Salary from Foreign Comapny

[Pradeep Kaushik]

Respected Sir,

 

Our process to establish Manufacturing Division in India,is under process.

For this purpose we have selected one Indian Person for Planning & Development in India.

His Salary will be paid by Main Company in Korea. i.e. Salary will be remitted from Korea in Employee's Bank Account.

 

Please sugesst us:

 

1. Any Transfer Pricing Issue regrarding these transactions.

2. Any Tax Obligation (Direct- Indirect)

 

Best Regards.

Pradeep kaushik

 

AI Summary

Tax withholding obligations for cross border payroll require TDS compliance and transfer pricing care for reimbursements.
A foreign parent's payment of salary to an Indian national engaged to establish manufacturing operations in India raises Indian tax withholding obligations. If a local branch or subsidiary pays, that Indian entity must withhold and remit tax. If the foreign company pays directly, the foreign payer must ensure TDS compliance for salary for services in India. Payment by an Indian subsidiary and reimbursement by the foreign parent is possible but requires arm's length transfer pricing documentation and careful structuring.