r2i forum

Hi-
I am on H1B at present and it is valid until May2013 as per I797A. But I am coming back to India, so I submitted my resignation in the office here in USA. But my company offered me the option of working from home in india as a contractor. So my US company is going to cancel my H1B once I come to India. I will be working from my home in India. My company is MNC but they do not have any offices or branches in India. They offered me salary (10Lack Inidan rupees per year) and they said I do not have to pay any taxes in India. But I am not sure whether they will be paying this option 1) in US dollars in to my bank of America account or option 2) in Indian Rupees in to my indian bank account. It is not decided yet.

I am assuming i just need to pay tax to Indian government because I am indian citizen and will not have any legal status in US, once i return to India. Is this correct?

Which option should I choose? Option 1 or 2 ? Are the option 1 and 2 same or any difference?

Can my US company pay me directly either using option 1 or 2 ? Is it legal ? or should they pay to a company in India(Say z) instead of me and that company in India(z) should pay me the salary and run my payroll and hence take care of my taxes?

I searched the forum for answers but could not find H1B cases. My knowledge of tax details are very bad as you can see from my questions above. I would really APPRECIATE if one of you can answer my questions with out shouting at me saying "search the forum".

I really need your input. PLEASE help me out,..

As far as the Indian Govt. is concerned, your having H1B or not is of no concern.
If you are resident in India than you have to pay taxes on your income. During RNOR, you can escape incomeTax on foreign income, however, money paid in greenbacks is also taxable in india as long as it is for work done in India. Fact whether it is paid in India or in usa in Indian rupees or in US dollars makes no difference.

There is another fly in the ointment. The usa company has to deduct TDS on your salary and pay it to Indian Govt. They have to acquire a TAN (not the sun kind) and complete some paper work.

There is another thread that explains all this in detail. If you can not find it, ask boca to find it for you.
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dbs;355396

There is another fly in the ointment. The usa company has to deduct TDS on your salary and pay it to Indian Govt. They have to acquire a TAN (not the sun kind) and complete some paper work.

This applies only to employees but not for those who are contractors.

spartan;355470This applies only to employees but not for those who are contractors.

[QUOTE]They offered me salary

employee?

dbs;355923employee?

upendra;354478 But my company offered me the option of working from home in india as a contractor.

Contractor?