Totalization Agreement between US and India: What you need to know

The United States of America and India have signed a totalization agreement. The agreement aims to eliminate dual social security taxation for individuals who work between the two countries. The totalization agreement, also known as the Social Security Totalization Agreement, will streamline social security benefits and taxes between the two nations.

Here`s what you need to know about the Totalization Agreement between US and India:

What is a Totalization Agreement?

A Totalization Agreement is a bilateral agreement between two countries that aims to eliminate dual social security taxation. It ensures that workers who are sent by their employers to work temporarily in the other country will not have to pay social security taxes in both countries on the same income. It also ensures that such workers are not deprived of social security benefits they may have earned in either country.

What is the Social Security Totalization Agreement?

The Social Security Totalization Agreement is a type of Totalization Agreement that the United States has signed with several other countries. This agreement enables workers who have paid into the social security system in both countries to combine their credits for the purpose of qualifying for retirement, disability, or survivor benefits.

What are the benefits of the Totalization Agreement between US and India?

The Totalization Agreement between US and India will benefit companies that send their employees to work in the other country. These employees will no longer have to pay social security taxes in both countries. Instead, they will only pay social security taxes in the country where they are working.

Additionally, the Totalization Agreement will enable workers who have paid into both the US and Indian social security systems to combine their credits and qualify for benefits in both countries. This will benefit workers who have worked in both countries for a part of their career.

When will the Totalization Agreement between US and India come into effect?

The Totalization Agreement between US and India will come into effect after both countries have completed the necessary internal procedures to bring the agreement into force. The agreement will be valid for workers who are sent from one country to the other on or after the date when the agreement comes into force.

In conclusion, the Totalization Agreement between US and India is a significant development that will benefit workers and companies in both countries. The agreement will streamline social security benefits and taxes and eliminate dual social security taxation for individuals who work between the two countries.