Company Formation Services in India
Learn the best ways of starting a business in India, different types of business structures in India, and what is required to start a business in India.
- We will help you register your company in India
- We will help you look for and choose a suitable partner or sponsor from India
- We will help you set-up your business and associated requirements
- We will help you register for tax and licenses
Find out how to register a company/business in India in very easy steps. Our comprehensive list of services is here to help you.
India is one the largest country in the whole South Asian region, which shares its border with Pakistan, China, Nepal, Bhutan, Myanmar, Sri Lanka, and the Maldives and its maritime boundaries with Indonesia. Being the second most populated country in the world, there are greater opportunities for businesses in the country.
India is famous for its agricultural productivity, its spices, tobacco, jute, steel, handicrafts and many other products and their exports. There is plenty of business opportunities in the Indian economy specifically due to its skilled Human Resources, low paid labour and higher economic growth.
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Finding A Partner
Similar to Middle East Countries, you may require a partner from an Indian to get a business established in the country. Helpline Group can guide you and help you gain an Indian partner.
Business set-up activities in India may change depending on the industry and type of company. Helpline Group can guide you and help you apply for business set-up.
You may need to apply for additional licenses to begin operations of your business in India. Helpline Group can guide you and help you get these licenses in India.
While 100% business ownership is now available for foreign investors and businesses in most industrial sectors, the Indian Government is planning to allow 100% foreign ownership in other key areas, including retail to boost economic growth in India through liberal regulations in the economy.
India is a highly favourable country from an investment point of view because of the steady political environment and economic stability. Abundant raw material, educated and talented workforce, skilled and semi-skilled labours at low prices and such make it a strategically good option for foreign businesses.
Legal Structures of the Company
The business structure is the first issue to be dealt with when thinking of company formation in India. One must select the best suited legal business structure, which defines the business and its legal requirement. In India, there are several business structures with different requirements that can be opted to avail the investment. The business categorisation is done on the basis of a number of members, ownership (public or private), control on the company, liability, etc. Some of the major structures required for the company set up in India are given below.
- One Person Company
- Sole Proprietorship
- Partnership Firm
- General Partnership Company
- Limited Share Partnership Company
- Public Share Holding Company
- Branch Office
- Commercial Agencies
- Representative Trade Offices
- Holding Company
- Joint Venture
One Person Company in India
This is a new type of company structure in India. A One Person Company or OPC is a different concept to encourage the common man in contributing to economic growth through entrepreneurial capabilities. Only one person works as both the Board of Directors and the shareholder. One Person Company formation in India can only be done by an Indian, not by any foreign entity.
Under Indian Companies Act, an OPC is categorised as Private Company. An OPC acts as a separate legal entity just like a Private Company and it has a perpetual succession. It can be easily incorporated with a minimum paid up capital of ₹1 lac and maximum paid-up capital can be ₹ 50 lacs.
Sole Proprietorship in India
Sole Proprietorship is the easiest way to have a company set up in India. Sole Proprietorship does not need any legal approval, as it is owned and governed by the individual person. The individual governing this business has full liability to the extent of his personal wealth. As the business belongs to an individual, thus, the profit is owned by him fully and he or she is taxed according to the tax bracket prevailing at that time. Sole Proprietorship is taxed if profit exceeds the specified tax limit and provisions under Section 44 (AB) of Indian Income Act are applied to it.
Partnership Firm in India
A partnership firm is formed with the agreement between two or more person. In a partnership firm, all the profits and losses are shared equally or as mentioned in the partnership deed of the company. A ‘Partnership Deed’ is an agreement formed between the partners, which describe their duties, responsibilities, share of profit and loss along with other details. In a partnership firm, there can be a minimum of 2 partners but the maximum number of partner for banking firm is up to 10 and for other partnership firms it is 20.
Helpline group can assist and guide you how to business in India through minimum documentation with maximum utilisation of time. Incorporating a partnership firm gets easier faster while working with Helpline Group, we can get all the paperwork done and incorporation of firm completed within a few days.
General Partnership Company in India
A General partnership company set up in India comes in existence through the agreement created between two or more partners who have the responsibility to manage and administer the company’s rules and regulations. The partners forming the contract are held responsible jointly and severally to for all the debts and liabilities of the company to the full extent to their personal property.
Every partner working in the firm has the right to make contracts are performed deals on behalf of the firm until and unless specified in partnership deed. Establishing a general partnership company set up in India can be more expensive as compared to a sole proprietorship, as it needs more legal knowledge and has more accountability. Helpline Group experts can give you perfect suggestions about how to start a company in India with minimum legal complexities.
Limited Share Partnership Company in India
Limited Liability Partnership Act of 2008 was formed with a vision to minimise the liabilities of the owners. Under LLP, there are two types of partners, first, general partners have unlimited liability and have the full right to take participation in management. Second, limited partners have limited rights and liabilities in the company; they are liable to the extent of their contribution to the company.
Under this business structure, death or insolvency of limited liability partners does not affect the existence of the company. Limited Share Partnership Company works as a corporate body with its legal existence in the market. This business structure is more complex in nature and can be understood well only under best guidance. Helpline Group’s experts are here to guide you with the best tips for how to start a company in India by avoiding legal complications.
Holding Company in India
According to the Indian Company Act of 2013, a holding company is a company that has a relationship with more than one company as a subsidiary company. A company controlling the activities of other company is known as Holding Company, whereas the company getting controlled is known as Subsidiary Company. Control can be maintained by attaining the majority of shares of the company or by controlling the activities of the company.
Holding company set up in India can be done to avail benefits like better control, easy financing, easy ownership transfer, taxation benefits etc. A holding company have the right to manage the composition of Board of Directors in the company, as it holds more than 50% of shares of the subsidiary company.
Public Shareholding Company in India
Public Share Holding Companies in India are also known as Joint Stock Companies. It is usually initiated with a view to make investments for greater returns without much liability. In a public company, shares are divided into equal parts which are traded for public subscription in a local Indian stock exchange. Public Share Holding Company is regulated according to the Indian Companies Act 1956, which was further amended through Companies Act 2013.
A Company is given legal identity in the eyes of law with a separate name; all the contracts are formed in the name of the company. Helpline group can assist in all the documentation work you require to establish this business. There are two major forms of a limited company set up in India-
Public Limited Company: A public limited company is governed and owned by the public. In this business, there can be at least 3 shareholders and there is no limit to a maximum number of shareholders. Shareholders can easily transfer their shares to anyone without any required permission. To start this business venture, you need to have ₹ 500,000 as a minimum paid up capital.
Private Limited Company: A private limited company is governed and owned privately. It can have more than 2 shareholders but not exceeding 50 shareholders with a minimum of 2 Board of Directors. Shareholders cannot transfer their shares to outside members, as shares are restricted to the members of the company only. Minimum paid-up capital required to start this business is ₹ 1 lac. This is the most common and widely used practice in the country.
Joint Ventures in India
A joint venture is an agreement created by the association formed between two or more business partners. In this, business is set up through an agreement between the working partners to complete a common task or to work together for a limited time period. Once the purpose of company formation is fulfilled, it gets dissolved without affecting their independent corporate image. Joint Venture can be formed with the purpose to minimise corporate cost and it also decreases risk attached with starting a new business.
However, there is no separate law governing Joint Venture Company set up in India, but Joint ventures are required to comply with general business laws governing Indian business and take prior necessary approvals. Establishing a Joint Venture Company formation in India with an NRI or foreign partner or PIO partner requires prior permission from the Indian government. This approval can also be obtained from the Foreign Investment Promotion Board of India (FIPB) or the Reserve Bank of India (RBI).
Representative Trade Offices (RTO) in India
A Representative Trade Office is also known as a Liaison Office in India which is established with a purpose to have a better understanding of investment and business environment. It can work as a communication link between the parent company and Indian customers or agencies. It can also participate in Tender- PAC summits or workshops or conferences. A Liaison Office cannot deal in any type of industrial or commercial or trading activities.
It can only handle promotional activities of import /export, promotional or marketing functions, or collection of information. For representative trade office’s commercial registration in India, prior approval of RBI is required to obtain Certificate of Incorporation from the Registrar of Companies. The parent company is held responsible for all the activities conducted by the RTO in India; it also has the responsibility to bear all the expenses of the RTO as it does not have any income for its own.
Commercial Agencies in India
Commercial agency contract formation is allowed under Indian Company Law. An Agency’s Commercial registration in India needs an appointment of Commercial Agent for selling and marketing the parent company’s products in India. Although the contract is formed according to a foreign company, establishing a commercial agency requires strong compliance with the Indian laws for establishing a market and conducting business. Commercial
Agency law includes all important points that are required for smooth operations of work including the appointment of an agent, duration of the contract, commission or agent’s fee, non-competition clauses, governing laws, dispute resolution, etc. Agents can be paid in the form of commission on sales, or fixed salary or allowance for travelling and marketing incidentals can be paid (as per the contract).
Branch Offices in India
Foreign entities are allowed to open a Branch Office in India. Reserve Bank of India (RBI) has the right to give permission for setting up a branch office of a foreign company in India. A company dealing in activities like trading and manufacturing can set up a branch office in India with the purpose to render consultancy services, marketing or promotional activities, professional services, or import and export of goods, and technical support (after sales support) etc.
A branch office cannot deal in manufacturing activities itself but it can sub-contract for manufacturing the same products as by its parent company. Branch Office commercial registration in India is governed under Registrar of Companies within 30 days of business commencement. Helpline Group can help you set up branch offices in India.
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Other Factors You Should Consider for Business Formation in India
Real estate business is the most lucrative business and profitable business in India. This sector is divided into three major parts like agricultural land, commercial land, and residential land and all the sectors are growing fast due to heavy investment from foreign entities and the middle-income group of India. Real estate business in India needs proper documentation work, without which you may end up risking your investments.
Helpline Group can share the workload with you and guide you properly for all your queries related to how to start a business in India and engage in real estate activities. Real estate business agents are charged under the Service Tax Act of India, the gross amount is charged at 14% under this act.
Indian taxation system is very complex. Corporate tax is charged on both foreign as well as on local companies. Whether it is an individual or big businesses, everyone is supposed to pay tax on the income earned annually. Taxation rate varies from company to company; it depends on the size of the company or income earned by the company in the financial year or on the nature of the company or on the origin of the company.
Taxation on the foreign company is governed by the tax agreements framed between India and the foreign country whereas a flat rate of 25% (corporate tax) +12% (surcharge) +3% (educational cess) (tax rate varies with financial year policy) is charged on the domestic company. To know how to start a company in India under the complex taxation system, you can take our help, as Helpline Group has an expert team handling government authorities and legal work in India.
India follows a very strict visa system. All business firms are given all types of visa facility, as per their requirement. A ‘business visa’ is given for the purpose to make business-related trips to India like entering into a business contract or for making a business sale, etc. All the people coming with the applicant should have an ‘Entry visa’ not a business or tourist visa. In India business visa is granted to the people, only if they are foreign nationals and coming to India for starting a business venture, making business purchases, selling company products, attending company meetings or seminars, recruiting manpower, participating in trade fairs, monitoring business work, or any other business related activity.
Due to the positive changes in the business environment, import business is getting lucrative to small and medium companies. Many small entrepreneurs are handling business from their home and earns good returns. Moreover, the Indian government policies are also supporting the growth of import business in India. To start an import business, you may need a pan card, open a current bank account, registration of firm under companies act, acquire an Import Export Code (IEC), and file an application for Registration-cum-Membership-Certificate (RCMC) and signing a contract with a clearing agent. However, importing system in India involves several complexities but we the Helpline experts can guide you about company formation in India and can even work on behalf of you.
Get in touch with Helpline Group today to take your goals further.
Our Company Formation Services are available in many countries. To know more about our services, please leave a message, stating your requirements on the left. Alternatively, you may contact us through either of the following methods. Helpline Group associates will contact you as soon as possible. We are also available in WhatsApp (Use the following numbers).