<\/span><\/h3>\n\n\n\n1. What is the secondment of employees to an Indian subsidiary?<\/strong>
It is a temporary assignment where an employee of a foreign group company works for its Indian subsidiary. The employee may keep a link with the home employer, but Indian tax law looks at who controls the work and bears the cost, which usually points to the Indian entity as economic employer.<\/p>\n\n\n\n2. Is salary of a seconded employee taxable in India?<\/strong>
Yes. Salary for services rendered in India is taxable in India regardless of where it is paid. The Indian entity must deduct TDS. A DTAA may give relief for stays under 183 days, but that relief is usually unavailable when the Indian subsidiary bears the cost.<\/p>\n\n\n\n3. Does secondment create a permanent establishment in India?<\/strong>
It can. Following Morgan Stanley<\/em> (Supreme Court, 2007), a service PE may arise if the foreign parent retains control and a lien over deputed staff and continues paying them. Making the Indian subsidiary the true employer, with clear documentation, reduces this risk.<\/p>\n\n\n\n4. Is RBI approval needed to reimburse the foreign parent for secondee costs?<\/strong>
Generally not. Reimbursement is a current account transaction under FEMA and is routed through an authorised dealer bank with tax certification (Forms 15CA\/15CB). Approval or reporting issues arise only if costs are converted into equity or fall outside current account rules.<\/p>\n\n\n\n5. Which visa does a foreign secondee need for India?<\/strong>
A foreign employee generally needs an employment visa, subject to a minimum salary threshold of USD 25,000 a year. Stays above 180 days require FRRO registration within 14 days of arrival. A business visa is not suitable for productive employment in the Indian subsidiary.<\/p>\n","protected":false},"excerpt":{"rendered":"Secondment of employees to Indian subsidiary structures help multinational groups move leadership, technical expertise and project teams to India quickly. They also create layered obligations under income tax, foreign exchange, indirect tax, immigration and labour law. A single oversight, such as an unreported cost recharge, can trigger withholding tax demands, a permanent establishment claim or […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[812],"tags":[745,801,4663,4667,972,4658,4665,4659,974,4662,4669,4660,4668,4664,4657,4656,4655,4666,4661],"class_list":["post-9724","post","type-post","status-publish","format-standard","hentry","category-blog","tag-company-formation-in-india","tag-company-setup-in-india","tag-cross-border-employment-india","tag-dtaa-salary-india","tag-employment-visa-india","tag-expatriate-taxation-india","tag-foreign-company-india-setup","tag-foreign-employee-deputation-india","tag-frro-registration","tag-indian-subsidiary-compliance-2026","tag-mnc-expatriate-india","tag-permanent-establishment-india-secondment","tag-reverse-charge-gst-secondment","tag-rnor-status","tag-secondment-fema-compliance","tag-secondment-of-employees-to-indian-subsidiary","tag-secondment-tax-india","tag-social-security-agreement-india","tag-transfer-pricing-secondment"],"_links":{"self":[{"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/posts\/9724","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/comments?post=9724"}],"version-history":[{"count":1,"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/posts\/9724\/revisions"}],"predecessor-version":[{"id":9726,"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/posts\/9724\/revisions\/9726"}],"wp:attachment":[{"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/media?parent=9724"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/categories?post=9724"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/startupsolicitors.com\/blog\/wp-json\/wp\/v2\/tags?post=9724"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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