- A Singapore startup cannot directly put an Indian worker on payroll without an Indian entity, because Indian law requires a registered employer to handle salaries, statutory contributions, and tax. An Employer of Record (EOR) solves this by becoming the legal employer for you.
- With an EOR, your India hires are full-time employees, not contractors. They get compliant contracts, Provident Fund, gratuity, and benefits, while you direct their daily work and own the relationship and IP.
- Setting up your own Indian subsidiary takes months and ongoing admin. An EOR lets you onboard a full-time India employee in days, with no entity, which is why many Singapore startups start here.
- Employer costs in India add roughly 15 to 25 percent on top of gross salary for statutory items like Provident Fund and gratuity. EOR service fees often run from about $99 to $300 per employee per month on top of that.
- The Singapore to India corridor works well: a close time zone with about a two and a half hour difference, a deep English-speaking talent pool, and strong engineering and operations skills.
A Singapore startup can hire full-time employees in India without opening an Indian entity by using an Employer of Record. The EOR becomes the legal employer in India and handles contracts, payroll, and compliance, while your people work as your own team. This guide explains how it works, what it costs, and how to stay compliant.
Can a Singapore company hire employees in India without an entity?
Yes, but not by putting them on your own payroll directly. Indian law requires a registered employer in India to run payroll, make statutory contributions, and deduct tax. Without an entity, a Singapore company uses an Employer of Record, which acts as that legal employer on your behalf.
The alternative routes are setting up an Indian subsidiary, which takes months and brings ongoing compliance work, or engaging people as contractors, which carries misclassification risk if you treat them like employees. For a startup that wants full-time India employees quickly and compliantly, an EOR is usually the cleanest path to hire employees in India.
How does hiring full-time India employees through an EOR work?
The EOR is the registered employer on paper, so it signs the compliant employment contract, runs monthly payroll, and handles statutory contributions and tax. You choose the person, set their work, manage performance, and treat them as part of your team. The EOR stays in the background handling compliance.
In practice the flow is simple:
- You select the candidate and agree the salary and role.
- The EOR issues a compliant India employment contract and onboards them, usually within days.
- The EOR runs payroll, deducts tax, and pays Provident Fund and other statutory dues each month.
- You manage the person day to day; the EOR handles benefits, compliance, and eventual offboarding.
The result is a full-time employee, not a contractor. That distinction matters for IP, retention, and contractor misclassification risk in India, which we cover below.
What does it cost a Singapore startup to hire in India?
The total cost has three layers: the employee's gross salary, statutory employer contributions of roughly 15 to 25 percent on top, and the EOR service fee, often from about $99 to $300 per employee per month. Our breakdown of the cost of an EOR in India shows each component.
| Cost layer | What it covers | Rough scale |
|---|---|---|
| Gross salary | The employee's agreed pay | Set by role and market |
| Statutory contributions | Provident Fund, gratuity, ESI where applicable | About 15 to 25 percent of salary |
| EOR service fee | Legal employer, payroll, compliance | From about $99 to $300 per month |
The statutory layer is set by Indian law and applies to any compliant employer. The main items are Provident Fund (PF), India's retirement scheme, at 12 percent employer contribution; gratuity, accruing at roughly 4.81 percent of basic salary; and Employee State Insurance (ESI) for lower-wage employees. Even with these, hiring in India often costs far less than equivalent talent in Singapore or other developed markets.
Why hire full-time employees instead of contractors in India?
Full-time employment gives you control, continuity, and clean IP. You can direct daily work, expect availability, and assign intellectual property to your company through the employment contract. Contractors give you less control and, if you treat them like employees, expose you to misclassification claims under Indian law.
Indian courts and authorities judge the real working relationship, not the label on the contract. If a person works set hours, uses your tools, reports to your managers, and works only for you, they look like an employee regardless of what the agreement says. Reclassification can mean back-dated Provident Fund, gratuity, and tax, plus penalties. This is the core of contractor misclassification risk in India, and it is a real reason Singapore startups move core India hires onto full-time employment through an EOR.
What compliance applies, including the new Labour Codes?
India's four Labour Codes became effective on November 21, 2025, consolidating 29 central laws, with central and state rules still being finalized through 2026. The new Labour Code in India changed several things that affect full-time hires.
Two changes matter most for a Singapore startup's India team:
- Basic pay must generally be at least 50 percent of total compensation, which raises the base for Provident Fund and gratuity.
- Fixed-term employees now earn pro-rata gratuity after one year, down from the earlier five-year threshold for permanent staff.
An EOR tracks these central and state changes and structures salaries and contracts to stay compliant, so you do not have to monitor Indian labour law yourself. This information is for general guidance. Consult with legal experts for your specific situation.
Does hiring in India create tax exposure for the Singapore company?
Employing people in India through an EOR reduces, but does not automatically eliminate, the risk of creating a taxable presence, known as permanent establishment. The EOR is the legal employer, which helps, but how your India staff operate still matters. The risk rises if an India-based person habitually negotiates or concludes binding contracts for your company.
A practical guideline is to keep contract-concluding authority outside India and use your India team for engineering, support, operations, and similar functions. The Singapore to India corridor is well suited to this, with a close time zone of about two and a half hours, strong overlap in the working day, and a large English-speaking talent pool. This information is for general guidance. Consult with legal experts for your specific situation.
How does Wisemonk help Singapore startups hire in India?
Wisemonk is an India-native Employer of Record. We help Singapore startups hire full-time employees in India without setting up an entity. We handle the compliant employment contract, IP assignment, Provident Fund and ESI, state obligations, salary structuring under the new Labour Codes, monthly payroll, and tax deductions.
We support 300+ global clients and manage more than 2,000 EOR employees in India, with onboarding usually within days. For a Singapore founder, the benefit is a real full-time team in India that you direct and keep, with clean IP and compliance handled, and none of the cost or delay of building your own Indian subsidiary. We also manage benefits and offboarding throughout the employment.
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Frequently asked questions
Can a Singapore company hire employees in India without a local entity?
Yes. A Singapore company can hire full-time India employees through an Employer of Record, which acts as the legal employer in India. The EOR handles contracts, payroll, statutory contributions, and tax, while you direct the work, so you do not need to set up an Indian entity.
Are EOR hires in India full-time employees or contractors?
They are full-time employees. The EOR puts them on a compliant Indian employment contract with Provident Fund, gratuity, and benefits. You direct their daily work and own the relationship and IP, while the EOR carries the legal employer responsibilities and compliance.
How much does it cost to hire an India employee from Singapore?
Budget for three layers: gross salary, statutory employer contributions of roughly 15 to 25 percent on top, and an EOR service fee often from about $99 to $300 per employee per month. Even combined, India hiring usually costs far less than equivalent talent in Singapore.
How fast can a Singapore startup onboard an India employee through an EOR?
Usually within a few days, once you have selected the candidate and agreed the salary. The EOR already has an India presence, so it can issue a compliant contract and start payroll quickly, far faster than the months needed to incorporate an Indian subsidiary.
What are the main compliance items for India employees?
Provident Fund at 12 percent employer contribution, gratuity at roughly 4.81 percent of basic salary, Employee State Insurance for lower-wage staff, Professional Tax at the state level, and salary structuring under the new Labour Codes effective November 21, 2025. An EOR manages all of these.
Does hiring in India create a permanent establishment risk for a Singapore company?
Using an EOR reduces the risk but does not automatically remove it. Exposure rises if an India-based person habitually concludes binding contracts for you. Keeping contract authority outside India and using the team for engineering, support, and operations lowers the risk.
Why hire full-time India employees instead of contractors?
Full-time employment gives you control, continuity, and clean IP assignment, and it avoids misclassification claims. Indian authorities judge the real working relationship, so treating contractors like employees can trigger back-dated Provident Fund, gratuity, and tax, plus penalties.
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