Everything you need
to know about all types
of Upwork fees
Did you even wonder what are ALL the existing Upwork fees? Here is the post that answers this question.
1. Upwork fees for freelancers:
Up until a recent update, Upwork had a sliding fee % depending on your lifetime earnings with each client. Beginning May 3, 2023, all freelancers are moving to a 10% fee rate. For those currently working on projects at the 5% level, those rates will still apply through the end of 2023.
❗️ Direct Contracts & Bring Your Own Client (BYO) have different fees.
- BYO means that a client registers on Upwork from your referral link. Top Rated freelancers who bring their offline clients to Upwork (and the client creates an account for the first time) are eligible for 0% on fees with the new clients they bring (for all future contracts). Even if you lose your TR status, you’ll continue to pay a 0% fee on these contracts.
- Direct Contracts (DC) means that a client doesn’t create a regular account, just uses the payment functionality. For DC freelancers pay a processing fee of 3.4% of the total contract amount but don’t pay any freelancer service fees to Upwork.
💰Value Added Tax (VAT)
VAT is charged by Upwork, but then Upwork transfers it to the country of the freelancer. Usually it’s around 20%, but varies depending on the country.
Upwork will collect VAT the following transactions if you don’t provide a valid VAT ID Number or 8-digit business registration number to be considered exempt:
- Freelancer service fees (not your earnings)
- Connects purchases
- Membership fees
Important to note that Ukrainians do not pay VAT on Upwork since the beginning of the full-scale invasion.
2. Upwork fees for clients:
- Clients pay a 5% Client Marketplace Fee on all payments that they make to freelancers for fixed-price and hourly jobs, Project Catalog projects, bonuses, and BYO contracts.
- Beginning April 26, 2023, clients also pay a new contract initiation fee of up to $4.95 on Upwork’s Marketplace and Project Catalog. This is a once-per-contract fee, assessed when clients make their first payment to a freelancer.
- Clients using Direct Contracts pay 3% fees on PayPal and credit card charges.
😭 Also, don’t forget about the connects! Although, those are not fees per se, but this is definitely a huge bulk of $ that we pay to Upwork (which seems to grow more and more lately).
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