India

Company Formation in India

India

Formation Time

2–3 weeks

Min. Capital

No minimum (INR 1 lakh authorized capital standard)

Corporate Tax

25.17% (turnover ≤INR 400 Cr)

Foreign Ownership

100%

Overview

India is the world's fifth-largest economy and the fastest-growing major economy, with a GDP exceeding USD 3.5 trillion and a population of 1.4 billion. The Private Limited Company (Pvt Ltd) is the preferred vehicle for foreign investment, offering limited liability, easy equity transfer, and full foreign ownership in most sectors via the automatic route under India's FDI policy. Registration is handled through the Ministry of Corporate Affairs (MCA) and the Registrar of Companies (ROC), with the SPICe+ portal streamlining the process. Companies must obtain a PAN (Permanent Account Number) and TAN (Tax Deduction and Collection Account Number). The corporate tax rate for companies with turnover up to INR 400 crore is 25.17% (inclusive of surcharge and cess), and a concessional rate of 17.16% is available for new manufacturing companies under Section 115BAB. India's 95+ DTAA treaties, massive consumer base, world-class IT talent, and improving ease of doing business make it an essential market for global expansion.

1.4B market

100% FDI automatic route

25.17% effective tax

95+ DTAA treaties

IT/tech talent hub

Why Choose India

World's fastest-growing major economy — 1.4 billion consumers

100% FDI allowed in most sectors via automatic route

25.17% effective tax rate (turnover ≤INR 400 Cr); 17.16% for new manufacturing

95+ Double Tax Avoidance Agreements (DTAA)

SPICe+ portal enables end-to-end digital incorporation

Massive English-speaking, tech-savvy talent pool

Robust startup ecosystem — India is the world's 3rd largest startup hub

Special Economic Zones (SEZs) with tax holidays and incentives

Business Entity Types

Entity	Ownership	Directors	Capital	Tax	Best For
Private Limited Company (Pvt Ltd)	100% (automatic route in most sectors)	2 (at least 1 must be Indian resident)	No statutory minimum (INR 1 lakh authorized capital typical)	25.17% (turnover ≤INR 400 Cr); 30.6% otherwise. New manufacturing: 17.16%	Most foreign businesses — tech, services, trading, manufacturing
Limited Liability Partnership (LLP)	100% FDI allowed via automatic route (with conditions)	2 designated partners (1 Indian resident)	No minimum	30% flat + surcharge and cess; no dividend distribution tax	Professional services, consulting, small businesses
Branch Office / Liaison Office	100% (extension of foreign parent)	1 authorised representative	None (RBI approval required)	Branch: 40% + surcharge/cess. Liaison: no commercial activity.	Branch: existing business extension. Liaison: market exploration.
One Person Company (OPC)	Not available to foreign nationals (Indian residents only)	1 (Indian resident)	No minimum	25.17% / 30.6% depending on turnover	Solo Indian entrepreneurs only
Wholly Owned Subsidiary	100%	2 (1 Indian resident)	No minimum	Same as Pvt Ltd rates	Multinational subsidiaries, captive centres, back-office operations

Step-by-Step Formation Process

DIN & DSC Application

2–3 days

Obtain Director Identification Numbers (DIN) and Digital Signature Certificates (DSC) for all proposed directors.

Name Reservation (RUN)

1–2 days

Reserve company name through MCA's Reserve Unique Name (RUN) service.

SPICe+ Filing

3–5 business days

File incorporation application via SPICe+ portal, which simultaneously applies for PAN, TAN, EPFO, ESIC, and professional tax registration.

Certificate of Incorporation

Included in Step 3

MCA/ROC issues Certificate of Incorporation with PAN and TAN.

GST Registration

3–7 business days

Bank Account Opening

1–2 weeks

Open a corporate bank account with an Indian bank using the Certificate of Incorporation, PAN, and board resolution.

Costs & Fees

Government / License Fee	INR 7,000+
Our Service Fee	USD 2,500+
Annual Renewal	USD 1,500+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

India has a large and diverse banking sector. Private banks (HDFC, ICICI, Kotak) generally offer faster onboarding and better digital services. Foreign banks (HSBC, Standard Chartered) are preferred by multinationals.

Account Opening Time

1–2 weeks

Multi-Currency

Yes — multiple currencies supported

Recommended Banks

HDFC BankICICI BankKotak Mahindra BankState Bank of India (SBI)HSBC IndiaStandard Chartered India

Tax Overview

Corporate Tax

25.17% effective (22% + 10% surcharge + 4% cess) for turnover ≤INR 400 Cr; 17.16% for new manufacturing (Section 115BAB); 30.6% for others

Personal Income Tax

5% (INR 3–6 lakh) to 30% (over INR 15 lakh) + surcharge + 4% cess. New tax regime default from 2023.

VAT / Sales Tax

GST: 5%, 12%, 18%, or 28% depending on category (18% standard for services)

Capital Gains Tax

Short-term: 15–20%; Long-term: 12.5% (listed equities over INR 1.25 lakh), 20% (other assets with indexation)

Withholding Tax

Dividends: 20% (reduced by DTAA); Interest: 20% (5% on certain bonds); Royalties/FTS: 20%

Double Tax Treaties

95 countries

Startup India scheme provides 3-year tax holiday for eligible startups. SEZ units enjoy 100% tax exemption for first 5 years, 50% for next 5. Transfer pricing regulations strictly enforced.

Visa & Residency

Business Visa

1–5 years (multiple entry)

For business activities — meetings, conferences, establishing ventures. Does not permit direct employment.

Employment Visa

1–5 years

For foreign nationals employed in India at salary exceeding USD 25,000 per annum.

Startup India Visa

1 year, renewable

For founders of DPIIT-recognised startups.

Investor Visa

Up to 5 years

For foreign nationals investing in India.

Family visa: AvailableProcessing: 2–8 weeks

Frequently Asked Questions

Can a 100% foreign-owned company be set up in India?

Yes. Under India's FDI policy, 100% foreign ownership is permitted in most sectors under the automatic route. Sectors like defence (74% automatic, 100% government route), media, and multi-brand retail have specific caps.

What is the SPICe+ process?

SPICe+ is the MCA's integrated incorporation portal. A single form handles: name reservation, incorporation, DIN allotment, PAN/TAN issuance, EPFO/ESIC registration, GST provisional registration, and professional tax registration.

Do I need an Indian-resident director?

Yes. Every Pvt Ltd must have at least one director who has resided in India for 182+ days in the preceding financial year. We provide nominee director services.

What is the effective corporate tax rate?

For turnover up to INR 400 crore: 25.17% (22% + 10% surcharge + 4% cess). New manufacturing companies: 17.16% (15% base + 10% surcharge + 4% cess).

How does GST work in India?

India's GST has rates of 5%, 12%, 18%, and 28%. Most services are at 18%. Registration is mandatory when turnover exceeds INR 40 lakh (INR 20 lakh for services). Monthly returns (GSTR-1, GSTR-3B) and annual return (GSTR-9) required.

What about repatriating profits out of India?

Profits can be repatriated via dividends under the automatic FDI route without RBI approval. Withholding tax on dividends to non-residents is 20% (reduced under treaties — e.g., 10% under India-Singapore DTAA).