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Working in India on short, medium and long-term assignments
Edition 2011/01
AFSS India, a part of the Access Financial Group, offers payroll solutions to contractors taking up work in India. Access Financial, with its headquarters in Nyon, Switzerland, operates on a global scale and has provided solutions to thousands of contractors in more than 60 countries.
With a team of trained professionals specialised in international contracting issues, AFSS India provides legal and compliant solutions for independent contractors and lets Recruitment Agencies and End Clients concentrate on their core business by taking care of all the work related to the placement of their contractors.
Our goal is to build long-term business relationships based on offering solutions which combine legality with maximum retention rates.
Depending upon the status of the contractor, AFSS India offers the following three solutions: 1 Employed Solution 2 Secondment Solution 3 Self-employed Solution
Access FinancialInternational SA
Solution (Employed)
Employed by AFSS Consultancy Pvt. Ltd.
Payroll
On local payroll
Local Billing
Optional
Work Permit Services
Yes
Work Permit Processing Time
2-3 weeks
Work Permit Application
All foreign nationals need a work permit (Employment Visa) to take up employment.
The application for the Employment Visa must be made at the Indian Embassy or High Commission in the country where the foreign national is ordinarily resident. Work permits can be extended, as required.
Taxes
Progressive tax rates, top rate of 30.9% (including, Education Cess of 3% on Income tax) for income over INR 800,000 per annum.
Tax Year
Starts 1st April.
Official/Popular Languages
English, Hindi.
Social Security
The social security contribution is not mandatory for resident employees earning more than INR 6,500 per month. In the case of expatriate employees the mandatory minimum contribution base to the Employee Provident Fund (EPF) is INR 6,500 per month, irrespective of their total salary.
Both employer and employee are required to contribute in the EPF at the rate of 12% of gross (Basic + D.A.) salary.
Service Tax (in the case of local billing)
10.3%
Typical Retention (one year basis)
67-85%
1 Employed Solution
Eligibility
Indian and other nationals seconded to work in either Belgium or Germany.
Solution (Secondment)
AFSS Consultancy and its associate companies in Germany and Belgium can enable engineers to be posted from India to both countries and remain in the Indian social security system which represents a CTC (Cost to the Company) saving of the social charges in these two countries. We can:
• Sponsor and obtain work permits for Indian nationals.
• Payroll locally in Germany, Belgium and India.
• Offer tax-saving German and Belgian pensions.
• Avoid costly German and Belgian social security for up to 60 months.
• Ensure high retentions.
Payroll
Indian and either German or Belgian payroll.
Local Billing
Optional
Work Permit Services
Yes
Work Permit Processing Time
2-3 weeks
Work Permit Application
All foreign nationals must obtain a work permit to take up employment.
The work permit application for India must be made at the Indian Embassy or High Commission in Germany or Belgium, where the foreigner is ordinarily resident and for German and Belgian work permits the application must be made at the German or Belgian embassy in India. Work permits can be extended, as required.
Taxes
In India there are progressive tax rates, top rate of 30.9% (including, Education cess of 3% on Income tax) for income over INR 800,000 per annum.
Tax Year
Starts 1st April.
Official/Popular Languages
English, Hindi.
Social Security
In India the employee contribution rate to the Employee Provident Fund (EPF) is 12% and the employer has to contribute at the same rate of 12%.
Service Tax (in the case of local billing)
10.3%
Typical Retention (one year basis)
70-85%
Solution (Self-employed)
Self-employment suited to Indian nationals.
A contractor’s foreign personal service company can be registered under the FDI norms of the Ministry of Commerce.
However, for Indian nationals or foreign nationals with their own company, Self-employment can be a viable solution as business expenses can be claimed in order to maximise the salary retention.
Payroll
Not Applicable
Local Billing
Optional
Business Permit Services
Yes
Business Permit Processing Time
2-3 weeks
Business Permit Application
Self-employed foreign nationals coming to India for providing engineering, medical, accounting, legal or such other highly skilled services in their capacity as Independent consultants may be granted a visa to work as a Self-employed.
The application must be made at the Indian Embassy or High Commission in the country where the foreigner
is ordinarily resident. Visas can be extended, as required.
Taxes
Individual income tax rates are progressive, top rate is 30.9% (including, 3% cess on Income tax) for income over INR 800,000 per annum.
Corporate tax rate is 30% for domestic companies and 40% for foreign companies and branches of foreign companies. In addition, a 7.5% surcharge applies to domestic companies (2.5% for foreign companies) if taxable income exceeds INR 10 million. An additional 3% cess is payable in all cases.
Tax Year
Starts 1st April.
Official/Popular Languages
English, Hindi.
Social Security
Self-employed individuals are not required to contribute to any Indian social security schemes but they may have to be registered with Service Tax.
Withholding Taxes (TDS)
10.3% for companies and 5.15% for professionals
Service Tax
10.3%
Typical Retention (one year basis)
75-90%
2 Secondment Solution 3 Self-Employed Solution
Contact usAFSS Consultancy Pvt. Ltd. F-15, Ist Floor, Sector-8, Noida, U.P.-201301, India
Telephone: +91 (0120) 468 1100
Facsimile: +91 (0120) 468 1166
Email: [email protected]
www.accessfinancial.ch
• Federation of India Micro & Small Medium Enterprises • Swiss-India Chamber of Commerce
Our Memberships in India:
Our Memberships outside India:• Geneva Chamber of Commerce • Vaud Chamber of Commerce • Swiss Chamber of Commerce • Swiss British Chamber of Commerce • French Chamber of Commerce • Centre Patronal • APSCo
