Indian payroll vendors come in three flavours: low-cost local firms (₹50-150 per employee per month), India-specialist platforms with dedicated-consultant models (₹250-600), and premium global incumbents (₹700-1,500). All three deliver basic payslip computation. They diverge sharply on compliance depth, query response, and what happens when something edge-case breaks.
Build vs buy — when in-house makes sense
For most foreign-owned subsidiaries, outsourcing payroll is the default. In-house payroll only makes sense when:
- Headcount is 200+ and you can justify a full-time payroll specialist + payroll software licence.
- You have unusual compliance complexity (multiple entities, multiple states, GIFT City presence) that vendors are not set up for.
- Data-residency requirements prevent processing through a vendor's infrastructure.
Below ~200 employees, vendor outsourcing wins on cost and quality. Above that, hybrid models (vendor software + in-house operator) become competitive.
What to insist on
- Named point of contact, not a ticket queue. A CA-qualified human who knows your specific salary structure and state combinations.
- Full compliance stack — PF, ESI, PT (all states you operate in), TDS-on-salary, TDS-on-contractor, gratuity provisioning, professional tax in every operative state.
- Form 16 (or Form 130 from FY 2026-27) issuance with reconciled Part A and Part B, digitally signed.
- USD reporting layer for your foreign parent's consolidation.
- Audit-ready document repository — every payslip, every ECR, every challan, every Form 16 retrievable on demand for 8 years.
- Clean offboarding clause — full data export in standard formats (CSV, PDF) if you leave.
Questions cheap providers can't answer
- Show me your last three PF inspection findings from an Indian customer.
- Walk me through how you handle a mid-year tax regime change for an employee.
- How do you reconcile Part A (from TRACES) and Part B (from your system) for Form 16?
- What happens when ESIC sends a recovery notice for a period before our contract started?
- How do you handle a multi-state employee who moves from Bengaluru to Hyderabad mid-year?
- What's your standard turnaround for an EPFO show-cause notice?
FastLegal's dedicated-consultant model
We sit in the India-specialist tier — ₹250-600 per employee per month range — but with a single named CA-qualified consultant per workspace. They own your filings, your edge cases, and your reporting to the foreign parent. No ticket queues, no first-line / second-line layers.
Realistic pricing in 2026
| Tier | Per employee per month | What you actually get |
|---|---|---|
| Bottom | ₹50-150 | Payslip + bank file. Compliance partial. Cheap is expensive when EPFO sends a notice. |
| Mainstream SaaS | ₹150-400 | Self-serve dashboard, full compliance, ticket-based support. Fine for HR-led teams that don't need hand-holding. |
| India specialist | ₹250-600 | Dedicated consultant + full stack + USD reporting. Best fit for foreign buyers. |
| Premium global | ₹700-1,500 | Brand name on the invoice. Same compliance, fancier slide decks. |
Red flags that should kill the conversation
- Vendor sales pitch focuses on dashboard features, not compliance audit history.
- No state-specific filing capability beyond Karnataka and Maharashtra.
- Implementation timeline of <5 days for a clean migration — usually means they're skipping setup work.
- Cannot show you a sample EPFO notice they've handled.
- Quotes 'starting from ₹X' but the X excludes ESI compliance / multi-state PT / TDS filing.
- Doesn't offer a 30-day or 60-day exit clause without penalty.
Frequently asked questions
Can our US parent's payroll vendor (ADP, Gusto, Rippling) handle India?+
Their 'global' modules typically white-label an Indian EOR underneath. Compliance is fine; you're paying the US vendor's margin. If you're already an EOR customer of the underlying provider, going direct can save 25-40%.
Should we negotiate a per-employee fee or a flat fee?+
Per-employee for small teams (under 50), flat with tiered overages for larger. Avoid 'all you can eat' flat fees that cap at suspiciously low headcounts — vendors discover ways to push usage out of scope at scale.
What about data security and SOC 2?+
Mainstream and India-specialist vendors should have SOC 2 Type II or ISO 27001. Ask for the most recent attestation. Premium vendors typically have both.
How long is a typical contract?+
12-24 months with 60-day notice. Anything longer with high termination fees is a red flag — confident vendors don't need contract lock-in.
Stop reading circulars. Start running clean payroll.
Every FastLegal plan ships with a dedicated payroll consultant — a real human who runs your PF, ESI, PT, TDS and Form 16 issuance, configured to your salary structure, your state, and your hiring plan. You sign off. We do the rest.