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COMPANY IN INDIA
FOR FOREIGN NATIONALS
COMPANY IN INDIA FOR FOREIGN NATIONALS
India as one of the fastest growing economies & attractive business place for foreigner, India receives plenty of Foreign Direct Investment (FDI) and Private Equity capital.
India continues to be an attractive destination for investment amongst Foreign Companies and Foreign Nationals.
There are majorly two types of entry strategies for foreign businesses in India:
Registration of a Private Company or
Establishing a branch/liaison office in India.
Registration of a Private Company is considered to be the easiest and fastest way of entry in India for foreign nationals and also for foreign companies. The foreign direct investment which ranges up to 100% in a private limited company happen under the automatic route and in such case no special permission is required from the Central Government in India.
Secondly, one can opt to register branch office, project office or liaison office which necessarily requires
RBI and/or Government approval. Therefore, the cost and the time which is required for the registration of
a branch office, project office or liaison office is certainly higher than the time and cost attached to the
incorporation of a private limited company.
KEYPOINT OF REGISTRATION OF COMPANY IN INDIA BY FOREIGN NATIONALS
MINIMUM TWO DIRECTORS
Company should have at least two directors (individuals) and one of the Director of the Company must be an Indian Citizen and also an Indian Resident.
MINIMUM TWO MEMBERS
Company should have a minimum of two shareholders (can be individuals or even corporate entities).
There is no such rule of minimum shareholding of the Indian Director. So, the foreign nationals or entities can hold 100% of the shares.
EASY FOREIGN DIRECT INVESTMENT (FDI) THROUGH AUTOMATIC ROUTE
FDI in India is allowed through Automatic Route in majority of sector, wherein no prior approval of RBI is required only few compliances are required to be done after receipt of FDI.
REGISTERED OFFICE ADDRESS IN INDIA
It is mandatory to have an address in India which can be served as the registered office address of the company. Most of the foreign companies’ setup their registered offices in the metro cities in India like Mumbai, Delhi, Bangalore, Chennai, Hyderabad etc.
REGISTRATION WITH UNIQUE NAME
Registration of Private Limited Company with Central Government (Ministry of Corporate Affairs) with unique name not be same or similar to the name of any existing company or a trademark.
TAX BENEFITS
A Private Limited Company registered under Companies Act 2013 & having turnover up to 250 Crore are taxed @ 25% Per Annum, whereas Partnership, LLP are taxed @ 30 %. The Proprietor are taxed as per slab rate, Proprietors have income above 10 Lakhs are taxed at 30%.
A director can receive remuneration, you can rent your property to company can receive rent, as a creditor you can lend money to your own company and earn interest. Directors’ remuneration, rent and interest are deductible expenses which reduces the profitability of the Company and ultimately brings down taxable income of your business.
DISTRIBUTION OF INCOME @ 100%
Company can pay salary to directors @ 100% of net profit.
Partnership & LLP can pay
On first 3 Lakh of Book profit or loss- 1,50,000 or 90% whichever is more.
On Balance- at 60%
On balance approx. 40% of net profit Partnership & LLP has to pay tax @ 30 % plus Education Cess.
EASY LOAN
Better borrowing capacity from banks and public, Banks & financial institute provide funds to company rather than to individual proprietary concern or partnership firm.
PERPETUAL EXISTENCE
Separate Legal Perpetual Existence of Business, doesn’t get affected by death of member or director.
LIMITED LIABILITY OF MEMBERS
Limited liability of members in company debts.
In a case of default, banks/creditors can only sell company’s assets but not personal assets of directors.
CHANGES IN MANAGEMENT IS EASY
Changes in the Board of management of a Private Limited Company can easily and swiftly be made just through filing some simple forms with ROC.
BETTER CREDIBILITY & INCREASE IN VALUATION
The Private Limited Companies offer greater creditability than that provided by unregistered proprietorship or partnership or LLP.
Gradually increase in valuation of your business venture, as your business progress.
EASY TRANSFER OF SHARES
The ownership of a private limited company is determined by the shareholding of the Company.
The Share can be easily transferred with the consent of transferor, transferee & Board.
A private limited company is considered to be a “closed corporation” of members. Therefore, the share transfer in a Private Limited Company can be restricted by the Articles of Association (AOA).
COMPANY CAN HOLD PROPERTY
Company can hold residential or commercial property in its own name. The Company can enter into transactions in its own name.
ANNUAL COMPLIANCES
The Private Limited Company requires to get their financial Statement (Balance Sheet & Profit & Loss Account) audited every year & file Annual Return & Audit Financial Report to Registrar of Companies (ROC).
The Company requires to hold Board & Annual General Meeting at regular interval.
DOCUMENTS FOR REGISTRATION OF PRIVATE LIMITED COMPANY FOR FOREIGN NATIONAL
DOCUMENTS OF FOREIGN DIRECTORS/MEMBERS
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Passport size photo.
Copy of Passport.
Indian Visa (if present in India).
Bank Statement (not more than 2 months old) as address proof.
All the above documents shall be in English & notarized by a Notary Public in the home country or by the Indian Embassy in the respective country.
DOCUMENTS OF INDIAN DIRECTORS/MEMBERS
Passport size photo.
PAN Card.
Aadhar Card or Passport or Voter Id or Driving License (Any two).
Copy of Bank Passbook, Bank Statement, Mobile Bill or Telephone Bill (not more than 2 months old).
DOCUMENTS OF REGISTERED OFFICE ADDRESS
Electricity or Phone Bill or Mobile Bill of office address.
Landlord NOC (Format will be provided).
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OUR PACKAGE
ALL INCLUSIVE PACKAGE INCLUDES
Digital Signature Certification of 2 Director.
DIN of 2 Directors.
Unique Name Search & Approval.
Authorized Share Capital of upto 10 Lakhs.
Incorporation Certificate, MOA & AOA.
PAN Number & TAN Number.
Bank Account Opening Documents.
PF & ESIC Registration
Professional Tax Registration
Government Fees.
Stamp Duty.
Professional Fees.
Advise from Expert.