Understanding Upwork Fees for Freelancers

Introduction

As a novice freelancer on Upwork, it’s crucial that you understand how the platform’s fee structure works because it directly affects your potential earnings. Upwork uses a sliding fee structure that is determined by the lifetime billing with your client. This can range from 5% to 20%, depending on the total amount you’ve billed that client.

The Sliding Fee Structure

• 20% for the first $500 billed with the client
• 10% for lifetime billings with the client between $500.01 and $10,000
• 5% for lifetime billings with the client that exceed $10,000

Examples:

For instance, if you complete a project worth $300 for a new client, Upwork will deduct a fee of 20%, amounting to $60. Therefore, the net income that you’ll receive will be $240.
On the other hand, if you’ve already billed a client for $12000 on previous projects, you’ll only be charged at 5%. This means, if you bill an additional $1000 for a project, Upwork will deduct a fee of $50, providing you with a net income of $950.

It’s important to remember that these fees are deducted automatically before the funds reach your account. Remaining aware of this fee structure can help you in setting appropriate pricing for your services.

Other Possible Costs

Besides the sliding fee, there might be additional charges like a payment processing fee and a fee for currency conversion if you’re working with international clients. It’s always a good idea to research these potential costs beforehand.