What does a hire in India actually cost you?
Compare EOR, Contractor of Record, your own entity, and the contractor construction under India's presumptive tax regime (44ADA/44AD) — with FY 2026-27 math.
Advanced options
The same hire, priced four ways
Take these numbers with you
Add your email and we'll send the full breakdown. Leave it empty and the button copies a plain-text summary to your clipboard instead.
Want these numbers checked against your actual team?
Send us the shape of your team and we'll come back with the exact rate, the FX terms and a sample document set — no obligation.
Prefer the main company form?
Your inputs travel with the link, so the person who calls you back already has the numbers you were looking at.
Get an exact quote for your teamHow this is calculated
The gross-up is the part people miss. Under any employment construction — an EOR seat or your own Indian entity — you don't pay the take-home, you pay a gross salary out of which income tax and the employee's provident fund are deducted. To leave $1,500 in someone's hand you fund a gross of roughly ₹17.7L a year. The platform fee sits on top of that, not instead of it.
Income tax, new regime FY 2026-27. Slabs run 0 / 5 / 10 / 15 / 20 / 25 / 30% across ₹4L bands from ₹4L to ₹24L. The rebate under section 87A zeroes tax on taxable income up to ₹12L, with marginal relief just above it so crossing the line can never cost more than the amount by which you crossed it. Health and education cess of 4% sits on top of the tax. Salaried income gets a ₹75,000 standard deduction; presumptive contractor income does not.
Employer statutory. Provident fund is matched at the statutory ceiling of ₹1,800 a month on each side. Gratuity accrues at 4.81% of basic, and we model basic at 50% of gross. Insurance is carried at a model ₹1,000 a month. Leave encashment accrues at 40 working days a year, valued at the daily basic rate (monthly basic ÷ 26). That last line alone adds about 6–7% to the employment constructions and is the single item most often left out of EOR quotes.
The presumptive regime — 44ADA and 44AD. A qualifying professional under section 44ADA declares 50% of receipts as deemed income; with the ₹12L rebate that means zero income tax up to roughly $2,200 a month of receipts, and still only about 3% at $2,500. Section 44AD covers business-type services at 6% of digital receipts, which keeps tax at zero across the entire range of this calculator. The 44ADA ceiling is ₹75L of annual receipts for professionals with at least 95% digital receipts. The full derivation is here.
Why the payment route matters as much as the regime. Above ₹20L of annual turnover a contractor must register for GST — but exported services stay zero-rated under a Letter of Undertaking, and zero-rating has to be provable. The proof is that the money arrived from abroad: a FIRA (earlier FIRC) on each payout. Money routed through an Indian paying entity is domestic supply instead, which means 18% GST and 10% TDS withheld at source. Two contractors on identical rates end up with materially different take-home purely because of where the money came from. More on the payment route.
What sits in each column. The EOR column adds a per-seat platform fee to gross plus statutory. The Contractor of Record column pays a contractor rate plus a flat $325 per seat per month (some providers are at $299). Your own entity carries gross plus statutory plus a modelled $800 a month of fixed overhead — registration, compliance, payroll, filings, an accountant on retainer — divided across your seats, which is why it improves with headcount and hurts at one or two. The entity case is worked through here. The ReStaff column is a contractor rate plus a percentage of payout volume, 2.5–5.5% depending on monthly volume.
When an EOR or your own entity is still the right call
The contractor construction is not universally cheaper-and-therefore-better. It is the right answer for contractor-shaped work and the wrong answer for employment-shaped work, and the cost difference does not change that.
Choose employment when you need day-to-day direction over how and when the work happens, when the role carries statutory benefits you actually want the person to have, when provident fund and gratuity accrual matter to them, or when they need a local employment record for a visa or a mortgage. Employment is also the honest answer when the person works your hours, on your equipment, under your line manager, indefinitely — that is an employee, whatever the contract says.
Choose your own entity when India is a long-term bet rather than an experiment: past roughly 15–20 people the fixed overhead amortises, and you gain control that no intermediary gives you. Below that it rarely pays for itself, and it takes weeks to months before the first person is paid — plus a wind-down cost if the bet doesn't work out.
Choose the contractor construction when the work is defined by scope and deliverables, the person controls how they deliver it, and both sides want a clean, documented, low-friction arrangement. That is most engineering, design, QA, content and marketing work bought from India — but it is a test of substance, not of paperwork. If a role fails that test, we will say so rather than sell you the cheaper column.
Questions people ask about these numbers
Why is an EOR seat so much more expensive than the seat fee suggests?
The platform fee is the visible part. Under employment you also fund the gross-up — the employee's income tax and provident fund come out of a gross salary you pay — plus employer EPF at the statutory ceiling, gratuity at 4.81% of basic, insurance and a leave encashment accrual. On a $1,500/mo take-home those additions are worth roughly $1,230/mo before the seat fee is even added, which is why the seat fee is rarely the number that decides anything.
What is 44ADA and why does it change the maths?
Section 44ADA is India's presumptive taxation regime for professionals: a qualifying professional declares 50% of receipts as deemed income and pays tax on that rather than on gross receipts. Combined with the rebate at ₹12L of taxable income under the new regime, income tax comes to zero up to roughly $2,200/mo of receipts. Section 44AD is the business-services equivalent at 6% of digital receipts, which keeps tax at zero across the whole range of this calculator. Both are published simplification regimes in the Income Tax Act with explicit ceilings, not loopholes.
Does the contractor pay GST on top?
Above ₹20L of annual turnover GST registration becomes mandatory, but exported services are zero-rated under a Letter of Undertaking. Zero-rating has to be provable, and the proof is that the money came from abroad — a FIRA (earlier FIRC) per payout. Payments routed through an Indian entity are domestic supply instead: 18% GST plus 10% TDS at source. If an Indian contractor's invoice arrives with 18% GST on it, that is a signal the payment route is domestic rather than foreign.
Is TDS withheld from the contractor's payments?
A foreign payer with no presence in India has no obligation to withhold Indian tax, so nothing is deducted at source and the contractor settles their own liability through advance tax once a year. An Indian paying entity, by contrast, withholds TDS at 10% on professional fees above the threshold — recoverable eventually, but it is the contractor's cash sitting with the tax department in the meantime.
When is an EOR or your own entity still the right call?
When the role is employment-shaped: you need day-to-day control over how and when work is done, statutory benefits, provident fund and gratuity accrual for the person, or a local employment record for visas and mortgages. Roles defined by scope and deliverables belong in the contractor construction; disguised employment does not, whatever it costs. The section above works through the boundary in more detail.
How accurate are these numbers?
They are modelled at ₹89 to the dollar on FY 2026-27 new-regime slabs, with basic set at 50% of gross, mandatory provident fund at the statutory ceiling and leave encashment accrued at 40 working days a year. The intent is the right order of magnitude and honest percentages — enough to make a decision and to know which questions to ask — not a substitute for your accountant. Your actual numbers move with the FX rate, the salary structure your provider uses, and the specific benefits in the package.
Figures modeled at ₹89/$, FY 2026-27 new regime, basic = 50% of gross, mandatory PF at the statutory ceiling, leave encashment accrued at 40 working days per year. Tax calculations assume no other tax planning by the Indian contractor. General information, not tax or legal advice — individual eligibility depends on profession, residency and receipts. Data as of 2026-07-30.