Using a VPN is a great way to increase your privacy while you are online.
The websites you visit will not be able to identify you by your IP address, which means that you can appear on the internet as if you were in a different country.
However, you may be wondering if your ISP can see or not that you are using a VPN and if so, does that matter to you?
Can my ISP see if I am using a VPN?
The answer to the first part is simple: Yes, your provider could see that you are using a VPN if he wants to.
This is because of how a VPN works: When you surf the Internet without a VPN, you connect directly from your computer to your ISP system, which in turn connects to the site you want to visit.
When you connect via VPN, your provider connects you first to the VPN server and then to a website. This way each site "sees" that you are using the IP address of the VPN server. Note, however, that without the incognito feature, they could easily locate you.
What does my ISP see?
VPNs differ from proxies in that they encrypt your connection through what is called a secure tunnel. This encrypts the connection from your computer to the VPN server, usually using an advanced encryption method such as AES-256, which, in theory, can only be broken by someone in a few million years.
So the site you are visiting only sees your fake IP address (VPN IP address), but it also works the other way around. When an ISP looks at the connection you made and asks to know where it is headed, all it gets is some random and useless information. It can see that you are making a connection, it can even understand the IP address to which you are connecting but nothing more than that (ie the places you are visiting).
Of course, the return of random data is a warning sign that a VPN is being used. An ISP can easily understand which connections lead to a VPN: simply by looking at those that send a lot of encrypted data back.
Do ISPs check if you are using a VPN?
This leads to the second part of the question, if ISPs care about whether you use a VPN. The answer is probably that it depends on your geographical location.
For the most part, we can assume that ISPs are generally not interested. Whether you are connecting to a VPN server or a website is probably the same for them. After all, many people use VPNs to remotely connect to work networks. The VPN you use to protect your privacy looks about the same.
There is, however, one major exception to this rule:
Dictatorships such as China, Iran and a number of other countries consider VPNs illegal. In these countries, most ISPs will either be state-owned or state-controlled, which means that there is a chance that someone will control the connections.
What about ISPs that sell data?
Of course there are also internet service providers who are not so happy with the customers who use VPN. These are companies based in countries where it is legal to monitor and sell user data, such as in the United States. Although there is no evidence for this, we can imagine that ISPs will not be very happy with VPN users, as this means that there is much less information for sale.
However, since VPN usage is legal in the US and there is no way to enforce a law that defines how users use their Internet connection.