How Much Does Upwork Take From Freelancers & Clients [ Explainer]

Do you plan to start offering your services on Upwork and you are asking – how much does Upwork take from freelancers? No worries! As a one-time freelancer on Upwork, I will explain to you in this post how much Upwork charges freelancers for any sale they make.

My goal is to keep you informed so that you can decide if the fees on Fiverr favor you. I will also answer other questions that relate to charges Upwork takes from freelancers.

How much does Upwork take from freelancers?

The fees Upwork takes from freelancers anytime they make a sale varies. It is not like the 20% fee which Fiverr takes from every sale a freelancer makes. 

Let’s look at them below

• $0-$500 in earnings from a client: 20% service fee applied to earnings
• $500.01-$10,000 in earnings from a client: 10% service fee
• $10,000.01 or more in earnings from a client: 5% service fee 

Going by the fees stated above, it shows that the higher you earn as a freelancer on Upwork, the less you pay as service fees. 

For example:

Upwork takes a 5% service fee for earnings above $10,000 and a 20% service fee for earnings between $0 and $500. 

One can easily deduce that Upwork encourages you to bid for projects that will earn you over $10k so you enjoy a 5% service fee.

What is a service fee on Upwork?

This is the fee Upwork takes any time you make a sale on their platform. It is for allowing you to use their platform to sell your services and make money.

Upwork spends a huge amount of money on maintaining its website and building a brand clients trust to hire freelancers that can deliver high-quality services. They also have a big budget for advertisement and want to grow their revenue.

That’s why they charge service fees. Let’s assume you want to advertise your digital skills for people to hire you, you must spend money to promote your services to businesses it may interest.

So, it’s a win-win with Upwork. You sell your services on their platform and earn money, a certain percentage is taken for every sale to maintain their platform. 

Upwork service fee vs Fiverr service fee?

Fiverr is a strong competitor of Upwork. It is worth comparing their service fees. Fiverr takes 20% of every sale you make as a freelancer on their platform. Even clients who hire freelancers on Fiverr pay 5.5% of the total amount of gigs they ordered.

So whether you are a buyer or seller, Fiverr has a cut in whatever you spend or earn. Upwork service fees vary and it favors top-rated freelancers who bid for juicy projects that can earn them more than $10k.

A service fee of 5% for a sale that is over $10k while a 20% service fee is applied for sales $0-$500. Clients on Upwork are charged 5% of the total amount they paid for purchase as processing and administrative fees. If you are in the United States and you pay via ACH, it’s 3%. 

Is the lower service fees a reason to consider selling your services on Upwork as a freelancer?

Yes, since the service fee varies and is lower when you make sales above $10k compared to the 20% service fee Fiverr takes from every sale you make. However, it is important you know that freelancing on Upwork is more competitive.

Freelancers with little or no ratings and positive reviews find it difficult to get hired even when they charge lower fees. Big brands with deep pockets see ratings and positive reviews as a vote of confidence your previous clients passed on you.

That’s the only way to believe you can deliver. On Fiverr, you can land gigs easily as a beginner with no ratings and reviews.

With lower fees for your services, clients on a low budget may want to give you a try. You can leverage that to boost your profile as many sellers will leave positive reviews about your service. 

Benefits of being a seller on Upwork that outweighs the service fees you pay

Before you complain about the service fees on Upwork, consider the following benefits of being a freelancer on Upwork: 

1. A brand with a good reputation 

The fact remains that many businesses prefer Upwork over Fiverr when it comes to hiring freelancers that can deliver high-quality jobs.

Being a freelancer on Upwork gives you an edge over freelancers on other freelancing platforms. You brag about it in your resume even after you quit Upwork as a freelancer.

2. You can earn more

As clients on Upwork look for freelancers that can deliver high-quality services, so do they have huge budget for it. You hardly see clients posting jobs of $5 or $10 on Upwork. But you can buy a gig on Fiverr for as low as $10. Clients on Upwork have big budgets for their projects and they can hire you if your reviews and ratings show that you are good at such a project. 

3. You are encouraged to acquire more skills

There are high-paying projects on Upwork you can’t bid for unless you are certified to have acquired the required skill. This encourages you to work harder to acquire them. For example, a client who is looking for a software developer can make it a criterion for freelancers who want to bid for their job to have earned software development certification from Upwork.

4. Flexible payment method

Upwork pays your earnings through different payment methods – PayPal, Payoneer Direct Bank, M-Pesa, Wire Transfer, Deposit, etc. If you live in a country where PayPal is not supported, you can still become a freelancer on Upwork and withdraw your earnings using Payoneer or Direct Bank Deposit. Upwork allows you to choose when you want to withdraw your earnings which can be monthly, once in three months, or twice a month. 

FAQs on Upwork service fees

Before I conclude, let’s look at some key questions you ask that relate to service fees on Upwork as a freelancer or client.

How do I avoid Upwork fees?

The only way to avoid Upwork service fees is not to bid for a project and get hired and paid by clients. I am not sure this is what you wish yourself as a freelancer on Upwork. In a sense, there is no way you can avoid Upwork service fees provided you get hired and paid on their platform. 

How much does Upwork charge per hour?

Upwork doesn’t charge service fees per hour. It is per project or job. Anytime you deliver a job and get paid, a certain percentage is taken from it. 

How does Upwork make money?

Upwork makes money from the service fees it charges freelancers on its platform, and the administrative and processing it charges fees clients anytime they pay for a project done by freelancers. It also makes money when the value of its market share goes up. 

Final thought on Upwork service fees 

Upwork service fees are lower compared to Fiverr. While Fiverr take 20% of every sale you make, Upwork takes 20%, 10%, and 5% depending on the amount you earn. So it’s up to you to decide if the service fees are reasonable for you. Don’t forget that there are benefits you derive from being a freelancer on Upwork that outweigh the service fees it deducts from every sale you make.