Latest news with #SideLetters

Business Standard

Double contribution convention to help Indian workers and firms in UK: Govt

India and the UK have secured an agreement on the Double Contribution Convention alongside the free trade agreement, which many believe will help smooth the operations of Indian IT services companies. 'It will exempt Indian workers and their employers from social security contributions in the UK for up to three years, significantly improving take-home pay and reducing costs for Indian companies,' the government said on Thursday. Commerce Minister Piyush Goyal said in a post: "The three-year exemption from social security contributions in the UK as part of the Double Contribution Convention is a significant breakthrough for Indian workers and their employers." The Indian IT services industry has a huge presence in the UK. The region is the second-largest in terms of revenue, alongside Europe. Indian IT services players also send thousands of skilled Indian employees on projects to the UK. Tata Consultancy Services (TCS), India's largest IT services player, has roughly about 24,000 employees in the UK. However, it could not be ascertained how many of these are from India and on temporary work. According to industry experts, about 11,000 could be Indian employees sent onsite. Infosys has a headcount of around 6,000 in the UK, and Europe's contribution to the company's revenue was 31.2 per cent in the fourth quarter of FY25. HCLTech, the country's third-largest IT services player, has about 4,000 employees in the UK. According to the firm's website, it has over 12 delivery centres in the UK and 14 innovation labs. "The DCC, once finalised, will allow such employees to contribute only in their home country for up to 36 months, reducing costs and compliance burdens. This is particularly relevant for sectors like IT, manufacturing, and consulting, where short-term international mobility is critical. The Side Letters are a strong signal of intent and pave the way for a more predictable and efficient framework for cross-border workforce deployment," Puneet Gupta, partner, People Advisory Services - Tax, EY India, said. Bengaluru-based Wipro has around 4,200 employees across the UK, Ireland, and Scotland. In terms of revenue mix, Europe, which also includes the UK, contributed 26.1 per cent for Q4 FY25.