Before you can invoice a customer in India you need a legal entity, a tax identity, a bank account that can receive foreign capital, and the state registrations that depend on where you sit and how many people you hire. We advise on the structure first, then execute every step.
The five ways a foreign business can be present in India, side by side. The right answer usually falls out of two questions: will the India presence earn revenue, and do you want a separate Indian legal entity?
| Private limited company (subsidiary) | LLP | Branch office | Liaison office | Project office | |
|---|---|---|---|---|---|
| Legal status | Separate Indian company | Separate Indian body corporate | Extension of the foreign company | Extension of the foreign company | Extension, for one project |
| Can earn revenue in India | Yes, any lawful activity | Yes | Yes, within RBI-permitted activities | No — representation only | Yes, for the awarded contract only |
| Foreign ownership | Up to 100% in most sectors (automatic route) | 100% only where sector is 100% automatic with no conditions | n/a (no Indian shareholding) | n/a | n/a |
| Approval needed | None (MCA registration) | None (MCA registration) | RBI, via AD bank (Form FNC) | RBI, via AD bank (Form FNC) | General permission if conditions met; else RBI |
| India income-tax (headline rate) | 22% (concessional domestic-company regime) | 30% (LLP rate) | 35% (foreign-company rate) | Nil — no income | 35% (foreign-company rate) |
| People needed | 2 directors (one India-resident 182+ days), 2 shareholders | 2 designated partners (one India-resident) | Authorised representative | Authorised representative | Authorised representative |
| Indicative set-up time | 2–3 weeks after documents | 2–3 weeks | 6–10 weeks | 6–10 weeks | 3–6 weeks |
| Best for | Operating business, hiring, raising capital | Services firms not raising VC | Service delivery / contracts without a new entity | Market study, sourcing, coordination | EPC, infrastructure, installation contracts |
Headline rates under the Income-tax Act, 2025 for the current tax year, before surcharge, cess and treaty relief. Confirm the rate for your facts before deciding. Rates last verified 2026-10-03.
Three or four questions, and an indication of where you are likely to land. It is a starting point for the conversation, not advice.
Why: A liaison office may represent the parent, study the market and coordinate — but it may not earn income in India.
Watch out for: Parent needs a 3-year profit record and net worth of at least USD 50,000; set-up runs 6–10 weeks through an AD bank.
Why: A project office exists for one awarded contract and closes when the project completes.
Watch out for: General permission applies only if the conditions are met; otherwise RBI approval is needed. Set-up runs 3–6 weeks.
Why: A branch can deliver services and perform contracts within RBI-permitted activities without creating a new Indian entity.
Watch out for: Parent needs a 5-year profit record and net worth of at least USD 100,000, the parent stays fully liable, and the foreign-company tax rate of 35% applies.
Why: A subsidiary limits liability, can hire freely, can issue ESOPs and is the structure investors expect.
Watch out for: You need two directors, one of them resident in India for 182 days or more, and the annual compliance load is the highest of the five.
Why: An LLP suits a services firm that is not raising venture capital, with a lighter annual load than a company.
Watch out for: Foreign investment into an LLP is only possible where the sector is 100% automatic with no conditions attached.
Indian registrations switch on as you hire. Each line is cumulative.
| Headcount in India | Registrations and monthly filings triggered | |
|---|---|---|
| 1 employee | Shops & Establishments; Professional Tax (RC) — deduct and pay monthly; TDS on salary — deposit by 7th, quarterly statements; payroll under the Labour Codes | |
| 10 or more | + ESI (employees earning ≤ ₹21,000) — contribution within 15 days of month-end; + Gratuity applicability notice | |
| 20 or more | + EPF — ECR and payment by 15th; International Worker rules for expats | |
| Any expatriate | FRRO registration within 14 days; EPF as International Worker from day one unless a Social Security Agreement certificate applies | |
| Manufacturing, 20+ workers with power / 40+ without | + Factory licence, pollution consents (CFE/CFO), fire NOC |
Independent advice on how to enter India — subsidiary, LLP, branch, liaison or project office — before you commit capital.
Who needs this
The default vehicle for operating businesses in India — limited liability, 100% foreign ownership permitted in most sectors, two directors and two shareholders minimum.
Who needs this
For businesses that will have more than 200 shareholders, plan a listing, or need the public-company form for regulatory reasons.
Who needs this
A limited-liability company with a single shareholder — for solo Indian founders who want corporate status without a co-founder.
Who needs this
Partnership flexibility with limited liability and lighter compliance — suited to professional services and businesses that will not raise venture capital.
Who needs this
The simplest multi-owner structure under the Indian Partnership Act, 1932 — quick to form, but partners carry unlimited liability.
Who needs this
A representative office that can promote the parent's business, gather market information and coordinate — but cannot earn income in India.
Who needs this
An extension of the foreign parent that can carry on permitted commercial activities in India — export/import, consultancy, research, IT services — and repatriate profits.
Who needs this
A temporary office to execute a specific contract awarded by an Indian company — typically for infrastructure, EPC and installation projects.
Who needs this
The reporting a foreign investor must complete after money arrives in India — miss it and the company faces late-submission fees or compounding.
Who needs this
GST is India's single indirect tax; registration gives you a GSTIN and lets you charge tax and claim input credits.
Who needs this
A PAN-based code from the DGFT required for any import or export of goods, and for services where benefits are claimed.
India's four Labour Codes came into force on 21 November 2025, replacing the older EPF, ESI, Gratuity and Factories Acts. The registrations below are described under the Codes; thresholds have largely carried over.
The basic registration for any office, shop or commercial establishment in Karnataka — obtained on the e-Karmika portal — and the document most banks and landlords ask for first.
A state tax on professions and employment. The entity pays its own annual tax under an Enrolment Certificate; as an employer it deducts tax from staff salaries under a Registration Certificate.
Mandatory retirement-savings scheme once you employ 20 or more people; employer and employee each contribute 12% of wages up to the ceiling.
Who needs this
State medical and cash-benefit insurance for employees earning up to ₹21,000 a month; mandatory once you have 10 or more employees in Karnataka.
Once you have 10 or more employees, gratuity (a lump sum after five years' service) becomes payable; larger employers fund it through an approved trust for tax efficiency.
Required before a manufacturing unit can operate — obtained from the Karnataka Department of Factories, Boilers, Industrial Safety & Health.
Who needs this
The KSPCB must approve your unit before it is built (CFE) and again before it starts operating (CFO).
Who needs this
A NOC from Karnataka State Fire & Emergency Services confirming the building's fire-safety arrangements — required for high-rise buildings and specified occupancies before other approvals are granted.
Whatever else your specific business needs to operate lawfully — we identify it during set-up so nothing is discovered later.
Call, WhatsApp or send an enquiry — we reply within one working day.
