Seconding UK Staff to India: The Double Contributions Convention, Payroll and Compliance

For years, UK companies sending staff to India faced an expensive quirk: the same salary could attract both UK National Insurance and Indian provident fund contributions, with little prospect of the employee ever benefiting from the Indian contributions. For short assignments, that double cost often made secondments harder to justify.

That changed on 15 July 2026, when the UK-India Double Contributions Convention came into force alongside the trade deal. This guide explains what the Double Contributions Convention does, the unresolved question over how long the exemption lasts, how certificates of coverage work, what changes on the Indian side, and the tax and compliance issues UK employers still need to manage. UK payroll and tax points should be checked with UK advisers. For the wider market context, see our legal checklist for the UK-India trade deal.

What the Double Contributions Convention does

The Double Contributions Convention (DCC) was signed on 10 February 2026 and was to be implemented alongside the trade deal once both countries completed their domestic processes. It entered into force with the CETA on 15 July 2026. Its purpose is simple: employees temporarily posted from one country to the other stay in their home social security system and don’t pay into the host country’s system as well.

For UK employers, that means a UK employee seconded to India can keep paying UK National Insurance and, with the right certificate, be exempt from Indian provident fund contributions. UK detached workers sent to India can continue building entitlement to a UK State Pension while they keep paying National Insurance. The same principle applies in reverse to Indian workers posted to the UK.

The change is significant. Before the Double Contributions Convention, the UK’s temporary exemption for inbound workers only covered the first 52 weeks, and there was no equivalent relief for UK staff in India.

How long does the exemption last? 36 or 60 months

This is the point UK employers most need to get right, and the sources currently disagree. The UK government published the DCC text on 11 February 2026, describing it as covering employees temporarily working in the other country for up to 36 months. Several advisers say the convention won’t apply at all to assignments intended from the outset to exceed 36 months.

Indian officials, however, describe a longer period. India’s former chief negotiator has said the window was originally 36 months but was extended to 60 months, and Commerce Ministry sources have said India secured an extension from three years to five under the trade deal framework, while acknowledging that the treaty description refers to 36 months.

Until HMRC and India’s Employees’ Provident Fund Organisation publish operational guidance confirming the position, the prudent course for UK employers is to plan secondments around the 36-month period in the published treaty text, treat anything longer as uncertain, and confirm the position with advisers in both countries before a long assignment starts. Check GOV.UK, HMRC and EPFO guidance for updates.

Certificates of coverage and the Indian EPF position

The exemption isn’t automatic. Businesses need to obtain a certificate of coverage confirming that the employee remains in the home country’s social security system. For UK staff going to India, the application is made on the UK side, with HMRC. Apply before the secondment starts, and give a copy to the Indian employer or host entity.

The Indian side matters because of India’s rules on “international workers”. Under India’s Employees’ Provident Fund scheme, foreign nationals working for covered Indian establishments are generally required to contribute to the EPF, often on their full salary, unless they come from a country with which India has a social security agreement and hold a certificate of coverage. The Double Contributions Convention brings UK secondees within that exception, which can save employers and employees a considerable amount. (These EPF points are summarised generally; confirm them with an Indian payroll adviser.)

Think about existing secondees too. Employees who were already working in India when the Double Contributions Convention came into force may be able to benefit for the remaining period of their assignment, depending on how the transitional rules are applied, so review current assignments rather than assuming the convention only helps new ones. Keep records carefully. The Indian host entity should keep the certificate of coverage on file, and payroll teams in both countries should know the start and end dates. If an assignment is extended beyond the exemption period, or the employee switches to a local Indian contract, Indian EPF obligations can start immediately.

Tax, permanent establishment and labour law still apply

The Double Contributions Convention deals only with social security. It doesn’t change income tax. A UK employee working in India may become taxable in India on income from Indian work, depending on the length of stay and the India-UK double taxation agreement, and may become an Indian tax resident if they spend enough days in India. Plan tax equalisation, withholding and return filing in both countries.

Secondments can also create corporate tax risk. If UK staff work in India for long periods, supervise projects or conclude contracts there, the UK company could be treated as having a permanent establishment in India, making some of its profits taxable there. Structuring the secondment properly, typically with the Indian entity as the economic employer and a written secondment agreement, reduces that risk; see our guide to setting up a company in India from the UK.

For many UK employers, the savings are significant enough to change secondment planning: an assignment that previously carried two sets of social security contributions may now be considerably cheaper, which can tip the balance in favour of sending experienced UK staff to set up or support Indian operations. Employment and immigration rules apply too. Secondees need the right Indian visa, usually an employment visa, and Indian host entities must follow India’s labour codes, in force since 21 November 2025, for anyone they employ locally; see our guide to the new labour codes for startups. A clear secondment agreement should set out who employs the secondee, who pays, how costs are recharged, and which law governs.

A secondment checklist, remedies and quick answers

Before seconding UK staff to India, confirm the expected length of the assignment against the 36-month treaty period, apply to HMRC for a certificate of coverage, share it with the Indian host, review income tax and permanent establishment exposure, obtain the right visa, and put a secondment agreement in place. If you instead hire developers locally, see our guide to hiring developers in India from the UK.

If Indian EPF contributions were deducted before the certificate was in place, or in error, the Indian host can seek correction or refunds through the EPFO’s processes, and contributions made by international workers may in some cases be withdrawn at the end of an assignment. Disputes over EPF liability can be raised with the EPF authorities and appealed. For UK employers, the Double Contributions Convention is a real saving, but only if the paperwork is in place on day one.

Related reading: licensing UK technology to Indian companies.

Quick answers

When did the UK-India Double Contributions Convention come into force?

On 15 July 2026, alongside the UK-India trade deal.

How long can UK staff be exempt from Indian social security?

The published treaty text refers to 36 months, while Indian officials have said the period was extended to 60 months. Plan around 36 months until official guidance confirms otherwise.

Is the exemption automatic?

No. The employer must obtain a certificate of coverage from the home country, HMRC for UK staff, before the assignment starts.

Final word

Halverton & Co. is an Indian law firm that advises on Indian law, including secondments to India, Indian EPF and labour code compliance, and permanent establishment risk. We practise in Jharkhand, Maharashtra and before the Supreme Court of India, and we work alongside your UK solicitors, who advise on English law. Halverton & Co.: Where tech needs law! If you have a question about Indian law, write to us at office@halvertonandco.com, or get in touch.

This article reflects developments reported up to early October 2026. It is for general information only, is not legal advice, and does not create a solicitor-client relationship. Halverton & Co. is an Indian law firm, is not authorised or regulated by the Solicitors Regulation Authority, and does not advise on English law or UK tax.