Colombia imposes a 19% VAT on Upwork services such as Marketplace Fees and Featured Job posts. Upwork collects this tax unless clients provide a valid Colombia VAT ID. While not mandatory, submitting a VAT ID exempts you from charges being collected by Upwork. VAT status adjusts with tax info changes and must be revalidated as needed.
What's the Colombia VAT and why does Upwork collect it?
Value-added tax, or VAT, is a tax on goods or services, including our services to you, and Colombia requires Upwork to collect it and send it to the government of Colombia unless you provide a valid VAT ID.
We’re required to comply with the tax laws of countries where we do business to operate there.
What services does Colombia VAT apply to on Upwork?
Examples of services for clients that VAT applies to:
- Marketplace Fee
- Contract Initiation Fee
- Conversion Fee
- Recruiter Fee
- Featured Job post purchases
Since we charge tax when your government requires it, this tax may change or apply to additional services in the future.
What's the Colombia VAT rate?
It's 19% of the cost of the service being taxed.
Example: On $100 USD in Client Marketplace Fees, you will pay $19 in tax, for a total of $119.
You’ll see the estimated amount of tax when you check out and on your invoices and transaction history.
Am I required to provide a Colombia VAT ID, and what happens if I do?
You're not required to provide your Colombia VAT ID, but if you do provide it:
- If you provide a valid VAT ID to Upwork in you Tax information, we will not have to collect this tax from you
- We’ll check whether the VAT ID you provide is valid and provide you a prompt response. You can also see your VAT ID status on your Tax information page
- The VAT ID you provide displays on your invoices. To change what displays there, you'll need to update your VAT ID
What's the Colombia VAT format?
Your Colombia VAT ID number a unique ID that you may request from your government by registering for VAT in Colombia — not your tax ID number. It may have 9 or 10 alphanumeric characters, depending on whether you are an individual or a business. It starts with a number and can end with a letter — like this, for example: 01234567A or 012345678A.
To learn more, visit the Colombia tax authority’s website.
Does Colombia offer any exemptions to VAT?
Colombia does not offer any applicable exemptions from VAT on services that Upwork provides, but you can avoid VAT charges being collected by Upwork by providing a valid VAT ID.
What happens to Colombia VAT if I change my location or other information?
If you update your tax residence in your Tax information, we'll automatically adjust your VAT based on your new country's rates, if any.
You may have to revalidate your VAT ID when you change locations, or if you make other changes to your information, such as changing your legal name.
Disclaimer:
This article is for general information only and should not be considered tax advice. It may not be updated in real time and may not reflect recent changes. We strongly encourage you to consult your country’s tax authority or your tax advisor with questions related to your specific situation.
Frequently Asked Questions
Colombia’s VAT applies to services we provide to both freelancers and clients if they reside, have a permanent address, or are established in Colombia and have not provided us with a valid VAT ID.
We are still required to collect VAT even if you are only residing in Colombia temporarily. If you move to another country, you can update and update your tax residence in your Tax information. We’ll automatically adjust your VAT to correspond with the rates in your new country of residence or stop collecting if there is no VAT, or a similar tax, in your new country.
No, we remit that money directly to the Colombia government and will not be able to refund it. You may be able to claim a credit with your tax authority for what you paid. We recommend that you consult with your government’s tax authority or your tax advisor for more information.
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