Looking for the benefits of an LLC? Let's go through the pros and cons and important things to consider when starting your limited liability company.
India is home to the second-highest number of freelancers in the world, after the US. The massive, largely English-speaking country on the Asian subcontinent has over 15 million freelancers, concentrated mainly in the IT and software development industries. The gig economy is on fire right now as large corporations and startups alike seek out contract work to fill in skills gaps and keep costs low.
If you’re looking to start out as a freelancer in India, this article will provide some essential tips and tricks for starting your self-employment career, navigating the bureaucracy and revenue services, and assembling the skills you need for success.
So you’re doing contract work for an organization. You’re not their employee, but does that make you self-employed, or a freelancer? The difference can be confusing.
If you’re self-employed, that means you technically own your own business. But it’s only freelance work if you do it on behalf of another company or organization - not say, for an independent plumber working for private homeowners. All freelancers are self-employed, but not all self-employed people are freelancers.
Whatever your purpose - travel, work, or education - all travelers to India, excluding those from Bhutan and Nepal, must have a visa, and the Indian government offers them in numerous categories. You also can’t obtain a visa when you arrive in the country, so you need to have it arranged before you travel there.
If you or your spouse are of Indian descent, you can be granted an entry visa that lasts for up to six months and work freely in the country, but that privilege only applies to a limited number of people.
For everyone else, India doesn’t have a visa category for freelance work. To work within India, you typically must have a secure job with an Indian company or be married to an Indian national. However, you can obtain an employment visa without being a proper employee of a company if you’re doing ongoing consulting or contract work for them at a fixed rate.
To properly embark on a freelance career, you may first need to find work and come with an employment visa, then create a firm, name it, and have it approved by the Registrar of Companies. You must also fill out an application called a Memorandum of Articles of Association and have it approved by an organization called the Superintendent of Stamps. Snazzy names all over.
As you can see, the visa application process can be confusing, so it’s best to consult an attorney or the local Indian consulate - or both - to make certain you comply with residency and employment requirements.
One extra tip if you’re a journalist - it’s a good idea to simply put your occupation down as self-employed/freelancer, as the Indian customs agency has been known to deny entry to journalists, even if they’re on vacation.
The cost for an employment visa in India varies greatly depending only which nationality you are. There are several fees you must pay during the process. The list below outlines the total fee for a one-year, multiple entry employment visa as of summer 2017.
- US citizen: $167.70 (€142.48)
- Australian citizens: $227.70 (€193.73)
- UK citizens: $507.70 (€431.96)
As a skilled expat worker, you’ll likely get paid through an online platform. There are many options, such as Western Union or Paypal. But you’ll want to be aware of the fees and exchange rates charged by different financial institutions. Most banks and transfer services seem to charge low up-front fees, but take advantage of you by using a higher exchange rate than the one you find on Google, and then pocket the difference.
To receive payments and have the largest amount left over when you collect it, give Wise a try. That way, your money will be converted at the real exchange rate - the same one you’ll find on Google or XE - and that should make sure you get to keep more of your hard-earned cash.
As a freelancer, you’re responsible for reporting your income to the government and paying a tax on it. If all your income comes from abroad, though, you only need to pay a personal income tax.
You may be required to complete additional filings and be subject to specific reporting requirements. To be certain you satisfy taxation regulations, it’s wise to keep a careful record of your invoices and expenses and consult an accountant for advice on how to remain tax compliant back home and in your new country.
In addition to income tax, full-time freelancers are often also required to pay a service tax. If you earn over 10,000 rupees a year from freelance work, you must add the service tax rate to your client billing and then pass that payment on to the revenue service. The service tax rate is 12.36%.
It’s important to research the possible deductions you can claim to reduce your overall tax burden. Freelancers who do content, marketing, development and IT work can often claim office, travel, and meal expenses. So before you file your taxes, discuss your possible expenses with a savvy accountant and see how much you can save.
While most people pay income taxes yearly, you’ll need to keep in mind that if your tax liability exceeds 10,000 rupees a year, you’ll be required to pay taxes quarterly, not annually.
All sorts of global companies are hungry for freelancers with a diverse array of skills, so there are several websites that allow organizations and skilled workers to find each other. One of the most popular is Upwork. While it’s not based in India, Upwork does allow you to apply a filter for jobs that are inside the country only. Several other freelance websites operate globally but still allow you to search for work in India alone, such as Freelancer.com.
As a freelancer, you may be anxious about when, or even if, you’ll get paid for a job. The website WorkNHire directly addresses that concern by using an escrow model for freelance solicitors, so you never have to worry whether you’ll get stiffed.
One of the most appealing parts of freelance work is that you can work at home. You don’t have a commute, you can work in pajamas, and you don’t have to smell your co-worker’s tuna sandwich during lunchtime. But many freelancers find spending both their working time and leisure time at home to be stifling and a little maddening.
As more and more people work from home, “co-working spaces” have risen in popularity. They effectively replicate the office environment, albeit often with a more chic decor, by filling a large space with desks, long tables, Wi-Fi, as well as coffee and tea services. Freelancers pay a flat monthly rate for access to the space, and find the option of getting out of the house and working a few hours a week amongst others worth the expense.
Research the sites cited above and create a user profile for yourself on each of them. Make sure to use an up-to-date photo and list as many marketable skills as you can reasonably claim.
Before you start competing for gigs, though, it’s important to determine your rate. You are competing with other freelancers in your skills space, so you if you overcharge you won’t get work. But if you undervalue yourself, you could be costing yourself thousands of dollars in the course of a year. Spend some time researching the market value of your skills set and determine a solid hourly rate for your efforts.
This may seem obvious, but reliability is a crucial freelancer’s skill. That means responding to messages quickly, communicating in a professional manner, being open to feedback, and most importantly, turning work in on time. When you take on work, you must meet your deadlines. You can always gain more skills, but if you don’t turn in assignments on time and sink your reputation, it won’t matter. You can also create and send your invoices by using our downloadable free invoice templates, and use an independent contractor agreement template to make your work official.
A world of opportunity and flexibility awaits a freelancer who can market his or her skills, complete work reliably and on time, and continue to seek out new clients. Whether you choose to live in a megacity like Mumbai or the quiet countryside, India is a massive, varied, exciting country. With a growing, modernizing economy, Indian companies will be demanding skilled contract work for years to come. Find your place!
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
The single-member is used to recognize that the LLC has one owner. Also,
One main difference between an S corp and a C corp is how they are taxed. Find out more about their benefits and detailed comparison.
Trying to figure out the sole proprietorship advantages are? Flexibility, Low startup costs, Financial stability, ease of establishment, and more.
Looking to learn more about online side jobs? Let’s lay out the best side hustles, where you can find them, and resources that will make your life easier.
Looking for the ins and outs of how to become a consultant? Look no further. Here we put together tips, requirements, and industries where you can get started