How Colombia VAT works for freelancers on Upwork

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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.

What is 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. Colombia requires Upwork to collect it and send it to the government of Colombia unless you provide a valid VAT ID, and we’re required to comply with the tax laws of countries where we do business.

What services does Colombia VAT apply to for freelancers on Upwork?

Membership fees
Connects purchases
Freelancer service fees

Since we charge tax when your government requires it, this tax may change or apply to additional services in the future.

What is the Colombia VAT rate?

It's 19% of the cost of the service being taxed.

Example: On $100 USD in Freelancer Service Fees, you will pay $19 in tax, for a total of $119.

You’ll see the estimated amount of tax on your invoices and on your transactions.

Am I required to provide a Colombia VAT ID to work on Upwork?

You're not required to provide your Colombia VAT ID, but if you do, we will not have to collect this tax from you.

You can enter your VAT ID in your tax information.

What is the Colombia VAT format?

Your Colombia VAT ID is 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.

How do I enter my Colombia VAT ID on Upwork?

Go to Manage finances > Tax information
Click on the pencil icon to enter or edit your info
Select Save

Once you enter your info, we’ll check whether the VAT ID you provide is valid and give you a prompt response when you enter it. You can also see your VAT ID status on your tax information page.

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 in your tax information.

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.

Who does Upwork collect VAT from in Colombia?

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.

Do I have to pay VAT if I am only residing in Colombia temporarily?

Yes. As long as your tax residence is set to Colombia, we’re required to collect them. If you move, update your tax information — we’ll adjust accordingly.

If I pay VAT before I enter a valid VAT ID for Colombia, will you refund that money once I enter it?

No, we send that money directly to the Colombia government and cannot 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.