Foreign Nationals Seeking Indian Employment Visas May Continue to be Paid Outside India
This is an update to the alert we published on August 28, 2022, regarding salary payments for foreign nationals employed in India.
We have procured clarifications from the Indian Consular posts in the U.S. and the U.K, regarding changes to the source of salary for foreign nationals seeking new employment visas. There were certain changes to the requirements published online by the VFS in these two countries, that implied that the salary must be paid in India. It also appeared that the salary must be paid from an Indian source.
We have now confirmed that the salary may be paid outside India and from a non-Indian source. However, it is imperative that the salary is equal to or higher than the minimum threshold of INR 16,25,000 (approx. USD 25,000) annually and that all taxes due on that salary are paid to the Indian Income Tax department. These requirements should be documented in the visa package with appropriate paperwork. Also, it is prudent to ensure that the salary is commensurate to the foreign national’s position since Indian employment visas may only be granted to highly skilled or qualified workers.
Recent employment visa applications filed at different locations in India have been approved even when the foreign national receives his/her salary outside India. Hence, the FRROs/FROs also continue to accept that foreign nationals may be paid abroad as long as the foreign national and employer are compliant with the tax requirements in India. Please note that some FRROs/FROs are very stringent about the level of proof they require to establish tax compliance.