How to Register a Subsidiary Company in Bangalore in 2026 — Step-by-Step
In Short
A foreign company can register a private limited subsidiary in Bangalore fully remotely — no India visit. Incorporation takes 10–15 working days after your apostilled documents arrive, and first-year setup runs $1,700–2,100 (excluding share capital). Profits are taxed at about 25%, far below the ~35% a branch office pays.
This guide is for founders and finance teams at companies outside India — most often US and UK firms — who want a wholly-owned Indian arm in Bangalore to run an engineering team, a back office, or local sales.
It walks through the exact structure, cost, timeline and compliance for a Bangalore subsidiary in 2026, with the real numbers we use on live setups.
One thing surprises almost everyone: you never have to set foot in India. The whole process — signing, filing, even opening the bank account — happens online from wherever you are.
What is a subsidiary company in Bangalore?
A subsidiary in Bangalore is a private limited company incorporated in India whose shares are owned by your foreign parent company or its founders.
It is a separate Indian legal entity. It signs its own contracts, employs its own staff, pays its own Indian tax, and shields the parent from local liability.
For a tech back office, a trading arm, or a team you want to hire and pay properly, the private limited subsidiary is the structure foreign founders use. The alternatives — LLP, branch office, liaison office — fit narrow cases, which the table below makes clear.
| Structure | Best for | Why founders skip it |
|---|---|---|
| Private Limited (subsidiary) | IT/engineering, trading, hiring, local sales | — this is the default choice |
| LLP | Professional services partnerships | Staff prefer working for a Pvt Ltd; harder to raise capital |
| Branch office | Banks and a few regulated firms | Taxed as a foreign company at ~35% |
| Liaison office | Airlines, shipping representation | Cannot earn revenue in India |
What do you need to register a subsidiary in Bangalore?
You need at least 2 directors (one resident in India), at least 2 shareholders, a registered Bangalore address, and apostilled identity documents.
Here is each requirement in plain terms:
- 2 directors minimum — at least one must be an Indian resident, meaning a person who stayed in India 182 days or more in the previous financial year. You need not give this director any shares; many founders use a nominee until they hire locally.
- 2 shareholders minimum — these can be foreign individuals, your foreign parent company, or a mix. In most sectors, 100% foreign ownership is allowed under the automatic route, so no government approval is needed first.
- A registered Bangalore address — required for incorporation, but it can be a virtual office. A Bangalore virtual office starts at about $50/month.
- DSC (Digital Signature Certificate — India's legally binding electronic signature) for each director, used to sign all the forms.
- Apostilled documents — passports and address proofs notarised and apostilled in your home country (or consularised if your country is not part of the Hague Apostille Convention).
How do you register a subsidiary in Bangalore step by step?
Once your apostilled documents reach us, the company is incorporated in 10–15 working days through seven online steps.
Here is the sequence we run on every setup:
- Reserve the name (2–3 days). We file two name options on the MCA (Ministry of Corporate Affairs) portal — more on why two below.
- Get DSCs for directors (2 days). Each director receives a Digital Signature Certificate.
- Notarise and apostille your documents (about 7 days, in your country). This is the step you control, and the one that most often adds delay.
- File SPICe+ (3 days). We submit the incorporation forms with your MOA and AOA (the company's charter documents) and your parent's board resolution.
- Receive the Certificate of Incorporation (5 days). The MCA issues it along with your PAN and TAN (tax registration numbers).
- Open the bank account (1–3 weeks). A global bank such as HSBC or DBS opens it remotely, with online banking.
- Register for GST, Professional Tax and Shops Act (about 7 days). The local registrations that make you operational in Karnataka.
An interactive version of this checklist sits further down — tick each step off as you go.
What does it cost to set up a subsidiary in Bangalore?
First-year setup runs $1,750–2,450, plus your paid-up share capital of around ₹1 lakh ($1,200), which stays inside your own company.
The setup figure is one-off. The share capital is not a fee — it is your money, parked in your company's account.
| Setup item | Cost (USD) | Note |
|---|---|---|
| Name approval, DSC, DIN | Included | Bundled in the all-in package |
| Incorporation: SPICe+, MOA/AOA, Karnataka stamp duty, PAN/TAN | $1,700 all-in | Fixed, includes all govt. fees |
| Notarisation & apostille (in your country) | $100–400 | Varies widely by country/state |
| Virtual office, Bangalore (year 1) | ~$600 | From $50/month |
| First-year setup total | $1,700–2,100 | Excludes share capital |
After setup, your monthly running cost depends on team size and transaction volume:
| Ongoing service | Cost (USD / month) |
|---|---|
| Bookkeeping + GST filing | $150–400 |
| Payroll (scales with team) | $50–150 |
| Statutory audit (spread over the year) | $80–200 |
| ROC annual filings (spread over the year) | $40–80 |
| Virtual office | ~$50 |
| Typical monthly total | $370–880 |
See our full India subsidiary pricing page for a line-by-line breakdown.
What tax does a Bangalore subsidiary pay?
A subsidiary is an Indian domestic company, so profits are taxed at about 25.17% under Section 115BAA — well below the ~35% base rate a branch office pays.
This single difference is why foreign founders pick a subsidiary over a branch. The branch is treated as a foreign company; the subsidiary gets domestic-company rates.
| Structure / regime | Base rate | Effective (with surcharge + cess) | Best for |
|---|---|---|---|
| Subsidiary — Section 115BAA | 22% | ~25.17% | Most profitable subsidiaries |
| Subsidiary — normal regime (turnover ≤ ₹400 cr) | 25% | ~26–29% | Default before opting in |
| Branch office (foreign company) | 35% | ~36–38% | Banks only |
| Captive back office (cost-plus 15.5%) | tax on 15.5% margin | ~3.9% of operating cost | Service captives billing the parent |
If your Bangalore team only serves your parent company — a captive engineering or support unit — you do not show a normal profit. Instead, under India's transfer pricing rules, you add a markup to your costs and pay tax on that margin. We cover the 2026 change to this markup in the insider section below, because it just dropped.
What happens after the company is registered?
Once incorporated, you open the bank account, hire staff, and start a fixed set of monthly and annual filings.
Banking: opened remotely, usually 1–3 weeks after the Certificate of Incorporation, through a global bank with online access.
Hiring: you can hire the moment the account is active. Indian labour rules that matter in Karnataka: 26 weeks of paid maternity leave, around 18 days of paid leave a year, and mandatory transport for women employees working past 8:30 PM. See our labour laws guide for the rest.
Compliance: a statutory audit every year regardless of turnover, monthly or quarterly GST, an annual income tax return, and ROC filings (AOC-4 for financials, MGT-7 for the annual return). Directors file DIR-3 KYC annually. Our subsidiary compliance guide lists every due date.
What the official guides don't tell you
Five things we only learned from running these setups in Bangalore — none of them appear on the MCA portal or in the standard checklists.
1. The transfer-pricing markup just dropped to 15.5%
For years, captive units in Bangalore had to add a 17–24% markup on costs to satisfy the safe-harbour rules. From 1 April 2026, the government consolidated IT, ITeS, KPO and software R&D into one category with a single 15.5% cost-plus margin, and lifted the eligibility ceiling to ₹2,000 crore of related-party revenue. For a captive billing only its parent, that pushes the effective India tax bill down to roughly 3.9% of operating costs. Most providers are still quoting the old range.
2. Bangalore needs two registrations people forget
Beyond GST, Karnataka requires Professional Tax registration (both employer and employee) and a Shops & Commercial Establishments Act registration for your office — even a virtual one. Founders who skip these get caught at the first payroll cycle, not at incorporation, when it is more disruptive to fix.
3. File two names, not one
The single most common cause of a slipped timeline is a rejected name — and it is almost never a trademark clash. It is a generic or descriptive name, or one that resembles an existing company. A rejection costs you another fee and 2–3 days. Filing two options at once removes that risk entirely.
4. The apostille is your bottleneck, not India
Indian incorporation is fast and predictable. The delay almost always sits in your home country: apostille turnaround varies from 3–4 days in some US states to 2–3 weeks in others. Start the apostille before name approval, not after.
5. The women's night-transport rule has teeth in Karnataka
If anyone on your team — especially a support or operations function — works past 8:30 PM, Karnataka law makes safe transport for women employees mandatory, not optional. It is a real budget line for night-shift teams that US founders rarely see coming.
A real Bangalore setup: a US SaaS engineering team
Illustrative client example — details anonymised.
Who: A US-based SaaS company, ~40 staff, opening a Bangalore engineering captive of 8 developers to own product work and IP locally.
What they needed: a wholly-owned subsidiary to put engineers on proper Indian payroll, hold the code under the parent, and run as a cost-plus captive.
What happened: Name approval and DSCs were done in 4 days. The one delay was theirs — the apostille in their state took 12 days instead of the 4 they expected, pushing the timeline out by a week. Once documents arrived, incorporation closed in 11 working days. The bank account opened remotely 9 days later.
Outcome: live entity in under 4 weeks end to end, running on the 15.5% cost-plus margin, with a Bangalore virtual office and full monthly compliance.
Your Bangalore subsidiary checklist
Tick each step as you complete it. Seven steps, start to operational.
Frequently asked questions
How long does it take to register a subsidiary company in Bangalore?
Once your apostilled documents reach us, incorporation takes 10–15 working days. End to end, including notarisation and apostille in your home country, plan for 3–4 weeks. Name approval alone takes 2–3 working days.
Do I need to visit India to register a company in Bangalore?
No. The entire process is online. You sign documents remotely using a Digital Signature Certificate, and even the bank account is opened without a visit.
How much does it cost to set up a subsidiary in Bangalore?
The incorporation package is $1,700 all-inclusive, covering company registration, government fees, PAN, TAN, GST, PF registration and bank account support. Adding a first-year virtual office (~$600) brings the total to $1,700–2,100. This excludes your paid-up share capital (about ₹1 lakh, or $1,200), which stays inside your own company.
Do I need an Indian resident director for a Bangalore subsidiary?
Yes. At least one of the minimum two directors must have stayed in India for 182 days or more in the previous financial year. You do not have to give this director any shares.
Can a foreign company own 100% of an Indian subsidiary?
Yes, in most sectors, under the automatic route, meaning no prior government approval is needed. A few sectors such as defence, multi-brand retail and insurance have caps or conditions.
What taxes does a Bangalore subsidiary pay?
Profits are taxed at about 25.17% under Section 115BAA, or 25% base under the normal regime for turnover up to ₹400 crore. A captive back office billing only its parent is taxed on a 15.5% cost-plus margin under the 2026 safe-harbour rules.
Is a physical office required to register a company in Bangalore?
A registered address is required, but it can be a virtual office starting around $50 per month, which satisfies the requirement for incorporation, GST and your Certificate of Incorporation.
What is the difference between a subsidiary and a branch office in India?
A subsidiary is a separate Indian company taxed at about 25%; a branch office is treated as a foreign company and taxed at roughly 35% base. Most foreign founders choose a subsidiary; branches are used mainly by banks.
How do I open a bank account for a Bangalore subsidiary remotely?
After incorporation we introduce you to a banker, usually a global bank such as HSBC or DBS. The account is opened online with no India visit, typically 1–3 weeks after your Certificate of Incorporation.
What ongoing compliance does a Bangalore subsidiary have?
Monthly or quarterly GST, an annual statutory audit regardless of turnover, an annual income tax return, and ROC filings (AOC-4 and MGT-7). Directors complete DIR-3 KYC each year. Budget for $370–880 per month depending on volume.
Why is my company name application rejected in Bangalore?
The most common reason is a generic or descriptive name, not a trademark clash. Names resembling an existing company or containing restricted words also get rejected. File two name options at once to avoid losing 2–3 days.
Do I need GST registration for a Bangalore subsidiary?
GST is mandatory once turnover crosses ₹20 lakh for services or ₹40 lakh for goods, but a subsidiary exporting services to its parent should register from day one and file a Letter of Undertaking so exports are zero-rated.
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