There has been a significant rise in cross-border employments in the recent times. While this has several advantages and benefits, there is also an additional cost due to regulatory policies across the globe such as tax and social security. India did not have any specific social security regime for globally mobile employees, unlike many other countries. However, in November 2008 the Indian Government amended the social security regulations to bring foreign nationals working for a covered establishment in India (International Workers / IWs) within its ambit. The regulations also laid down specific provisions for deputees to overseas locations in certain circumstances. Further, the norms for withdrawal as applicable to IW have been tightened considerably. The social security Regulatory authorities have also issued periodic updates in the form of frequently asked questions to clarify open issues.
Social Security Agreements
Social Security Agreements (SSAs) provide a way out of the dual social security liabilities for mobile employees. Benefits of SSAs are Detachment, Export of benefits and Totalization. India has entered into SSAs with eleven countries out of which eight SSAs are in force as of date. The status of SSAs is summarized below:
Belgium, Germany (limited), Switzerland, Denmark, Luxembourg, France, Korea, Netherlands, Hungary, Sweden, Finland, Czech Republic
Concluded and signed
Japan, Canada, Portugal, Norway, Austria, Quebec, Germany (Comprehensive)
How can Deloitte assist you?
Deloitte can provide integrated services that help you navigate the complex social security laws and related compliance obligations of your compensation programs in a cost efficient manner.