Is it possible to get the Indian Subsidiary Registration for Foreigners?

Yes, it is possible to get Indian Subsidiary Registration for Foreigners. There are lots of foreign companies who want to start their business in India and enter into one of the fastest-growing and largest markets in the world. Any Foreign National or an entity incorporated outside India can invest or own a company in India by acquiring shares of the company. Before the Indian Subsidiary Registration, you have to make sure that you have at least one director who must be an Indian Resident and one Foreign Director.

Subsidiary Company Registration is also referred as the Foreign Company which is governed by the Companies Act, 2013 and it is also known as sister company which has control over it is called holding company or parent company. Following are some characteristics of Indian Subsidiary Companies:

• It has to pay a low tax rate of 30%, which in case of Foreign Company has to pay 40% of tax.
• As per the Union Budget 2020, the distribution tax is NIL now.
• There is no requirement of prior approval for the repatriation dividend for these companies.

Following are some advantages that you can avail once you complete the process of Indian Subsidiary Registration:

• It helps to bring Foreign Direct Investment. The Government of India has approved 100% involvement of FDI (Foreign Direct Investment) for the fast-growing business.
• All the members and Directors of the company have limited liabilities. Limited liabilities protects the Director or shareholder of the company in a time of any loss, or financial distress bore by the company. The assets of personally held by the Directors or shareholders will not be at risk or seized by any creditors, banks or Government.
• The expansion and growth of the business are very easy because it rises the capital from the investors and financial institutions. Also, it has all the advantages of Private Limited Company, which gives more transparency.
• An Indian Subsidiary Company has the benefits of borrowing funds in the form of loans from financial institutions.
• It acts as a legal person; it can sue or can be sued.
• Foreign Subsidiary company gives them the authority to buy properties in India.
• It does not affect the Company’s existence if one of the members us dead, bankrupt, transfer, fired, etc.

Below are the lists of requirements of India Subsidiary Registration in India:

• No minimum capital requirement to form an Indian Subsidiary Company.
• Minimum two directors required for incorporation of the company.
• Minimum of two shareholders is required. Shareholders can be either entity or any individuals, or it can be both the combination.
• Must hold 50% of total equity share capital.
• It requires DIN for all the designated Directors.

Following are all the necessary documents required at the time of Indian Subsidiary Registration:

For Indian Citizen:

• Submit PAN Card of the directors and shareholders of the company.
• Address Proof like the latest electricity bill, water bill, telephone bill, etc.
• Identity proof such as Aadhar card, Voter ID, Driving License, etc.

For Foreign citizen:

• Submit a valid Passport.
• Address Proof. (Must certify the documents by Indian Consulate)
• Identity Proof. (Must certify the documents by Indian Consulate)

Other important documents:

• Latest passport-sized photograph of all the proposed directors and shareholders.
• Digital Signature Certificate of all the directors and shareholders.
• Directors Identification Number of all the directors and shareholders.
• Memorandum of Association of the company.
• Article of Association of the company.
• No Objection Certificate to be obtained from the person who owns the property.
• Residential Proof.
• Certificate of Incorporation issued by the Foreign Government.
• Submit Board Resolution of the Foreign Entity authorizing investment in shares of the Indian Company.
• Provide a list of directors and shareholders on the letterhead of the company.
• Submit proper details of opening and closing of a place of business in India on an earlier event.

To complete the process of Indian Subsidiary Registration, you have to follow the steps as mentioned below:

Step 1: Fill the application in the prescribed form:

SPICe+ Form is to be filled for the registration of a subsidiary. This form has two parts:

• In Part 1: Searching name for new companies.
• In Part 2: Application for DIN, PAN & TAN Application, GSTIN Application, Bank Account Opening, Incorporation, ESIC, and EPFO registration.

Step 2: Submission of documents:

After the filling SPICe+ Form, submit all the required documents as we mentioned above. If in case you miss any of these documents, then you are not able to file an application form.

• Step 3: Fee Payment:After uploading the documents, the applicant must pay the prescribed fees.
• Step 4: Issuance of Certificate:After submitting the application form along with the prescribed fee, the Registrar will verify all the documents. If the Registrar of Companies (RoC) didn't find any mistakes in the form and documents, they would issue the Certificate of Incorporation to the company.

Following are the annual compliances of Indian Subsidiary Company:

• Income Tax Return
• FEMA Guidelines.
• Guidelines with MCA (Ministry of Corporate Affairs).
• Compliance with Companies Act, 2013.
• Compliances with Income Tax Act, 1961.
• Annual return with the ROC (Registrar of Companies).
• Filing compliances with the Reserve Bank of India.
• Filing compliances with the Securities and Exchange Board of India.

Today's time, many of the foreign companies want to start their businesses in India because India becomes 7^th largest economy in the world, and by 2025, it will become 3^rd largest economy. Under Companies Act 2013, a subsidiary company can be defined in which a parent body or a foreign company has 50% minimum of the total share capital.