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Chartered Accountants
New Delhi
Setting up
business in
India
Setting up business in India 1
Disclaimer
This document is issued by
Contents
Rakesh Jain Rakesh
& Co. Jain & Co. May 2017
Chartered Accountants. It
is not intended as an oer
or solicitation for business
to anyone in any
jurisdiction. It is not
intended for distribution to
Mode of operation 3
anyone located in or Registering a company 5
resident in jurisdictions
which restrict the Corporate Taxation 6
distribution of this
document. It shall not be Audit & Compliance 7
copied, reproduced, Contacts 8
transmitted or further
distributed by any
CONTENTS
recipient. The information
contained in this document
is of a general nature only.
It is not meant to be
comprehensive and does
not constitute financial,
legal, tax or other
professional advice. You
should not act upon the
information contained in
this publication without
obtaining specific
professional advice. Whilst
every care has been taken
in preparing this document,
Rakesh Jain & Co. does
not makes any guarantee,
representation or warranty
(express or implied) as to
its accuracy or
completeness, and under
Rakesh Jain & Co.
no circumstances will
Rakesh Jain & Co. be liable Chartered Accountants
for any loss caused by New Delhi
Setting up business in India 2
reliance on any opinion or
statement made in this
document.
Rakesh Jain & Co. May 2017
Mode of operation
Operating as an Indian the advantages of a
company, such as being a
Company separate legal entity having
perpetual succession, with
A Wholly owned subsidiary the benefits of organisational
A foreign company can set flexibility in a partnership. At
up a wholly-owned least two partners are
subsidiary company in India required to form a LLP.
A liaison oce is not allowed Rendering professional or
to undertake any business consultancy services.
promotes technical or
financial collaborations
Project oce
between Indian companies
Foreign companies planning
and a parent or overseas
to execute specific projects
group company.
Registering a Company
Registrations Requirements Documents Foreign Director (residing
in India)
Company Law - Certificate Directors Indian Director Following documents
of Incorporation (COI) A minimum of 2 persons to attested by individuals
Identity proof (example -
COI is issued by Registrar of act as Directors of the Passport / Aadhaar)
embassy -
Companies. This is the company are required. Passport
Photograph
primary requirement to open Address proof - Drivers Any one of the below
a bank account. Company Address license / bank statement
documents -
Tax Deduction & Collection An address in India is
Photograph on Digital Proof of ownership
specified payments are owned or with NOC from the with proof of ownership
made to vendors.
Signature
(example - utility bill)
legal owner.
Corporate Taxation
Corporate Income Tax
Table 1 - Corporate Tax Rates in India
Corporate tax
Domestic Foreign
Corporate tax rates are as
company company
mentioned in Table 1
Where turnover < INR 500 million Where profit < INR 10 million 25.75% 41.20%
Dividend distribution tax Where profit > INR 10 million & < INR 100 million 27.55% 42.02%
(DDT)
other cases 28.84% 43.26%
Dividend income is exempt
in the hands of the Where turnover > INR 500 million Where profit < INR 10 million 30.90% 41.20%
shareholders. However, a Where profit > INR 10 million & < INR 100 million 33.06% 42.02%
DDT is levied on companies other cases 34.61% 43.26%
declaring dividends @15%
plus surcharge & cess.
Corporate tax
private and public companies Corporate Income Tax return
Employment laws
and branches of foreign is to be filed annually on or
Companies must comply
companies are required to be before 30th September each
with various laws protecting
audited by independent year.
Company law
Companies are also required
to file annual returns with
Registrar of Companies
Partner