Foreign Subsidiary
Setup Cost Estimator
WOS · Branch · Liaison · Project Office in India

A Wholly Owned Subsidiary (Private Limited Company) in India can be incorporated in 15–30 working days from the time all documents are in order. The bottleneck is typically obtaining apostilled/notarised documents from the parent country — this takes 5–15 days depending on the country. Timeline: Document preparation (5–15 days) → Name reservation (1–3 days) → DSC for foreign director (3–5 days) → SPICe+ filing → MCA processing (5–10 days) → Certificate of Incorporation received. FC-GPR filing with RBI must happen within 30 days of share allotment. TAXAJ typically completes the full process including FC-GPR within 6–8 weeks of engagement.

An apostille is an international certification under the Hague Convention (1961) that authenticates a document issued in one country for use in another. For Indian company incorporation, the foreign parent company's charter documents (Certificate of Incorporation, MOA) and the foreign director's passport must be notarised by a local Notary Public and then apostilled by the competent authority of that country. India is a member of the Hague Convention — apostilled documents are accepted directly. For countries not in the Hague Convention: documents must be notarised + attested by the Indian Embassy/Consulate in that country. TAXAJ guides clients through the exact document requirements for each country.

Most sectors in India allow 100% FDI under the automatic route — no prior government approval needed. Sectors with restrictions: Multi-brand retail trading: 51% FDI, government approval. Defence and aerospace: Auto route up to 74%, beyond that government approval. Banking (private sector): Auto route up to 49%. Insurance: Auto route up to 74%. Print media: 26% FDI. Broadcasting: Varies. Prohibited sectors: Lottery, gambling, chit funds, Nidhi companies, real estate agents, atomic energy. Pakistan/Bangladesh investors: Require prior government security clearance for ALL sectors. Always verify the latest FDI policy at dpiit.gov.in before proceeding.

Annual compliances for a WOS are the same as any Indian Pvt Ltd, plus additional FEMA requirements: Companies Act: AOC-4 (financial statements), MGT-7 (annual return), ADT-1 (auditor), DIR-3 KYC for all directors, MSME-1 if applicable. Income Tax: ITR-6 by October 31 (transfer pricing cases), Form 3CEB (if TP applicable). GST: Monthly/quarterly GSTR-3B and GSTR-1 if registered. FEMA: FLA Return by July 15 annually, FC-TRS for any share transfers, FCTRS for capital account transactions. Estimated annual compliance cost: ₹1.5 lakh – ₹4 lakh depending on size and number of international transactions.

GST registration is mandatory for a foreign subsidiary if: (1) Annual turnover exceeds ₹40 lakh (goods) or ₹20 lakh (services), (2) The subsidiary makes inter-state supplies (any amount), (3) The subsidiary is an e-commerce operator, (4) The subsidiary makes supplies on behalf of other registered persons. Even if the subsidiary has no revenue in Year 1 (common for new market-entry subsidiaries), GST registration may be needed early if making taxable imports of services from the parent (RCM — Reverse Charge Mechanism). TAXAJ advises on the optimal GST registration timing to avoid retrospective penalties.

From the parent company: certificate of incorporation, charter documents and a board resolution authorising the Indian investment — all apostilled/notarised. From each proposed director: passport, address proof and photograph (apostilled for foreign nationals). Plus proof of the Indian registered office (a recent utility bill and a no-objection certificate from the owner of the premises).

Yes. Foreign nationals can be directors and hold shares in an Indian subsidiary. However, the company must have at least one director who is resident in India — i.e. someone who has stayed in India for 182 days or more in the previous financial year (Section 149(3)). TAXAJ can provide a nominee resident director if you do not yet have one in India.

In most sectors, 100% FDI is permitted under the automatic route, meaning no prior government approval is required. Some sectors — such as defence, telecom, insurance, multi-brand retail and print media — have caps or require government approval. We confirm your specific sector's FDI route and cap before you invest, so the structure is compliant from day one.

An Indian subsidiary is treated as a domestic company for tax. It can opt for the concessional regime under Section 115BAA, giving an effective tax rate of about 25.17% (22% plus surcharge and cess). New manufacturing companies may qualify for a lower rate under Section 115BAB. Dividends paid to the foreign parent are taxable in the shareholder's hands and subject to withholding tax, which may be reduced under the applicable Double Taxation Avoidance Agreement (DTAA).

Yes. After Indian taxes, profits can be freely repatriated under FEMA through dividends, royalties or technical/service fees, subject to the relevant withholding tax and proper documentation (Form 15CA/15CB). There is no lock-in on dividend repatriation — a key reason foreign companies prefer the WOS structure over a Liaison Office.

The two key ones are FC-GPR — reporting the FDI to the RBI within 30 days of allotting shares to the foreign parent — and the annual FLA return (foreign liabilities and assets), due by 15 July each year. Share transfers between residents and non-residents are reported via FC-TRS. Missing these attracts penalties under FEMA 1999, so they should be tracked from day one; TAXAJ manages the full FEMA calendar for its subsidiary clients.