Key takeaways
- A US court vacated the $100,000 H-1B fee in June 2026; it isn't being collected, but the legal fight continues.
- US companies can build in India through a vendor, an employer of record or their own subsidiary (GCC).
- A cost-plus Indian subsidiary is the usual long-term structure.
Where the fee stands (October 2026)
- A September 2025 proclamation imposed a $100,000 payment on new H-1B petitions for workers outside the US.
- In June 2026 a federal court in Massachusetts held the fee unlawful and vacated it; the appeals court refused to pause that ruling in July, and the fee has not been collected since.
- Another court upheld the fee in December 2025, and a new proclamation in September 2026 extended it to September 2027 — so the legal position is unsettled. Check with immigration counsel before relying on either outcome.
Three ways to build in India
| Option | Speed | Control | Best for |
|---|---|---|---|
| Outsourcing / vendor | Fast | Low | Defined projects |
| Employer of record | 1–2 weeks | Medium | First 5–10 hires |
| Own subsidiary (GCC) | 1–2 months | High | Long-term teams |
Compare them: hiring without an entity · setting up a GCC · India entry structure chooser.
Tax and cost points
- A subsidiary billing the US parent cost plus a markup; eligible IT and ITeS units can use the safe-harbour option under India’s Income-tax Rules, 2026.
- Services exported to the parent can be zero-rated for GST.
- Staff without an entity can create permanent-establishment risk — plan before hiring.
Sources
Frequently asked questions
Is the $100,000 H-1B fee still in effect?
As of October 2026 it is not being collected: a federal court vacated it in June 2026 and the appeals court refused to stay that ruling. But another court upheld it and a new proclamation extended it to 2027, so the position is unsettled — check with immigration counsel.
How can a US company build a team in India?
Through an outsourcing vendor, an employer of record for the first hires, or its own Indian subsidiary (often called a GCC) charging the parent cost plus a markup.
Is a GCC in India tax-efficient for a US company?
It is taxed in India on its markup, usually at a 22% base rate option, and services to the parent can be zero-rated for GST; transfer-pricing documentation is essential.
Please note: this guide is general information based on the rules as they stood on the review date above. Regulations and RBI/CBDT procedures change often — please get advice on your specific facts before acting.