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Understand the full cost of hiring through an Employer of Record in India. Compare published fees, employer contributions, benefits, GST, currency charges and deposits. Worked examples separate recurring budgets, first-year spending and launch cash, with helpful checks for comparing provider quotes.
Employer of Record cost in India includes the employee’s gross salary, employer contributions, benefits and the EOR service fee, plus any tax, currency conversion and additional services. Published service fees in the sample reviewed range from US$99 to US$699 per employee per month, with some conditional offers below that range. The fee alone is not your hiring budget.
For example, an employee earning ₹1,00,000 gross per month costs ₹1,22,135 in the model below, including a ₹15,000 EOR fee and a gratuity provision. That is before GST where chargeable, foreign exchange costs, equipment, recruitment and other stated exclusions. A refundable deposit can increase the cash needed at launch without increasing the underlying service price.
For employers in the USA, UK, Australia, New Zealand and India, the useful comparison is therefore three separate numbers: recurring employment budget, first-year budget and upfront cash requirement. This guide shows how to calculate each, compare actual pricing models and question a quote before signing.
Public prices span a wide range because providers sell different service packages and apply different conditions. Compare an India-specific written quote against the published starting price, then add employment costs separately.
The following are first-party prices visible during this review. They are advertised fees, not independently audited invoice totals or a statistically representative market average.
| Provider and Source | Published Service Price | What Needs Checking |
|---|---|---|
| Wisemonk pricing | From US$99 per employee/month | Applicable tier and separately funded benefits, equipment and recruitment. |
| Deel pricing | US$599 per EOR employee/month | India quote, package scope and commercial terms. |
| Remote pricing | US$699 per employee/month (USD view) | Billing terms, benefits and any negotiated discount. |
| TMS India pricing | From US$50 per employee/month | Volume conditions and the stated US$3,000 monthly gross salary limit for standard fees. |
| Black Piano India pricing | £550 per employee/month plus Total Cost of Engagement | Recruitment and HR scope, and exactly what sits inside the additional engagement cost. |
They may include different work, support levels and financial terms. A higher fee can include recruitment, local HR support or broader administration, while a lower fee can still be suitable for a straightforward hire you have already sourced.
Compare the named legal employer, direct delivery versus partner delivery, employee support, payroll correction process, insurance administration and exit handling. An entity ownership claim alone does not establish service quality. Ask which company signs the employment contract and which company holds your deposit.
Also distinguish a published starting price from the price available to your team. Headcount minimums, salary bands, annual commitments and special employment arrangements can change the offer. Use Peorient’s comparison of EOR providers in India to evaluate scope alongside cost.
A fixed fee becomes cheaper when the percentage charge exceeds that fee, assuming the services and other charges match. The salary at which they break even equals the fixed fee divided by the percentage rate.
For a hypothetical ₹15,000 monthly fee versus 10% of gross salary, the break-even salary is ₹1,50,000 per month. Below it, 10% costs less. Above it, the fixed fee costs less.
| Monthly Gross Salary | Fixed Fee | Fee at 10% of Gross | Lower Service Fee |
|---|---|---|---|
| ₹50,000 | ₹15,000 | ₹5,000 | Percentage model by ₹10,000 |
| ₹1,00,000 | ₹15,000 | ₹10,000 | Percentage model by ₹5,000 |
| ₹1,50,000 | ₹15,000 | ₹15,000 | Equal |
| ₹2,00,000 | ₹15,000 | ₹20,000 | Fixed model by ₹5,000 |
Confirm whether the percentage applies to gross salary, CTC, bonuses, reimbursements or the entire payroll invoice. A 10% fee on gross and a 10% fee on total employment cost are different offers. Ask whether a pay rise changes a flat fee through salary-tier rules.
Start with gross salary, add employer-funded obligations and benefits, then add the provider’s charges and applicable transaction costs. Keep refundable security and employee deductions in separate categories.
Your recurring budget is gross salary plus employer statutory costs, benefits and provisions, the EOR fee, optional recurring services, FX and bank charges, and tax that ultimately remains a cost to you. An invoice can differ from this budget because some provisions are funded later and some taxes may be recoverable.
Gross salary is pay before employee deductions. CTC is a package description whose contents must be specified. Take-home pay is what reaches the employee, while the EOR invoice funds employment and the provider’s service.
| Term | What It Represents | Comparison Mistake to Avoid |
|---|---|---|
| Gross salary | Salary before employee PF, income-tax withholding and other deductions. | Adding those deductions again as employer costs. |
| CTC | Agreed package that may include employer PF, gratuity provision, insurance and variable pay. | Adding components already included in the quoted CTC. |
| Take-home pay | Net salary after employee deductions. | Treating a promised net amount as a gross salary. |
| EOR invoice | Funded payroll, employer obligations, service charges and other billed amounts. | Assuming the management fee includes salary. |
| Refundable deposit | Security held under the commercial agreement. | Treating the full deposit as an annual expense. |
Ask the candidate and provider to sign off on the same salary worksheet. If an offer promises a net salary, obtain a gross-up calculation before agreeing the budget. Employee tax choices and deductions can change the gross amount required to deliver that promise.
For a wider view of hardware, workspace and management overhead, use Peorient’s fully loaded employee cost breakdown.
Request a line for each cost, with its calculation base, rate, payment timing and refund treatment. A single “statutory charges” percentage hides the assumptions you need to check.
Ask for these items in the same worksheet:
This format also makes annual renewals easier to audit. You can identify whether an increase comes from salary, benefits, law, the exchange rate or the provider’s margin.
PF, ESI where applicable, gratuity and eligible statutory bonus are the main national components to examine. State-specific obligations and the employment arrangement determine additional amounts.
The government made the four Labour Codes effective from 21 November 2025. A usable October 2026 quote must account for subsequent notifications and the applicable state position, rather than reproducing a pre-code payroll template.
For an ordinary covered employee at the standard 12% rate, a contribution capped at ₹25,000 of PF wages is ₹3,000 per month. A higher-wage contribution arrangement can produce a larger amount.
The official EPFO wage-ceiling announcement confirms the increase from ₹15,000 to ₹25,000, effective 17 September 2026. Subject to the scheme rules, employees previously contributing at the old ceiling move to the lower of actual applicable wages and the revised ceiling.
The standard 12% contribution and separate 0.5% EDLI and 0.5% administration charges are summarised in ICMR’s February 2026 memorandum on EPFO contribution rates. Its older ₹15,000 ceiling predates the September change. Use the rates alongside the newer ceiling announcement.
In the capped model used here, employer PF is ₹3,000, EDLI is ₹125 and the allocated administration charge is ₹125 per month. The administration minimum applies at establishment level, so it should not automatically be charged in full to every employee. Higher-wage contributions, exemptions and international-worker cases require separate treatment.
Moving the capped employer PF contribution from ₹1,800 to ₹3,000 adds ₹1,200 per month, or ₹14,400 over a full twelve-month period, before related charge changes. This calculation explains why an old quote can understate costs even when the EOR’s own fee stays unchanged.
KPMG’s review of EPFO’s revised-ceiling FAQs also explains the September split-period calculation and treatment of higher-wage contributions. October is a full month under the revised ceiling. Do not apply October’s full-month calculation retrospectively to all of September.
No. The rule concerns the statutory definition of wages and the add-back of specified exclusions. “Set basic at 50% of gross” can miss components included in the remuneration test.
The Ministry’s March 2026 Labour Code FAQs explain how employer PF and pension contributions, statutory bonus and overtime interact with the calculation. They distinguish these from gratuity, ESI and other retirement benefits.
Ask the EOR for the calculation, not a verbal assurance that the salary structure follows a 50% rule. The statutory wage figure affects contribution and benefit calculations, while PF contribution ceilings remain a separate question.
Our examples use an assumed statutory wage base of 60% of gross, with no DA, retaining allowance or variable pay. This is a modelling choice, not a prescribed salary structure. The provider must validate the actual remuneration components for your hire.
ESI adds an employer contribution of 3.25% of ESI wages for covered employees. The usual coverage ceiling is ₹21,000 per month, with a ₹25,000 ceiling for persons with disabilities, as set out in ESIC’s citizen charter.
The employee contribution is 0.75%, subject to the applicable exemption rules. It is normally withheld from wages rather than added as a second employer charge. For an illustrative covered employee with ₹20,000 of monthly ESI wages, the employer pays ₹650 and the employee share is ₹150.
Do not assume a mid-period pay rise immediately ends coverage. Check the contribution-period rules and the relevant wage definition. Our main examples assume new hires above the ESI ceiling with no continuing coverage obligation. Private medical insurance is budgeted separately.
Peorient’s EPF and ESIC employer contribution guide provides more context for comparing the two schemes.
Gratuity is an employment benefit payable when the legal conditions are met. A monthly gratuity line on your EOR invoice may instead be advance funding or a provision under your commercial agreement.
Section 53 of the Code on Social Security provides the monthly-rated calculation based on 15 days of last-drawn wages for each qualifying year, using a divisor of 26. A simple monthly budgeting provision therefore uses 15 divided by 26 divided by 12, approximately 4.81% of the relevant monthly wages.
At ₹60,000 of relevant wages, that provision is approximately ₹2,885 per month. It is not 4.81% of the entire EOR invoice. Nor is it an actuarial valuation: future wage increases, service periods and eligibility can change the ultimate liability.
Regular employment generally has a five-year qualifying condition, with statutory exceptions. The Ministry’s fixed-term employment clarification states that a fixed-term employee qualifies after one year under the contract. An employee supplied through an EOR is not automatically a fixed-term employee.
Ask who holds the provision, whether it is insured or funded, what happens if no payment becomes due, and how it transfers when you change providers. Review Peorient’s gratuity rules and calculation guide before comparing a quote that accrues monthly with one that bills only on exit.
No. Statutory bonus depends on coverage and eligibility, while employee professional tax is generally a payroll deduction. Neither belongs in a universal percentage uplift for every employee.
Section 26 of the Code on Wages sets the minimum annual bonus at 8⅓% for eligible employees, with a maximum of 20% under the relevant provisions. The threshold and calculation wage must be checked against the applicable notification. A performance bonus is a separate compensation commitment.
The August 2026 bonus-notification analysis by SCC Online reports a ₹21,000 eligibility ceiling and a calculation base of ₹7,000 or the relevant minimum wage, whichever is higher, under the central notifications. Confirm the appropriate-government position for the establishment.
Professional tax and labour welfare fund contributions vary by state. Separate the employee deduction from any employer contribution or enrolment liability. Peorient’s state-by-state professional tax guide helps identify where further checks are needed.
Under the stated assumptions, recurring monthly budgets are ₹70,692, ₹1,22,135 and ₹2,25,019 for gross salaries of ₹50,000, ₹1,00,000 and ₹2,00,000 respectively. These are comparable scenarios, not salary benchmarks or binding quotes.
Each example uses the same ₹15,000 monthly service fee, capped PF policy and ₹1,000 monthly insurance budget. Only gross salary and the associated gratuity provision change.
The employees are assumed to be ordinary resident Indian hires already eligible for PF membership. Statutory wages are assumed at 60% of gross, employer PF is capped at ₹25,000 and gratuity uses the full model wage base. ESI and statutory bonus are assumed inapplicable. No employer labour welfare fund amount is due in the model’s applicable location and category.
The ₹1,000 insurance budget and ₹15,000 fee are analyst-selected inputs. They are not claimed market averages. Figures exclude GST, FX, bank fees, recruitment, equipment, variable pay, overtime, leave encashment, replacement cover and exit costs. Paid leave taken within the year is already part of the twelve monthly salary payments.
| Monthly Component | ₹6 Lakh Annual Gross | ₹12 Lakh Annual Gross | ₹24 Lakh Annual Gross |
|---|---|---|---|
| Gross salary | ₹50,000 | ₹1,00,000 | ₹2,00,000 |
| Model statutory wages, 60% | ₹30,000 | ₹60,000 | ₹1,20,000 |
| Employer PF | ₹3,000 | ₹3,000 | ₹3,000 |
| EDLI | ₹125 | ₹125 | ₹125 |
| Allocated PF administration | ₹125 | ₹125 | ₹125 |
| Gratuity provision, rounded | ₹1,442 | ₹2,885 | ₹5,769 |
| Insurance budget | ₹1,000 | ₹1,000 | ₹1,000 |
| EOR service fee | ₹15,000 | ₹15,000 | ₹15,000 |
| Total recurring budget | ₹70,692 | ₹1,22,135 | ₹2,25,019 |
| Annual budget, 12 months | ₹8,48,304 | ₹14,65,620 | ₹27,00,228 |
| Total uplift over gross | 41.38% | 22.14% | 12.51% |
The declining percentage is meaningful. The fixed fee takes up 30% of the lowest salary but only 7.5% of the highest. This is why a single claim that “EOR adds 15–20%” cannot describe every hiring budget.
The ₹1,00,000 gross-salary example rises from ₹1,22,135 to ₹1,26,510 per month if PF is calculated on the full assumed ₹60,000 wage base. The difference is ₹4,375 per month or ₹52,500 per year.
Employer PF rises from ₹3,000 to ₹7,200. The allocated administration charge rises from ₹125 to ₹300, while EDLI remains ₹125 in this illustration. Gratuity and the other inputs stay the same. This comparison assumes the higher-wage arrangement is valid and applicable.
Two quotes can therefore have identical EOR fees but different totals because they provide different PF funding. Establish which policy matches the employee’s existing membership and contract before treating the lower total as a saving.
Reconcile the package before adding employer costs. In the middle example, gross salary, employer PF, gratuity provision and insurance together equal ₹1,06,885 per month if those four components are included in CTC.
Adding ₹250 of EDLI and administration plus the ₹15,000 service fee then reaches ₹1,22,135. Adding PF, gratuity and insurance again to ₹1,06,885 would double count ₹6,885 per month, or ₹82,620 per year.
Use Peorient’s India employee cost calculator guide to structure the gross-to-employer-cost reconciliation. For market pay research, consult the separate salary guide by job role. A cost example should never be presented as proof that a particular role can be hired at that salary.
Your upfront requirement can be much larger than one month’s employment budget. Add the refundable deposit, advance payroll funding and any setup or equipment payments due before the employee starts.
A deposit ties up cash but does not automatically become a service expense. Its financial effect depends on the amount, refund timing, permitted deductions and the provider’s ability to return it.
Assume the ₹1,00,000 gross-salary hire above requires a deposit equal to two months of gross salary, a ₹10,000 onboarding charge and a ₹75,000 laptop purchase. Assume the first ₹1,22,135 invoice also collects the gratuity provision.
| Launch Payment | Illustrative Cash Required |
|---|---|
| First monthly invoice | ₹1,22,135 |
| Refundable deposit | ₹2,00,000 |
| One-time onboarding | ₹10,000 |
| Laptop purchase | ₹75,000 |
| Cash required at launch | ₹4,07,135 |
The first-year budget, including the model gratuity provision and full laptop purchase outlay, is ₹15,50,620 before the stated exclusions. If the deposit remains held throughout that year, total cash committed becomes ₹17,50,620. Do not add the first month again: it is already inside the twelve-month budget. These are planning totals, not a prescribed accounting treatment.
Agree the calculation base, top-up triggers, permitted set-offs and refund deadline in writing. Also establish whether employee liabilities and provider fees can both be deducted from the same security balance.
A useful clause specifies what documents close the account, when any undisputed balance must be returned and how disputed amounts are handled. Ask whether security is held in INR or the invoicing currency, because the refund can have a different home-currency value later.
For internal decision-making, a ₹2,00,000 deposit held for a year has an illustrative ₹20,000 capital cost at a company-selected 10% hurdle rate. This is a treasury assumption, not another charge from the provider. It helps compare otherwise similar contracts with different security requirements.
The most useful checks cover FX, benefit markups, minimum billing, recruitment, off-cycle payroll and exit handling. A separately disclosed charge is not necessarily unreasonable, but it belongs in the comparison before you commit.
Compare the home-currency amount billed with the amount the same INR obligation would require at a clearly identified reference rate. Include conversion fees and bank charges, not just the advertised spread.
If payroll requires ₹1,00,000, a reference rate of ₹100 per US dollar implies US$1,000. At an applied rate of ₹98 per dollar, you pay US$1,020.41. That is a 2.04% funding premium, even though the quoted rate is 2% below the reference rate.
For a fee-based illustration, 2% added to the model ₹1,22,135 monthly invoice is ₹2,442.70, or ₹29,312.40 per year. Whether the markup applies to salary alone, statutory costs, the service fee or every line materially changes the result.
Ask for the rate source, fixing date, settlement date, spread, conversion path and responsibility for bank deductions. Also check whether credits and deposit refunds use the original rate or a later rate.
Yes. Charges outside the headline fee can reverse the ranking, even when salaries and benefits match.
Take the same model employment budget of ₹1,07,135 before the EOR fee. Hypothetical Provider A charges ₹10,000 plus 2% on that employment amount, producing ₹1,19,277.70. Provider B charges ₹12,000 with no FX surcharge, producing ₹1,19,135. Provider B is ₹142.70 cheaper each month despite its higher headline fee.
If A also charges ₹10,000 onboarding and B charges none, B’s first-year advantage becomes ₹11,712.40. Both examples assume identical taxes, scope and other terms. The lesson is to compare the completed worksheet, not infer quality or value from the cheapest visible number.
Price the actual insurance plan, recruitment scope, equipment and employee support you want. “Benefits administration included” does not necessarily mean the premiums are included.
For insurance, compare sum insured, dependants, parent cover, maternity terms, waiting periods, exclusions and employee co-payments. For equipment, establish ownership, device management, shipping, repairs and recovery on exit. For recruitment, check the fee base, replacement guarantee and whether a replacement creates another onboarding charge.
Paid leave usually continues normal salary, but replacement staff, overtime cover and leave encashment can add costs. Match the contract to the applicable leave policy in India and maternity leave requirements. Do not add a blanket extra month of salary for leave already funded through regular payroll.
Obtain the provider’s written GST position for your specific contract. Neither an overseas billing address nor a line labelled “salary reimbursement” determines the answer by itself.
No. Export treatment depends on the statutory conditions and the actual supply, including the recipient, place of supply and payment arrangements. The IGST Act’s export and zero-rating provisions provide the framework.
Ask which entity supplies the service, who receives it and why the provider’s classification applies. Have the quote state whether GST is charged, the taxable base and the supporting treatment. Keep Indian invoice tax separate from any home-country VAT, GST or other tax analysis your finance team must perform.
No. The taxable value depends on the contract and valuation rules. Recovering an amount at cost or showing it separately does not automatically exclude it from the supplier’s taxable value.
CBIC’s explanation of pure-agent recoveries points to Rule 33 and its conditions. Ask the provider to explain any exclusion of payroll reimbursements rather than assuming that the EOR acts as a pure agent for its own employment obligations.
The size of the issue is easy to test. At an illustrative 18% rate, tax on the ₹15,000 fee would be ₹2,700, while tax on ₹1,22,135 would be ₹21,984.30. This is a sensitivity comparison, not a ruling that either base applies to your arrangement. Recoverable input tax can affect cash flow without being a final cost, subject to eligibility.
Use the same INR employment assumptions across providers, then translate the result into your funding currency. The employee’s Indian work location drives local payroll obligations, while your contracting and funding structure creates additional commercial and tax questions.
The ₹1,22,135 model translates as follows using deliberately chosen planning rates. These are not live exchange rates or forecasts and exclude conversion charges.
| Buyer Location | Planning Rate | Monthly Model Equivalent |
|---|---|---|
| USA | ₹100 per US$1 | US$1,221.35 |
| UK | ₹125 per £1 | £977.08 |
| Australia | ₹65 per A$1 | A$1,879.00 |
| New Zealand | ₹60 per NZ$1 | NZ$2,035.58 |
| India | INR funding | ₹1,22,135.00 |
If the INR strengthens by 5% against your funding currency, the number of rupees bought by one unit falls to 95% of the original rate. An unchanged INR obligation then costs about 5.26% more in your currency. This differs from a separate provider FX markup.
Ask about the funding route, contracting entity, payroll cut-off and local support hours. These are purchasing questions, not assumptions that each country has a different Indian statutory payroll rate.
| Buyer | Questions to Put in the Quote Request |
|---|---|
| USA | Is the fee denominated in USD? What happens when a US bank holiday overlaps the India payroll deadline? |
| UK | Is GBP funding converted directly to INR or through USD? Does recruitment form part of the quoted package? |
| Australia | Can you fund in AUD? Which support hours cover payroll approval and employee escalations? |
| New Zealand | Is NZD billing supported? Do intermediary-bank deductions or an additional currency conversion apply? |
| India | Do you need the provider to be the legal employer, or only payroll administration for employees of your own entity? |
For an Indian company with an existing employing entity, compare EOR with payroll outsourcing on the same scope. They are different services. Peorient’s EOR versus PEO guide for India explains why commercial labels need to be checked against the actual employer relationship.
They show that employment documentation, salary conversion and continuity deserve attention alongside fees. Unclear answers can slow acceptance, create payroll disputes and complicate a later transition.
The Reddit discussions below are examples of questions people are asking, not a representative survey or evidence of provider quality. Some replies contain promotional material, so the useful research signal is the question raised by the original poster.
The contract can define a currency-linked compensation arrangement, but it must make the conversion method and reset dates clear. Otherwise the employer and employee may understand the same offer differently.
A Reddit question about a USD-linked salary paid through an India EOR describes a trailing three-month conversion average and annual resets. That illustrates why “paid in INR” does not tell you who bears currency changes.
Before signing, state the guaranteed gross amount, reference currency if any, conversion window, reset frequency and treatment of bonuses. Also distinguish the employee’s compensation rate from the exchange rate used to fund the provider’s invoice.
The legal employer and the client assignment should be explained consistently in the employee’s documents. Clarify who issues employment verification and exit letters before a candidate asks during onboarding.
One developer’s question about an EOR employment agreement asks why the startup’s name is absent and who provides an experience letter after exit. A separate discussion about EOR employment and background checks raises the mismatch between client-company work and payroll records.
Ask whether the fee includes explaining the arrangement to employees, responding to verification requests and correcting records. These are concrete service deliverables that can make a price difference meaningful.
The transition needs a written plan for service recognition, benefit balances, PF records and funding. Do not assume that changing the payroll employer automatically preserves every entitlement.
A March 2026 discussion about moving from EOR employment to a company’s own entity specifically raises PF and employment-continuity concerns. Turn those questions into contract terms covering gratuity responsibility, leave balances, insurance dates, employee consent and document handover.
Price the transfer before you need it. Potential cash requirements include overlapping payroll funding, a new deposit before the old one is refunded and separately charged migration work.
Separate the provider’s offboarding charge from the employee’s lawful and contractual entitlements. A “no exit fee” offer does not mean the employment can end without settlement costs.
Build a scenario using earned salary, the applicable notice arrangement, leave encashment, earned incentives, gratuity where due and any applicable separation compensation. Add provider processing charges and asset recovery costs separately.
For example, a contractually payable one-month notice buyout calculated on ₹1,00,000 gross creates a ₹1,00,000 cash requirement before other amounts. This is only an illustration. The enforceable notice requirement, wage base and circumstances must be checked. If notice is worked, avoid counting the same month’s ordinary salary twice.
Peorient’s guides to notice period buyout and full and final settlement in India explain the components that should be reviewed together.
No. Review the obligations and indemnities in the service agreement instead of treating “compliance included” as unlimited protection.
Ask who funds and manages an employment claim, what liability caps apply, which client actions are excluded and whether support continues after termination of the service agreement. Employment administration also does not, by itself, answer corporate-tax presence, regulated-activity, intellectual-property or data-protection questions. Those depend on what your team does and how the arrangement is structured.
An entity becomes cheaper on a like-for-like model when the avoided EOR fees exceed the entity’s additional operating and transition costs. There is no universal headcount at which every business should switch.
Compare only the costs that change between the two options. Salary and equivalent employee benefits usually remain on both sides and should not be counted as entity savings.
Use this planning relationship: break-even headcount equals annual fixed entity overhead plus annualised setup and migration costs, divided by annual EOR fee per employee minus annual incremental entity administration per employee. If the denominator is zero or negative, the assumptions do not produce a cost-only crossover.
Assume ₹18 lakh annual fixed entity overhead, ₹6 lakh setup and migration spread over two years, and ₹24,000 annual incremental administration per employee. These are modelling inputs, not published incorporation prices.
| Monthly EOR Fee | Annual Fee per Employee | Illustrative Crossover |
|---|---|---|
| ₹10,000 | ₹1,20,000 | 22 employees |
| ₹15,000 | ₹1,80,000 | 14 employees |
| ₹30,000 | ₹3,60,000 | 7 employees |
The annual fixed numerator is ₹21 lakh. At a ₹15,000 fee, the calculation is ₹21,00,000 divided by ₹1,56,000, or 13.46 employees, rounded up to 14. The same operating plan produces different crossover points when the EOR fee changes.
Headcount uncertainty, setup timing and transition effort can outweigh a small projected saving. Equally, a business may need its own entity for operational reasons before a cost crossover appears.
Use expected employee-months rather than year-end headcount. Ten employees starting on 1 July create 60 employee-months of fees in that calendar year, not 120. Model hiring delays, departures, salary reviews, the period of overlapping operations and the cost of winding down the entity if plans change.
An entity cost estimate should include accounting, statutory filings, payroll, legal support, registered premises and internal management time. A low incorporation filing quote does not measure those recurring obligations.
Send every shortlisted provider the same employee profile and require three totals: recurring budget, first-year budget and cash required before the start date. Then compare the contract and service scope behind those numbers.
Specify the role, work state, start date, gross salary, variable pay, existing PF membership, expected headcount and preferred invoice currency. Add the exact insurance, equipment and recruitment requirements.
Require the provider to identify its legal employing entity, itemise statutory calculations, explain GST, disclose FX and bank charges, price an exit scenario and document deposit refund terms. Request a sample invoice and salary worksheet that reconcile to the same total.
Check evidence of payroll delivery and statutory remittance, employee support ownership, escalation deadlines and the process for correcting an error. Price matters, but the cost comparison is incomplete until you know what the provider must deliver.
Agree the salary basis, contribution policy, funded benefits, commercial fees, tax treatment and exit terms before approving the employment offer. Record every negotiated exception in the agreement or signed pricing schedule.
If your shortlisted quotes use different assumptions, contact Peorient to discuss your India EOR requirements. Bring the completed cost sheets and the employment scope. A useful comparison starts with the same hire, the same benefits and the same payment period.
The best budget is one your finance team can reconcile and your employee can understand: what pays the person, what funds their entitlements, what pays the provider and what remains refundable.
Written by
Director of Global Hiring Advisory · 6+ years experience
Arjun runs the global hiring advisory practice at Peorient. He previously led APAC operations at an EOR startup and advised at Singapore's EDB, overseeing workforce launches in 18 countries across EOR, PEO, and subsidiary models.
