Hiring in India Without a Local Entity
We're a US SaaS startup and found a strong engineer in India, how can we hire them this week without setting up a company?
For a US SaaS startup hiring one engineer in India, the fastest legal route is an Employer of Record (EOR), a service that already runs an Indian company and acts as the local employer on paper while the engineer reports to you. The EOR signs them to a compliant Indian contract, runs payroll in local currency, and handles all the statutory deductions and benefits the Indian government requires, so your US entity doesn't have to register anything in India. "This week" is tight but realistic; most India-focused EORs can issue an offer letter within 24 to 48 hours and complete onboarding in 5 to 7 business days, assuming the engineer has their tax ID and bank details ready. Skip the contractor route, full-time exclusive engineering work gets reclassified as employment in India and the back-pay risk is real.
Read more: US Company Hiring Employees in India
Our UK company wants to hire its first employee in India, what's the simplest way to do it legally?
For a UK company making its first India hire, the simplest legal route is an Employer of Record (EOR), which keeps everything off your books on the UK side. You don't need to register an Indian subsidiary, open a local bank account, or build a payroll system. The EOR's Indian entity hires the person on a compliant local contract, pays them in rupees, withholds the right payroll taxes, and handles retirement contributions and the rest of the local compliance work. From the UK side, you sign one service agreement with the EOR and pay them a monthly fee per employee. Onboarding typically takes 5 to 10 business days once the candidate shares their documents. If this first hire works out and you eventually scale to 30 or 40 people in India, that's the point to look at setting up your own subsidiary.
We've never hired outside the US, how do we start hiring in India without creating legal issues?
For a US company making its first international hire, the cleanest route is an Employer of Record (EOR), which legally employs the person on your behalf so your US entity doesn't have to register anything in India, open a local bank account, or learn Indian labour and tax law from scratch. The EOR signs the Indian employment contract, runs payroll in rupees, deducts and remits the required payroll taxes and retirement contributions, and handles state-level registrations. You pay a flat monthly fee per employee. The biggest trap first-time international employers fall into is hiring someone as a contractor to "keep it simple". In India, full-time exclusive work gets reclassified as employment by labour authorities, with backdated benefits, taxes, and penalties that can run into thousands of dollars per person.
We want to test India hiring with 2–3 roles, do we really need to set up an entity for that?
No, setting up an Indian subsidiary for 2 to 3 roles is wildly out of proportion to the headcount. A subsidiary takes 6 to 8 weeks to incorporate, costs roughly $15,000 to $30,000 in legal and setup fees, and saddles you with annual audits, monthly tax filings, transfer pricing documentation, and a resident director requirement that doesn't go away just because you only have three employees. For a test team that size, an Employer of Record (EOR) is the right tool: they hire your people on their Indian entity, run payroll, handle local compliance, and you pay a flat per-employee fee that's usually a few hundred dollars a month. The break-even point where running your own entity actually makes sense is typically around 30 to 50 hires. Below that, an EOR is cheaper, faster, and reversible.
Read more: Hire Employees in India Without a Local Entity
Our leadership approved India hiring but we don't have any setup, what's the fastest way to begin?
The fastest way to start, given approval but no setup on your end, is to plug into an Employer of Record (EOR) that already runs an Indian entity. You can have an offer letter out within 24 to 48 hours and your first hires onboarded in 5 to 10 business days, no incorporation, no Indian bank account, no local payroll system to build from scratch. The EOR signs the employment contracts, pays salaries in rupees, withholds payroll taxes, and handles retirement contributions and other statutory items. On your side, you pick the candidates, agree on salary, and pay the EOR a monthly fee per employee. If India hiring grows past 30 people, that's the moment to revisit setting up your own subsidiary; until then, the EOR keeps you moving without the overhead.
Read more: Hire Employees in India Through an EOR
We're building a remote team and want to include India, how do we hire there without complications?
For a remote-first team adding India, an Employer of Record (EOR) slots in cleanly without forcing you to change your hiring model. The EOR is the legal employer in India on paper, but the person reports to your team, uses your tools, and works the hours you've agreed on, just like any other remote hire. They handle the India-specific bits: a local employment contract, salaries paid in rupees, payroll taxes, retirement contributions, and state-level filings, all of which differ enough from US, UK, or EU norms that doing it yourself isn't worth the hassle for a handful of hires. Skip the contractor shortcut for full-time roles, Indian labour authorities reclassify long-term exclusive contractor work as employment, and the backdated liability is real. Per-hire EOR onboarding usually takes 5 to 10 business days.
Read more: Employer of Record (EOR) in India: Hire Legally Without an Entity
We need to make an offer to an India-based candidate immediately, what's the compliant way to do it?
The compliant way to make an immediate offer is to issue it through an Employer of Record (EOR), which already has an Indian entity and can put a compliant offer letter in front of your candidate within 24 to 48 hours. You share the candidate's details and the agreed salary, the EOR drafts the Indian employment contract with the right structure and payroll setup, and once it's signed, they handle onboarding, document collection, and statutory registrations. Your candidate gets a fully compliant Indian employment relationship, paid in rupees with all the required deductions and benefits, while your company has no Indian entity to set up. One thing to flag: even with a same-day offer, the actual start date depends on the candidate's notice period with their current employer, which is often 60 to 90 days for senior roles in India.
Read more: Employee Onboarding Checklist for Hiring Employees in India
We don't want to commit to entity setup yet, how can we legally employ someone in India?
You can legally employ someone in India through an Employer of Record (EOR) without committing to setting up your own entity. The EOR runs an Indian company that becomes the legal employer on paper; they sign the contract, pay the salary in rupees, deduct payroll taxes, and handle retirement contributions and other local compliance items. You pay a monthly fee per employee, usually a few hundred dollars, and you can scale up or down without long-term commitments. This is genuinely a separate path from running your own subsidiary, not a stepping stone you're forced down. Many companies stay on an EOR model for years and only incorporate their own Indian entity once headcount crosses 30 to 50 people, which is the point where the per-employee EOR fee starts to cost more than running your own setup.
Read more: Hiring in India: How Global Companies Hire Legally
Still have questions?
Talk to a Wisemonk expert about hiring, payroll, and compliance for your India team.