Overview

Capital
New Delhi
Currency
Indian Rupee

Taxes

Employer
Up to 12% - Pension fund
4.75% - Health insurance
Employee
0% - 0 Rs - 2,50,000 Rs
10% - 2,50,001 Rs - 5,00,000 Rs
20% - 5,00,001 Rs - 10,00,000 Rs
30% - Above 10,00,000 Rs
Up to 12% - Provident fund
1.75% - Health insurane

Minimum Wage

General

Minimum wages in India differ according to the governing state and workers skill set.

Non Mandatory

Expat Benefits

Depending on the company, the expat benefits include matching the salary of their home country,adjusting the cost of living and other personal allowances. Assistance with children’s education fees is also a common benefit for expats.

VAT

General

VAT is 5% standard rate.

Mandatory Benefits

Pension Fund

Pension is comprised of a pension scheme and a provident fund.

Contributions are made by the employee, employer and government.

  • Employee - (Provident Fund) 12% of basic wages
  • Employer – 8.33% of monthly payroll. (Provident Fund) 3.67% of monthly payroll and .5% of monthly payroll for administrative cost. 8.33% of monthly payroll is contributed for employees 58 or older.
  • Government – 1.16%of basic wages.
Social Security

India’s social security is comprised of the Employees Provident Fund (mandatory if the company has over 20 employees), the Miscellaneous Provisions Act, Employees State Insurance and a pension scheme. It covers pension, health, injury and unemployment.

Health Insurance

Healthcare is made of contributions by the employee, employer and government.

  • Employee – 1.75% of wage
  • Employer – 4.75% of payroll

Government – 12.5% of medical bill costs

Payroll

Payroll Frequency

Employees are paid monthly.

Pay Date

Employees must be paid by the last day of the month, however, it is customary to pay employees from the 28th of the month onward. 

Working Hours

A full-time work week is 48 hours.    

Overtime Payment

Overtime is paid double the rate of the normal pay. 

Termination

Termination Process

If termination isn’t specified in a contract, an employer must give 30 days’ notice or payment in lieu to an employee who has worked for at least 3 months. No notice is required for termination due to misconduct.

Advance Notice

A 30 days’ notice period should be given.

Severance Pay

Severance payment is given to workers who have been continuously employed for 2 years and are terminated for redundancy. Severance payment reflects duration of employment, performance and salary.