Expatriate Taxation & Advisory

Foreign nationals working in India, and Indians sent on assignment abroad, face two tax systems at once. Salary may be paid in two countries, residency can change mid-year, and social security rules apply alongside income tax. We help employees and their employers get the Indian side right from the first day of the assignment to the last return.

Who this is for

• Foreign nationals employed in India or seconded to an Indian group company
• Indian employees sent abroad on assignment, and those returning
• Employers running inbound or outbound assignment programmes

Residency for expatriates

Indian tax depends on residential status for each financial year, worked out from days in India. A foreign national who spends 182 days or more in India in a year is resident; so is one who spends 60 days in the year and 365 days over the previous four years. Most arriving expatriates are "resident but not ordinarily resident" (RNOR) for their first years, which means foreign income is generally not taxed in India unless it comes from a business controlled or profession set up here. Once ordinarily resident, worldwide income is taxable in India and foreign assets must be reported.

What is taxed

• Salary for work done in India: taxable in India wherever it is paid, including home-country salary and bonuses for the Indian period.
• Allowances and perquisites: rent-free housing, cars, school fees, club memberships and similar benefits are valued under the perquisite rules.
• Tax paid by the employer: where the employer bears the employee's tax, the tax itself is a perquisite, and the salary is grossed up.
• Stock options and shares: taxed when allotted, and again as capital gains on sale, with rules for the period worked in India.
• Short-stay exemption: salary of a foreign national working in India for a foreign employer may be exempt if the stay is under 90 days in the year and other conditions are met; treaties often extend this to 183 days.

Our expatriate tax services

• Pre-assignment planning: residency projections, tax cost estimates and structuring of pay and benefits
• PAN application and registration for the employee
• Payroll set-up and monthly TDS on salary, including split payroll and shadow payroll for home-country pay
• Advance tax for income not covered by TDS
• Annual income tax returns, including foreign tax credit (Form 67) and Schedule FA for foreign assets
• Treaty relief, tie-breaker analysis and tax residency certificates
• Tax equalisation and hypothetical tax calculations for employers
• Social security: Indian PF for international workers and certificates of coverage under social security agreements
• Exit planning: final returns, tax clearance where needed and repatriation of savings
• Permanent establishment review for the foreign employer where employees are seconded

For employers

Seconding staff to India can create a taxable presence for the foreign company and makes the Indian entity responsible for TDS on salary paid abroad. Cross-charges for seconded staff may also attract withholding tax and GST. We review secondment agreements and cost recharges so the employer's position is clear before the employee arrives.

Common questions

I am paid in my home country. Is that salary taxable in India?

Yes, to the extent it relates to work done in India, even if it is paid abroad. Your employer in India usually needs to deduct TDS on it.

Do I need to file a return in India if my employer deducts tax?

Generally yes, if your Indian income is above the exemption limit, and it is the only way to claim refunds, treaty relief or foreign tax credit.

Will I be taxed in India on my overseas investments?

Not while you are non-resident or RNOR, unless the income comes from a business controlled or profession set up in India. Once you become ordinarily resident, worldwide income is taxable and foreign assets must be disclosed.

Do I have to contribute to Indian provident fund?

International workers are generally covered by Indian PF, unless they come from a country with a social security agreement with India and hold a certificate of coverage.

Section and form numbers on this page refer to the Income-tax Act, 1961 and its rules. From 1 April 2026 the Income-tax Act, 2025 applies, with new section and form numbers; the requirements described here are broadly unchanged. We use whichever numbering applies to your transaction date.