Indian Subsidiary Company Registration for Foreigners
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Introduction of Indian Subsidiary Setup
Many foreign companies wish to start their operations in India and capture a rapidly growing market. The Companies Act 2013, provides a mechanism by which foreign companies can open companies in India, under the FDI Policy by investing in equity. These companies are called the Indian Subsidiary Company.
An Indian Subsidiary Company is a Company that may be incorporated under the Companies Act, 2013 which is controlled (over 50%) or owned by another Company which is a Parent Company incorporated abroad.
The company subsidiary is called a sister company and the controlling company is called a parent company or holding company. The parent company has the right to control the subsidiary partly or wholly.
The Companies Act 2013 regulates the registration process for the Indian Subsidiary Company. According to the Companies Act of 2013, a subsidiary company may be defined as a company in which the foreign business body or parent body has a minimum of 50% of the total share capital. The parent company participates in the subsidiary. The company under which it operates is required to comply with the national laws it plans to establish or has already established. Therefore, if a subsidiary company is established in India the company must follow the law applicable in India.
Features of Indian Subsidiary Companies
Prior authorization is not required for return benefits.
Indian subsidiary companies follow the Indian transfer price framework.
The union's 2020 budget says taxes on dividend distribution are non-existent.
Advantages of Indian Subsidiary Company Registration
Distinct legal identity
Once a business is registered it is born legally which means it is separated from its owners, Directors, Managers, shareholders, and employees, etc. The dissolution of a Parent Company does not affect the life of the Company under it.
Limited Liability
Members' debt is limited by the amount they have invested in the Company and therefore, they are not liable in any way and are a legal entity which means that they are different from their Members and directors.
No minimum capital needed
To consolidate a Foreign Company no minimum capital is required and the capital structure can be adjusted according to the Company's growth requirements over time.
Increased security
Employees prefer to join the Private Limited Company and retailers feel safer in providing credit, confidence, and trust of customers grows which leads to increased investment from investors.
Easy access to funds
The scope of growth is high due to the easy availability of funds from venture capitalists, financial institutions, angelic investors who provide more transparency.
Increased FDI
Attract Foreign Direct Investment in India following the guidelines issued to the government with or without the approval and consideration of the sector limit.
Minimum requirements
Two Directors required as minimum and fifteen as maximum
Minimum of two shareholders
At least one Director will be an Indian citizen
Digital Signatures for Subscribers and Directors
The parent company must own more than 50% of the shares.
Director Identification number if available
Checklist of Documents Required
PAN Card
Member and directors of the Company proposed Passport in case of foreign nationals
Proof of the identity
of the Member and directors of the proposed Company; (Driver's License/Voter ID/Passport/Aadhar)
Address Proof
of Members and Directors (Service Bill/Telephone Bill/ Mobile Bill/Bank statement not exceeding two months)
Recent passport size photograph of the Members and Directors
Proof of Business Address Location of owned property
(Copy of Registry and Recent Electricity or Water Bill)
Proof of Business Address Leased/rented
Lease Agreement, NOC from Owner, Recent Government Electricity Bill or Water Bill)
Note: - In the event of an NRI or Foreign nationals documents of Directors and Subscribers shall be in writing or sent by an apostle.
Documents Required for Completing FCGPR
PAN card of persons to be designated as Authorized persons on behalf of the business
Board resolution of the organization to authorize any person
Foreign Inward Remittance Certificate (FIRC)
KYC for the individual residents outside India
Copy of FIPB permit (if applicable)
Copy of Board Resolution on securities
Process for Indian Subsidiary Company Registration for Foreigners
Complete the Application Form
Processing Documents
DSC application
Availability of Name
Company incorporation e-filing
Obtain an Incorporation Certificate
FCGPR filing
Annual compliances
Companies Act, 2013
Income Tax Act, 1961
Guidelines of FEMA
MCA Guidelines
Annual return with Registrar of Company
Filing with RBI
Income Tax Return
Filing with SEBI
How Paravue Advisors help you to achieve your dream startup?
We at Paravue Advisors guarantee a high level of satisfaction and timely delivery of your firm registration with better response to government needs through our professionals. You can contact our team on 099504-51000 or send an email to infoparavueadvisors@gmail.com for Indian Subsidiary Company Registration for Foreigners.
Why you should choose Paravue Advisors for your assistance?
Expertise guidance
We will help you from picking up a suitable registration to getting your registration certificate. Our experts give you expert guidance on many of the processes involved in registering your business as a sole proprietorship, as well as service tax registration, sales tax, import/export code, and professional tax.
Filing Application
The professionals to assist you in the application are well-executed and can manage native registrations.
Registration Receipt
Our team will provide full assistance with the registration process. This can vary between 5 and 15 days, depending on the work done by the authorities involved.
FAQs on Indian Subsidiary Setup