Is our expat offer a good one?

superk8

Hi...
My husband has been offered a 2 year expatriate assignment to Chennai, and we are trying to determine if it is a typical/ fair offer. His salary would increase slightly from what it is now, as well as the following:

housing: 135,000 inr/month
cost of schooling for our children will be covered
one home trip (to US) will be covered per year
basically all relocation fees will be covered

Is this a fair amount for housing? Also, they would be taking about $1300/month out of his salary to cover part of the housing costs, then giving us the 135,000 inr each month. Is this typical?

My other concern is that drivers and cars are not mentioned in the offer at all. From doing a bit of research, it's clear that these things are a necessity. What is reasonable to ask for? Keeping in mind that we have a family of 5, so we would need a decent sized vehicle.

Any information would be helpful. Thanks in advance!!

Khak

my two pence (although I'm not an expat living in India)->

INR 1,35,000 is HUGE amount for house rent; infact I doubt whether you can get any house for that amount. you will get decent house for 30,000 - 40,000 INR per month

USD 1300 * 40 = 52000 - so actually your company may not be subsidizing for the rent

car is ABSOLUTE NECESSITY in India, specially for expats...new car for 5 member family will cost at least 7,00,000 INR plus driver will be around 4000 INR per month

expats staying in chennai can give better answer........

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ISN

Your house rent allowance is good, yes you will require a car and a driver in Chennai to survive, ask your husbands company to negotiate allowance for car and driver. You can buy a second car on your own small cars are cheep. Do you own a house in USA if you do and if you have to pay mortgage on that house then it is not a good deal, they should not be taking $1300 from your pay. Me and my wife are originally from Chennai, now we are living in Minnesota if you need more info about Chennai, India you can email me or give me a call.

Take a look at the type of house you can rent in your budget. http://www.primelocator.in/search-properties.php

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KABAARY

That sounds strange...

The salary includes a component for House Rent Allowance (HRA)/Company Leased accomodation (CLA)..the difference between the two (HRA v/s CLA) is :

(i) HRA : You rent the house in your personal capacity...which means that you (rather than your employer) pays the landlord as the house rent contract is directly between you and the landlord. In this case, your employer would pay you your salary inclusive of the HRA component net of withholding taxes…note that HRA is eligible for tax deductions (Section 10(13A) read with Rule 2A) and the employer would adjust the tax withheld by them accordingly to take cognisance of such an eligibility upon submission of appropriate proof of rent paid.

(ii) CLA : In this case, the employer directly enters into a rent contract with the landlord and pays the rent to the landlord directly...so the rent paid would not figure in your monthly pay slip. Tax would not be withheld (as regards your salary) by the employer with respect to the rent so paid by them except to the extent of the perquisite value of the rented accommodation which is determined in terms of Section 17(2)(i) read with Rule 3(1).

So how does the question of the employer recovering a part of the salary and then reimbursing an amount arise ?

superk8

I think they would take out the money in a lump sum, then do the CLA that you mentioned, but I'm not sure. That looks like something we'll have to get details on.

Thanks for your replies!! Another question: being from the US, what are some things that I would be looking for in a house that may not always be standard?

superk8

Thanks for the website - it looks like a very good resource. We do own our home, but plan to sell before we leave.

ISN

1. Air Condition: There is no concept of centralized AC in Chennai India so make sure that all bedrooms have a AC unit
2. Water availability: Most of the individual house has wells water and a over-head tank make sure that you have enough capacity.
3. Generator: Electricity is a problem; there are power cuts so make sure the house has a generator backup.

wonderwomanusa

Be sure t with your local (US) taxperson about those figures, as they will affect your US tax return.

Nick-H

Electricity is a regular problem, but power cuts usually only last half an hour or even five minute, sometimes a couple of hours. A generator is an expensive luxury item, but it can be lived without quite easily. You need UPS for your computer gear, maybe an 'inverter' (like a UPS but much less sophisticated) to keep a few houselights and one or two fans going through the cuts.

I have only known two whole-day cuts in the past three years; they have both been in the last few months, the latest one this week, since which our voltage has been very low.

Chennai seems to be one of the most popular destinations with posters to this site, and I think you can find answers to most of a new-comer's questions in the existing threads here, along with general tips about day-to-day life in a city where a lot of stuff just works differently to life in your home country.

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ISN

I am also in the process of selling my house in USA and moving back to Chennai, India. I started the process of selling my house 3 months ago still no good offer, hopefully this bad housing market in USA will change.

mirjamd

I met an American family who blew out half of their electronic equipment, because they didn't use a voltage stabilizer. They are separate units you connect between the power supply and the equipment. Electricity is not always stable here and I think US products use a different voltage....

superk8

This info is all very helpful - thanks!
It seems like most of the housing I've seen listed online (mostly on the primelocaters website) does include a backup generator.
I was told that ovens aren't common in many houses in India. Is that true? How difficult are they to come by?
Also, what are the options for securing a car? Could we get our company to lease or do we have to buy?
Thanks!

ISN

Yes you are right, Ovens are not common, but there are many brands available in India Checkout this link http://www.compareindia.com/products.php?sectionid=41

Car: The economical way is to buy a car and sell it when you leave; the second option is lease; or buy a used car. Ask your company for vehicle allowance and you can buy a car and sell it when you leave.

superk8

Would I need to purchase the oven, then sell it when we leave? If this is the case, are there other expats selling these types of things as they leave?

Best of luck on the sale of your home. We have friends in Minnesota (Apple Valley?) and have visited lots of times. I hope you've enjoyed your time there. It looks like we will be listing our home as soon as we are able to get the Chennai offer figured out.

Nick-H

Even better: get your company to arange a car and driver for you!

Ovens are easily available from large electrical shops, but are not often found in Indian kitchens, no. We've got one, and I roast a chicken every week! (the chicken is getting a bit fed up with it ).

The easiest and, probably, cheapest, way to have an oven would be to buy a top-of-the-range microwave combination; microwave, grill plus convection oven. To be honest, I wish I had done that, rather than buying a much more expensive electric oven!

So far, I have not had a power cut while roasting that chicken...