Is it better to contract or be employed in India?

At $100/hour against a salaried equivalent of $70/hour, 40 hours a week, contracting nets more than employment in India: a contractor keeps about $149,160 against an employee's $116,480, a difference of $32,680. The break-even rate — where the two are equal — is about $78/hour. Presumptive taxation (44ADA) can lower effective rate.

What hourly rate do I need to charge in India?

To take home $100,000 a year after tax, health cover and unpaid time, you need roughly $90/hour, or a day rate around $717. That assumes $128,974 of gross revenue across 1440 billable hours.

Why is the contractor tax rate in India different from the employee rate?

A contractor usually pays both halves of social contributions where an employer would otherwise pay one, and often buys health cover privately. Here that works out at about 22% effective for a contractor against 20% for an employee. Presumptive taxation (44ADA) can lower effective rate.

How accurate are these India figures?

These are single blended effective rates, not a bracket-by-bracket calculation, and India is outside the OECD series this site cross-checks against. Real liability depends on your regime, deductions and region. Estimates for comparison, not tax advice.

Contracting · India

Contractor or employee in 🇮🇳 India?

At $100/hour, contracting nets more than employment — the break-even rate is about $78/hour.

Side by side at $100/hour

	Contractor	Employee
Gross	$192,000	$145,600
Tax	$42,240	$29,120
Health insurance	$600	—
Net	$149,160	$116,480
Effective rate	22%	20%

Presumptive taxation (44ADA) can lower effective rate. Run your own rate in the interactive calculator.

To take home $100,000 a year

You need to charge about $90/hour (day rate $717), billing 1440 hours across the year for $128,974 of gross revenue.

Change the target in the required-rate calculator.

Countries with a similar contracting premium

🇵🇭 Philippines — +12% for contracting
🇬🇧 United Kingdom — +13% for contracting
🇳🇬 Nigeria — +13% for contracting
🇸🇬 Singapore — +13% for contracting

Questions

Is it better to contract or be employed in India?: At $100/hour against a salaried equivalent of $70/hour, 40 hours a week, contracting nets more than employment in India: a contractor keeps about $149,160 against an employee's $116,480, a difference of $32,680. The break-even rate — where the two are equal — is about $78/hour. Presumptive taxation (44ADA) can lower effective rate.
What hourly rate do I need to charge in India?: To take home $100,000 a year after tax, health cover and unpaid time, you need roughly $90/hour, or a day rate around $717. That assumes $128,974 of gross revenue across 1440 billable hours.
Why is the contractor tax rate in India different from the employee rate?: A contractor usually pays both halves of social contributions where an employer would otherwise pay one, and often buys health cover privately. Here that works out at about 22% effective for a contractor against 20% for an employee. Presumptive taxation (44ADA) can lower effective rate.
How accurate are these India figures?: These are single blended effective rates, not a bracket-by-bracket calculation, and India is outside the OECD series this site cross-checks against. Real liability depends on your regime, deductions and region. Estimates for comparison, not tax advice.

Estimates for comparison, not tax advice. Effective rates are blended, not bracket-by-bracket except where noted, and every country has regimes and deductions a single rate cannot express.