With over 1.2 billion people, a rapidly expanding middle class, and a highly skilled labor force, India is a huge opportunity for global expansion. India is a complex market with multiple legal and administrative systems, a government structure with central and state budgets, and rich regional diversity.
One of the major challenges to expanding and managing payroll in India is the frequent change to both central and state regulations and business procedures. Each region has it’s own unique challenges and languages, so payroll can be complex to navigate.
Employment Considerations in India:
- The fiscal year runs from April 1 through March 31 each year
- There is no standard minimum wage in India, but the federal government recommends a minimum wage of Rs. 176 per day
- Work hours are limited to 48-50 hours per week
- Termination of employees requires 30 days notice
- Work visas are needed for foreigners, typically valid for the duration of the work contract, 1 year or a maximum of 5 years
- Individual income tax rates are based on income level and age
Tax and Surcharges:
- The corporate tax rate in India is 30%, but foreign businesses are taxed at 40%
- Health and Education charge is collected at 4% of the income tax
- Surcharges on 10-15% of income tax payments are applied if income is over Rs. 5 million
Our cloud-based payroll technology with customized monthly reporting allows you to view your payroll in real-time. With a US-based service team and direct access to our in-country experts you can easily get answers to your payroll and compliance questions. Let us help you simplify payroll in India – click here to get started