Subsidiary Company Registration in India
We’ll get your company registered, set up the payroll, accounting and tax filing, and help open a bank account online — no need to go anywhere
Requirements and facts about company registration in India
India’s company registration process is guided by the Companies Act, 2013. This act lays out the full details of what’s required pre-incorporation, post-incorporation and other details. Below are few important requirements. Let’s take a proper look at the different essential bits.
Company Name
Your new business needs a name. Your name can’t be the similar as another existing business’s name or trademark. There are many restrictions on name registration unlike other countries
Shareholders
The parent company can be a 100% shareholder or any 2 foreign nationals can be the shareholder. Its not necessary to have a Indian resident as shareholder
Sharecapital
Unlike other countries there is no requirement of minimum capital in India. We suggest companies to keep a capital of atleast USD 5000
Directors
Minimum 2 directors are mandatory. On that atleast 1 director should be a Indian resident. We can provide you with nominee directorship services
Registered Address
A Registered address is the address of your company. It’s what goes into India’s official government records. Under the Company Ordinance, every company must have a registered address in India. We can provide you with virtual office address.
Annual General Meeting
According to the Companies Ordinance, every company in India must hold at least one general meeting per year. It should also hold 2 board meetings.
Company Secretary
It’s mandatory to file 3 secretarial returns every year. They are filed by company secretary and we assist you with the same. A statutory auditor is also appointed
Tax
The professional fees including government fees for company registration is USD 1400. Once you are incorporated you have to pay tax on profit @ 25.36%. Also GST is applicable on domestic sales. GST returns are monthly and 1 annual tax return.
Annual Complinces
India is a bit unusual when it comes to compliances. Statutory Audit is mandatory even for smallest of the companies. A statutory auditor needs to be appointed and an annual filing every year is mandatory.
Steps, documents and all the details about registering a subsidiary in India
The basic requirements to register a subsidiary company in India is as follows:
Minimum 2 Directors and of them 1 should be resident Indian (residing in India). Its not necessary that the Indian director holds any shares in the company. The director can be a name sake director without any authority.
We do provide directorship services. Our director also gives you a signed resignation letter without any date so that you can replace him any time without a need of any action from his side.
Minimum 2 Shareholders The parent company can hold 99.99% shares and 1 shares can be held by any person or company whether Indian or not.
Office address in India. If you have not short listed the office space yet you can register the company at any virtual office. We do provide this service. You can change your registered office any time within a day.
Documents Required to be submitted by a Foreign company for registration
Parent Company(should be notarized and appostiled)
- Certificate of incorporation (should have name and address)
Representative and individual shareholder ( should be notarized and appsotiled)
- Passport
- Utility bill (bank statement/electricity bill/mobile bill/gas bill – anyone)
Other documents which we will prepare and send ( should be notarised and apostilled)
- Board resolution
- Affidavits and declaration from the shareholder and directors)
Indian Director
- Pan Car
- Aadhar Card
- Utility bill (bank statement/electricity bill/mobile bill/gas bill – anyone)
Proposed registered office in India
- Electricity bill
Steps to register a subsidiary company online in India:
It usually takes 2 weeks to complete the process
The steps to register a company are:
- Â Name Approval – We apply for the desired name of the company through Government portal. Generally the parent company name with the word India in it is approved. For example if the name of the foreign entity is Apple Inc. the name Apple India Private Limited will be approved easily. That said you can apply any other name.
- Application for Digital signatures of Directors – We apply for the digital signature of Directors so that we can submit the form electronically.
- Preparation of charter of the company – The mOA and AOA are standard formats provided by the government. We just change the name and the object of the company and send it for your approval.
- Notarisation and Appostilisation of the documents – You should after the name is approves notarise and appsotile the documents mentioned by us and send us the scanned copies.
- Filing of forms with the government portal – We then upload the forms. Its usually takes 3-4 days for the approval.
- Issue of certificate of registration – Once approved the government issues the TAX ID that is Pan and certificate of registration electonically
Advantages of registering a Subsidiary company in India
A foreign company or a foreign national can register 3 type of companies in India. A Private Limited Company, Limited Liability Partnership or a Branch Office. But the most suitable and most used structure to setup a subsidiary is vis Private Limited Company.
The advantages of registering the Private limited company is as follows:
- The tax rate for the Private Limited company is lowest. It is 25% on profits
- Employees prefer to work for a Private Limited Company rather than a LLP or Branch office as Private Limited Company is more credible
- Its easy to transfer the shares of a Pvt Ltd company
Bank Account opening process for a foreign company in India
The Bank account of the Indian company must be opened within 30 days of incorporation. We suggest to open the account in the international banks like HSBC or DBS as the service is better. bank account can be opened remotely and you do not need to visit India. It usually takes 2-3 weeks to open the bank account in India.
All banks provide you with the internet banking option so that you can operate the bank account from anywhere.
After the bank account is opened the shareholders need to deposit the share capital in this bank account.
Hiring employees and payroll process in India
You can start hiring employees s soon as your bank account is open. We assist you with the employment contract as per the Indian laws. We also provide you with the online payroll system.
Withholding Taxes on employees salary – The company when paying a employee needs to deduct the tax and pay it to the government. The withholding tax amount depends on the salary amount and the investments made.
Medical insurance for employees – Its not mandatory but we suggest to do that. A insurance policy which covers the employee and his family is a great tool to attract and retain employees.
Other retirement benefits for the employees – Only provident fund needs to be provided to the employees. Its Rs 1800 (USD 30) per month.
Leaves – As per the labour law the employees are eligible for 18 paid leaves in a year and 9 medical leaves.
Women are eligible for a paid maternity leave of upto 26 weeks.
Apart from leaves there are 10 public holidays.
Termination of the employee – The company can terminate the employee by giving minimum 1 month notice or paying him 1 month salary.
Withholding Tax returns – these returns have to be filed every quarter
GST/VAT returns – these have to be filed every month. There is no GST on export of services. The GST rate is 18%
Income tax returns for the company – this has be filed every year. The income tax rate is 25.6% on profits
We assist you with all the tax compliances applicable to your company.
Post incorporation compliance and management of the subsidiary company
Book Keeping
We assist you with book keeping in accounting systems like Zoho books or Quickbooks. You have a dedicated accountant who will send you the monthly financial statements.
Audit and secretarial compliances
Its mandatory for every company to submit the financial statement to the government. the financial statement should be audited by the chartered accountant. Our CAs will assist you with this service.