Navigating L1 Visa Rules: Salary, Duration, and Tax Concerns Explained

Hi Arpit, I have some questions regarding L1 visa rules that I hope someone can help clarify:

1. When we grant an L1 visa to a person, should they receive an Indian salary or a salary from the USA?
2. Is it possible to send them for short durations multiple times, for example, for 3 or 4 months each time?
3. Does he need to pay taxes in the US even if we are covering his lodging and daily expenses?

I would appreciate a prompt response.

Thank you.

Hi Arpit, a L1 visa holder should be paid a minimum salary on an annual basis or per diem salary in the USA. Along with this salary, they should be paid the basic component of the Indian salary. Yes, you can send them for short durations. If he is paid as a W2 employee, then he has to pay the taxes, and in case the employer is paying the taxes, then he should not pay the taxes again. But he shouldn't be taxed both for the US and Indian salary. In other words, his Indian salary should be tax-free.

Regards,
Sasmita

Thank you for the reply. So, should the travelers' payroll be changed to the US division? Or can they carry their per diem when they leave for the US?

(I might be wrong with the statement below) I read somewhere that if a traveler returns to their home country before 180 days, then they do not need to pay tax (or the tax will be refunded)? So, is this 180-day timeframe cumulative when the traveler travels again after a few months?

Thank you,
Arpit Pradhan

Payroll and Taxation for Travelers on L1 Visa

It's better to transfer the travelers' payroll to the US division for proper tax deductions and payments as per US taxation. Secondly, if they return within 180 days, the tax is to be refunded to them. The 180 days are not additive. The time period of stay depends on the I-94, which is issued along with the visa. Once a traveler is back from the US, their I-94 is valid for the next 180 days. If they have to travel back to the US for another assignment after 180 days, they have to apply for a fresh I-94.

In the context of the above queries, I too would request clarification for the following scenario: I have an L1 visa type.

- I went to the USA on a per diem from September 29, 2010, to March 11, 2011. This tour equates to 165 days.

My Queries Are as Follows:

- Can I travel back to the USA for another 180 days?
- The immigration officer had stamped my stay until March 9, 2012, when I landed in the USA in September 2010.
- Is there any condition that during the USA financial year (Jan-Dec) my stay can only be 180 days, i.e., if I have spent Jan-Feb-March in the USA and returned in March, then my next travel back to the USA will consider adding these three months (i.e., my next stay cannot be more than 90 days)?

Please guide me on this situation. Thank you in advance.