: ask-taxes.