India Entry Services

Company Incorporation in India for Foreign Companies

Wholly owned subsidiary, branch office or liaison office. IMC takes a foreign parent from structuring decision to a funded, compliant Indian entity, under one point of contact.

  • Four decades of cross-border advisory
  • India, UAE and Singapore under one practice
  • 100% foreign ownership in most sectors
Company Incorporation in India for Foreign Companies
SPICe+ RegisteredFiled with the MCA
  • 45+years of cross-border advisory
  • 1,200+entities incorporated for foreign parents
  • 3jurisdictions: India, UAE, Singapore
  • 50+countries of parent origin served

Quick Answer

How does a foreign company incorporate in India?

A foreign company incorporates in India by registering a private limited company, which is most commonly structured as a wholly owned subsidiary, using the SPICe+ form on the MCA portal. The parent can hold 100 percent of the shares in sectors open under the automatic route. At least one director must be resident in India. Four to six weeks is a realistic timeline.

The short version

  • A wholly owned subsidiary is the route in most inbound projects, because liability is ring-fenced and the domestic tax rate applies.
  • At least one director must stay in India for 182 days during the financial year, under Section 149(3) of the Companies Act, 2013.
  • Form FC-GPR must be filed within 30 days of allotting shares against the parent's remittance.
  • Press Note 2 of the 2026 series relaxed the land border country approval requirement to a 10 percent beneficial ownership test.

Company registration in India has been a largely digital, single-form process since SPICe+ replaced the older filings. What takes time is everything around it: getting the parent board's documents apostilled in the home jurisdiction, opening a bank account that will accept an inward remittance from the parent, and reporting that remittance to the Reserve Bank of India inside the window.

FDI Data

What the inbound numbers say about entering now

Two datasets are worth having in front of you before a structure is chosen, because they explain where the competition for talent and premises actually is.

DPIIT reports FDI equity inflow. The Reserve Bank reports gross FDI of US$94.84 billion for the same period, which includes reinvested earnings and other capital. Both figures are correct and they measure different things, so it is worth checking which one a competing adviser is quoting.

Structures Compared

Which entry route should a foreign company use?

Six structures are available, in two families. A subsidiary or joint venture creates a new Indian company, separate from the parent and taxed as a domestic company. A branch, liaison or project office is the parent itself operating in India through a registered place of business, taxed at the foreign company rate. The choice decides what the India operation may invoice for and what the parent is exposed to.

India entry routes for a foreign parent, compared
RouteParent stakeWhat it may do in IndiaApprovalTax on India incomeTypical use
Wholly owned subsidiaryUp to 100%Any activity permitted to an Indian company in a sector open to FDI. Invoices, hires, imports, borrows.Automatic route in most sectorsDomestic company ratesLong-term operating presence, GCC, product or services company
Joint ventureBelow 100%Same as a subsidiary, subject to the shareholders agreement and any sectoral cap.Automatic or government route by sectorDomestic company ratesSectors with FDI caps, or where a local partner brings licences or distribution
Branch officeNot applicableExport and import, professional and consultancy services, IT services, buying and selling agency work. May earn income and remit profit.AD Category-I bank, RBI in some casesForeign company rateEngineering, EPC and professional firms servicing Indian clients directly
Liaison officeNot applicableRepresentation and market research only. May not invoice, may not contract commercially, may not earn income.AD Category-I bankNo taxable income if restrictions observedMarket testing before committing to an operating entity
Project officeNot applicableWork under one specific contract awarded by an Indian party, and nothing else.AD Category-I bank where funding conditions are metForeign company rateSite-based infrastructure and turnkey contracts
LLPUp to 100%Business activity in sectors allowing 100 percent FDI under the automatic route with no performance conditions.Automatic route, restricted sectorsPartnership taxation, no dividend taxProfessional services and asset-light ventures wanting pass-through treatment

Most inbound projects end as a wholly owned subsidiary. The two worth a second look are the branch office, where the India work is genuinely an extension of contracts the parent already holds, and the LLP, where the group wants pass-through treatment and can live with the sectoral restrictions.

Not sure which route fits? Send us the sector and the parent jurisdiction and we will come back with a view.

Get a route recommendation

Recommended Route

Wholly owned subsidiary registration in India

A wholly owned subsidiary is an Indian private limited company in which the foreign parent holds the entire shareholding, save for one share held by a nominee to meet the two-shareholder minimum. Once incorporated it is an Indian company for almost every purpose: it contracts in its own name, employs, registers for GST, bids for work closed to foreign entities and holds intellectual property.

  • Liability is ring-fenced

    The parent's exposure is limited to its subscribed capital. A branch office carries no such wall. Liabilities incurred in India are the foreign company's own, enforceable against its global balance sheet.

  • Activity is unrestricted within the sector

    A subsidiary is not confined to the parent's existing lines of business the way a branch office is, and it is not barred from earning revenue the way a liaison office is.

  • The tax rate is materially lower

    About 25.17 percent effective under the concessional domestic regime, against the 35 percent foreign company rate that applies to a branch office. Roughly ten percentage points before any planning.

The trade-off worth pricing first

A subsidiary adds a second layer. Profits distributed to a foreign parent attract dividend withholding, whereas a branch office remits post-tax profit without a further distribution tax. Where a group expects to repatriate most of what it earns rather than reinvest it, run that arithmetic before the structure is fixed.

Getting Ready

Eligibility and documents

No approval is needed before incorporating a subsidiary in a sector open under the automatic route. There are conditions the company must satisfy at registration, and one of them reshapes plans.

Conditions at registration

  • Two directors. Minimum for a private limited company. No bar on both being foreign nationals, subject to the residency condition.
  • One resident director. 182 days in India during the financial year, proportionate in the year of incorporation.
  • Two shareholders. The parent plus one. Standard practice is a nominee holding a single share, with beneficial interest declared in Form MGT-6.
  • Digital signatures. Class 3 DSC from an Indian certifying authority for every director and subscriber. Video verification for applicants abroad.
  • Registered office in India. Physical address able to receive statutory correspondence, with utility bill and owner NOC. Several banks will not open an account against a virtual office.
  • No minimum paid-up capital. Set it against what the business needs, because it is the amount remitted and reported under FEMA.

Documents from outside India

  • Apostille or consular legalisation

    Documents from a country party to the Hague Apostille Convention of 1961 are notarised locally and then apostilled by the designated competent authority. One certificate, no embassy involvement.

    Documents from a non-Convention country are notarised, legalised by the foreign ministry, then attested by the Indian embassy or consulate. Three steps, and the embassy queue is the least predictable part of the whole project. Any document not in English needs an official translation, authenticated with the original.

  • From a foreign individual director or shareholder

    Passport, apostilled or consularised. Proof of residential address, typically a bank statement, utility bill or driving licence. Passport-size photograph. Signed consent to act as director in Form DIR-2 and the declaration in Form DIR-8.

  • From a foreign corporate shareholder

    Certificate of incorporation. Charter documents, being the memorandum and articles or their local equivalent. A board resolution approving the subscription, fixing the shareholding and naming an authorised representative to sign on the company's behalf. All apostilled or consularised.

  • The timing trap on address proof

    Address proof carries an age limit. The window accepted for foreign nationals is longer than the two months applied to Indian residents, but it is still finite, so documents gathered at the start of a slow apostille cycle can expire before the filing goes in. Collect them once the name is reserved, not before.

The condition that reshapes plans

Section 149(3) of the Companies Act, 2013 requires at least one director who stays in India for not less than 182 days during the financial year, applied proportionately in the year of incorporation. The test is physical presence, not citizenship: a foreign national actually in India for the required period satisfies it.

A group entering India for the first time has nobody who meets the test on day one. There are two workable answers. Appoint a professional nominee director under a written mandate with an indemnity for the first year, or bring forward the hire of the India country manager so the appointment is genuine from the start. The second is slower and considerably safer.

A large amount of published guidance still says "previous calendar year". That was the position before the section was amended. Anyone relying on it is working from superseded text.

Registration Process

Indian subsidiary registration for foreign companies: step by step

SPICe+ consolidates what used to be several separate filings. One submission produces the company, its Corporate Identity Number, its PAN, its TAN and, if elected, its GST and employer registrations.

  1. DSC application · 2 to 4 working days

    Obtain digital signatures

    Video verification for applicants abroad. Runs in parallel with document apostille.

  2. SPICe+ Part A · 1 to 3 working days

    Reserve the company name

    Two names may be proposed. An approved name is held for 20 days. Names resembling an existing company or a registered trademark are rejected, so run a trademark search first.

  3. SPICe+ Part B · 3 to 7 working days

    File the incorporation application

    Subscriber and director details, capital structure, registered office, and the DIN application for first directors.

  4. INC-33, INC-34, INC-9 · filed with step 3

    File the constitution and declarations

    Electronic memorandum and articles, plus the subscriber and first director declaration, auto-generated in most cases.

  5. AGILE-PRO-S (INC-35) · filed with step 3

    File the linked registrations

    EPFO and ESIC registration, professional tax where the state requires it, bank account opening and GST registration if elected.

  6. INC-11 · issued with step 3

    Certificate of incorporation issued

    Issued with CIN, PAN and TAN. The company legally exists from this date.

  7. Bank KYC · 15 to 25 working days

    Open the bank account and receive capital

    A separate process run by the bank, not the Registrar, and the single biggest source of slippage on an India entry project.

  8. INC-20A · within 180 days

    File the commencement declaration

    Confirms every subscriber has paid for their shares. The company cannot commence business or borrow until this is filed.

Steps 1 to 6 are typically two to three weeks once documents are in hand. Step 7 decides whether the project takes a month or three.

IMC runs all eight steps, including the bank.

Request a structuring call

Timeline & Budget

How long it takes and what it costs

Published timelines of seven to ten days describe the Registrar's processing, not the project. Measured from first instruction to a funded company that can trade, the honest range is four to six weeks, and longer where the parent sits in a non-Convention country or the sector needs government approval.

What drives the cost

Cost headBasisWhat drives it
MCA filing feeSlab on authorised capitalNominal at typical starting capital, waived or minimal up to prescribed thresholds.
Stamp dutyState of the registered officeVaries significantly between states. Maharashtra, Delhi and Karnataka are not the same number.
Digital signaturesPer signatoryHigher for applicants outside India because of the verification process.
Apostille or consularisationPer document, home jurisdictionOften the largest single line for a non-Convention parent, and the least predictable.
Professional feesFixed scopeIncorporation, drafting, name approval, filings and the first FEMA report.
Recurring complianceAnnualStatutory audit, annual filings, director KYC, FLA return, income tax return and, where applicable, transfer pricing certification.

Any provider quoting a single all-in figure without knowing the state of registration, the parent jurisdiction and the number of foreign signatories is quoting a range and calling it a price.

FDI & Compliance

FDI route, sectoral caps and FEMA reporting

Two questions have to be answered before the parent remits anything. Is the sector open under the automatic route, and does the investor trigger the land border rules?

Automatic route or government route

Most sectors are open to 100 percent foreign investment under the automatic route, which means no prior approval from any authority and reporting after the event. A minority carry caps or conditions, and a short list is prohibited outright.

Defence, insurance, print media, multi-brand retail and broadcasting each carry their own cap or approval condition. Check the position on any one of them against the current consolidated FDI policy rather than assuming it.

For Technology Groups

Foreign subsidiary incorporation in India for AI, SaaS and technology companies

The incorporation mechanics are identical. What differs is data, intellectual property and equity, and all three have moved in the last eighteen months. Computer software and hardware took US$13.95 billion of FDI equity inflow in FY 2025-26, the largest of any sector, and close to half of all capability centres established since FY2021 were built with an AI focus from the outset.

  • When a subsidiary beats an employer of record

    An EOR is right for a first hire or two, a pilot, or a sales presence. It stops being right when the India team creates IP the group needs to own cleanly, when headcount passes roughly fifteen to twenty, when equity is to be granted on the same terms as everyone else, or when Indian customers must be invoiced in rupees by an Indian entity.

  • Data protection under the DPDP Act

    The Digital Personal Data Protection Act, 2023 became operational when its rules were notified in November 2025. Cross-border transfer is currently permitted except to countries the government restricts by notification, and that list has not been published. The default is permissive, but permissive by government discretion rather than by right.

  • Algorithmic audits for Significant Data Fiduciaries

    An entity notified as an SDF must appoint a Data Protection Officer resident in India, appoint an independent auditor and conduct annual data protection impact assessments and algorithmic audits. The algorithmic audit reaches the models, not just the database.

  • Owning the IP the India team creates

    Indian copyright vests in the creator unless the work is made under a contract of service, and patent rights need explicit assignment. Employment contracts need a present assignment of work product, not a promise to assign later, together with a moral rights waiver so far as Indian law permits. Contractors and interns need separate written assignments, because nothing vests automatically.

  • Equity for Indian engineering talent

    A resident employee or director may acquire shares of the foreign parent under a stock option plan offered globally on a uniform basis. Where that condition is met, the acquisition is not squeezed into the ordinary remittance ceiling. Acquisitions below 10 percent without control are overseas portfolio investment, reported half-yearly through the Indian entity rather than by each employee.

The structuring decision with the longest tail

Where the Indian subsidiary develops IP the parent will own, the transfer is a related-party transaction needing arm's length pricing, usually a cost-plus development arrangement with the mark-up set from a benchmarking study rather than picked. Where the Indian entity retains the IP and licenses it out, royalty flows are subject to withholding and treaty analysis. The choice affects the group's effective tax rate, the valuation of the Indian entity at exit, and the transfer pricing exposure for every year in between.

Structuring choices specific to AI and technology groups
DecisionThe two optionsWhat usually settles it
IP ownershipParent owns and subsidiary develops on cost-plus, or subsidiary owns and licenses out.Where value will be realised at exit, and how much transfer pricing exposure the group will accept year on year.
Entity for a capability centreWholly owned subsidiary, or an LLP.Whether equity will be granted, whether external investment is possible later, and whether pass-through treatment is worth the sectoral restrictions.
CityBengaluru or Hyderabad for depth of AI talent, Pune or Chennai for cost, GIFT City for financial services use cases.Attrition and salary inflation in the target skill band, plus any state incentive package.
Data architectureProcess Indian personal data in India, or transfer under the current permissive default.Appetite for re-engineering later if a restricted country list or a localisation notification is issued.
Employment modelEOR for the first hires, or an entity from the start.IP cleanliness, headcount trajectory, and whether Indian customers must be invoiced in rupees.

Setting up an India engineering centre?

Talk to the technology entry team

Post-Incorporation

What compliance looks like after incorporation

Incorporation starts a set of clocks. The first year is the heaviest because one-time obligations sit alongside the recurring calendar.

First-year obligations

ObligationTimingForm or authority
Appointment of first auditorWithin 30 days of incorporationBy the board. If the board does not act, members must appoint within 90 days.
Bank account and receipt of capitalBefore the commencement filingAD Category-I bank
FC-GPR reporting30 days from allotmentReserve Bank of India, FIRMS portal
Declaration of commencement of businessWithin 180 days of incorporationForm INC-20A with the Registrar
GST registrationOn crossing the threshold, or earlier by choiceCompulsory from the first rupee for inter-state supply of goods and certain categories.
Labour and state registrationsUsually on first hireShops and establishments, EPFO, ESIC, professional tax

Tax & Repatriation

Tax position and moving money to the parent

An Indian subsidiary is taxed as a domestic company. Most newly incorporated subsidiaries opt into the concessional regime under section 115BAA, giving up most incentive deductions in exchange for the lower rate. The 15 percent rate for new manufacturing under section 115BAB required manufacturing to commence within a window that has closed, so it is not available to a company incorporating today.

EntityRateNote
Indian subsidiary, concessional regime22 percent base, about 25.17 percent effectiveSection 115BAA, with surcharge and cess. Most incentive deductions forgone.
Indian subsidiary, new manufacturing15 percentSection 115BAB. Commencement window has closed, so unavailable to a company incorporating now.
Branch office of a foreign company35 percent plus surcharge and cessReduced from 40 percent by the 2024 amendments.
Minimum alternate tax15 percent of book profitsDoes not apply where the concessional regime is elected.
  • Dividend

    Taxed in the hands of the non-resident shareholder, with withholding at the domestic rate plus surcharge and cess unless a treaty rate applies. Claiming the treaty rate needs a tax residency certificate, Form 10F and a no permanent establishment declaration.

  • Service, royalty and cost-plus payments

    Deductible for the subsidiary and the most flexible route, but squarely inside transfer pricing.

  • Capital reduction or buy-back

    Available, procedurally heavy, with its own tax treatment. Not a routine repatriation route.

Transfer pricing is where this goes wrong

Related-party transactions must be at arm's length, documented contemporaneously and certified in Form 3CEB. A mark-up set casually in year one is the benchmark an assessing officer applies in year five, and the interest on a four-year adjustment can exceed the tax. Setting it from a benchmarking study at the outset costs less than defending it later.

Common Pitfalls

Where India entry projects go wrong

Four problems account for most of the delay and cost overrun on inbound projects. None is at the Registrar.

  • The bank account treated as a formality

    Incorporation produces a CIN, a PAN and a TAN in a single filing. It does not produce a working bank account. Account opening is a separate KYC exercise run by the bank, it generally begins only after the certificate is issued, and for a foreign-owned company it involves the parent's constitutional documents, the full beneficial ownership chain and, at most banks, in-person or video verification of a signatory. Three to four weeks is normal. Groups that assume it runs alongside incorporation lose a month.

  • A resident director who exists only on paper

    The 182-day test is a test of actual presence. Where a name is lent for a fee with no involvement in the business, the individual carries full director liability under the Companies Act regardless of the private understanding, and the company carries the risk that the appointment is questioned in diligence. A nominee engaged under a written mandate with an indemnity, replaced by a genuine local appointment once the business has one, is the defensible version.

  • FC-GPR filed late

    The 30-day clock runs from allotment, not from the day the money lands. It is missed regularly because the allotment sits with the company secretary and the reporting is assumed to be the bank's job. It is not. The delay is regularisable through the Late Submission Fee, but an unreported inward investment surfaces in every subsequent FEMA filing and in every diligence exercise thereafter.

  • A liaison office chosen for a business that earns revenue

    A liaison office may not invoice, may not sign a commercial contract and may not earn income in India. It is sometimes selected because setup looks cheaper, and the constraint only becomes real when the first Indian customer cannot be billed. Converting to a branch or a subsidiary at that point restarts the approval cycle.

Why IMC

How IMC handles a foreign company setup in India

  • What the engagement covers

    Entry route analysis and FDI position. Name approval and incorporation. Apostille coordination in the parent jurisdiction. Bank account opening. FEMA reporting. Secretarial, payroll and tax calendar once trading. For technology groups: IP assignment documentation, transfer pricing policy and DPDP readiness.

  • Credentials

    Established in 1979. Offices in Delhi NCR, Mumbai, Dubai and Singapore. 150+ professionals. Registered with the ICSI, ICAI and ICMAI. India, UAE and Singapore are run as a single corridor practice rather than three unconnected offices.

What to bring to a structuring call

Four inputs settle the entry route in most cases: the sector, the parent jurisdiction, the expected first-year headcount, and whether profits are intended to stay in India or come back out. For an AI or software group, add whether the India team will create IP the group needs to own.

Case Studies

What these projects look like in practice

  • EOR to entity, eleven weeks

    A Series B SaaS company ran eleven engineers in Bengaluru through an employer of record for two years. The trigger to incorporate was not cost. It was a diligence question during a funding round about who owned the code. Migration covered incorporation, novation of employment, a fresh IP assignment executed by every transferring employee, and a transfer pricing policy for the cost-plus arrangement.

  • A month saved by moving one date

    A European industrial group planned a March incorporation to align with the parent year end. Because the Indian financial year closes on 31 March, the proportionate residency requirement for the stub period would have fallen due within weeks of the certificate being issued, and the nominated director had not been in India that year. Moving to April reset the clock at no cost.

  • A filing found in diligence

    A UK group discovered during a trade sale that two FC-GPR filings from its Indian subsidiary's early years had never been made. The amounts were small. The buyer would not close on an entity with an open FEMA position. Regularisation took six weeks and held up completion.

Meet The Team

Experts behind this service

The people who will actually run your India entry, end to end.

  • Shriya Mandal

    Shriya Mandal

    Director - Compliance

  • Deepakshi Sukhwani

    Deepakshi Sukhwani

    Senior Associate - Corporate Services

  • Mudita Gehlot

    Mudita Gehlot

    Senior Associate - Corporate Services

  • Poornima J

    Poornima J

    Director - Strategy & Operations

  • Ninad Parkar

    Ninad Parkar

    Director - Strategic Partnerships & Business Development

  • Aishwarya Shiva

    Aishwarya Shiva

    Director - Strategic Partnerships & Business Development

FAQs
Yes, in sectors open to 100 percent foreign direct investment under the automatic route, which covers most of the economy. The parent holds the shareholding directly, with one share held by a nominee to meet the two-shareholder minimum. No prior government approval is required in those sectors.
It is the incorporation of an Indian private limited company in which a foreign parent holds the entire shareholding. The company is registered through SPICe+ with the Ministry of Corporate Affairs and is treated as a domestic Indian company for tax and regulatory purposes even though its ownership is foreign.
Four to six weeks from first instruction to a funded company that can trade. The Registrar’s own processing is around two to three weeks. The rest is document apostille in the parent jurisdiction and bank account opening, which happens after incorporation and takes three to four weeks on its own.
It needs at least one director who stays in India for not less than 182 days during the financial year, applied proportionately in the year of incorporation. The test is physical presence rather than citizenship, so a foreign national genuinely in India for that period satisfies it.
No. The statutory minimum paid-up capital was removed. Capital should be set against what the business actually needs, because it is the amount the parent remits and reports under FEMA, and reducing capital afterwards is a court-supervised process rather than a filing.
A subsidiary suits an operating presence, because liability is ring-fenced, activity is unrestricted within the sector and the domestic tax rate is materially lower. A branch office suits work that is an extension of the parent’s existing contracts and where profits will be remitted rather than reinvested.
Yes. Documents executed in a country party to the Hague Apostille Convention are notarised and then apostilled. Documents from a non-Convention country are notarised, legalised by the foreign ministry and then attested by the Indian mission. Non-English documents need an authenticated translation.
Principally by dividend, subject to withholding at the domestic rate or a lower treaty rate where a tax residency certificate, Form 10F and a no permanent establishment declaration support the claim. Service fees and royalties are also used, but must be at arm’s length and certified in Form 3CEB.
Yes. A resident employee or director may acquire shares of the foreign parent under a stock option plan offered globally on a uniform basis. Where that condition is met, the acquisition is not constrained by the ordinary remittance ceiling, and reporting runs half-yearly through the Indian entity.
Yes. The Digital Personal Data Protection Act, 2023 became operational when its rules were notified in November 2025. Cross-border transfer is currently permitted except to countries the government restricts, and entities notified as Significant Data Fiduciaries face annual algorithmic audits and a resident Data Protection Officer.

Get Started

Start with a structuring call

Bring the sector, the parent jurisdiction, the expected first-year headcount and whether profits will stay in India. Those four inputs settle the entry route in most cases, and the call is where the timeline and the cost range stop being generic.

Response within one working day. Initial structuring view at no cost.