International Employees Procedures

Dear Team,

We have an international employee recently joined, the offers is in USD and currently working remotely.

Kindly advise for the below and further procedures

  1. What is the PF contribution for international employee? will be higher in terms of percentage v/s the other employees.

  2. Can we make the payment to employee in USD instead of the INR? How should be process his payment.

  3. Are there any compliance, which we should be taking care off?

Regards
Venkat

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PF contributions:
For international employees, PF contribution will be on the Full wages(Gross salary) and not on Basic salary.
The percentage remains the same for both Employee and Employer contributions.

Making payment in USD to employees should not be a problem, but from a larger perspective, we have to see the employee residential status and tax implications thereon.

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Before classifying employee as IW, please check whether the employee is already, part of Social Security scheme in his/her home country. See fit for excluded employee status and basically, you have to see the ‘detached worker’ definition

An International worker, being not an Indian employee, contributing to the social security programme of the source country in terms of the bilateral Social Security agreement signed between that country and India and exempt from making any contribution to the Indian system for the period and terms as set out in such an agreement is a ‘detached worker’ for the purpose of compliance under the Indian system. More details about the countries and agreement are available in EPFO portal.

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