Business Registration in India from the UK: Full Guide

Can a British Citizen Start a Business in India

Yes. Under current regulations, a British citizen or a UK registered company can set up and own a business in India in most sectors, without needing an Indian partner or prior government approval. This falls under India's foreign direct investment (FDI) framework, and the vast majority of industries that a typical UK founder operates in, software, consulting, e commerce enablement, professional services, manufacturing, fall under what is called the automatic route.

That said, "can" is different from "how," and this is where most generic guides stop short. The practical questions for a UK founder are about which entity should hold the shares, how documents get authenticated across two jurisdictions, who signs as a resident director, and how profits eventually come back to London. This guide answers those.

Personal Shareholding or UK Company as Parent

There are two broad ways a UK founder structures ownership of an Indian company.

The first is personal shareholding, where you as an individual UK resident hold shares directly in the Indian entity. This is simple on paper but creates some friction around personal tax residency questions, personal KYC at Indian banks, and how UK investors or acquirers view the structure later.

The second, and the one most UK founders with an existing business end up using, is setting up the Indian company as a subsidiary of your UK Limited company. The UK company subscribes to shares in the Indian entity, becomes its majority or sole shareholder, and the Indian company operates as a wholly owned or majority owned subsidiary. This is generally cleaner for accounting consolidation, for investor diligence, and for treaty based repatriation planning.

FDI Rules in Plain English

India's FDI policy sorts sectors into an automatic route, where foreign investment (including one hundred percent by a UK entity) is permitted without prior approval from the government, and a government route, where certain sectors need approval before investment. Under current rules, most services, technology, and manufacturing activities that UK founders typically pursue sit in the automatic route. Sectors like defence, media, and certain multi brand retail formats have specific conditions or caps that should be checked for your exact activity before you commit to a structure, since these rules are revised periodically.

Whatever the route, the investment still needs to be reported to the Reserve Bank of India (RBI) once the shares are allotted, which we cover under money in, money out below.

Choosing the Structure from the UK

Private Limited Subsidiary

A Private Limited company incorporated in India, with your UK company as shareholder, is the default choice for most UK founders. It gives limited liability to the parent, is the structure Indian and UK investors are most familiar with, allows straightforward equity fundraising later, and sits comfortably within the automatic FDI route for most sectors. It also has the clearest compliance calendar, which matters when you are managing this from another country and want predictability rather than surprises.

LLP and Branch Office Compared

An LLP (Limited Liability Partnership) is sometimes suggested for its simpler compliance burden, but under current rules foreign investment into an LLP is generally restricted to sectors where one hundred percent FDI is allowed under the automatic route with no performance linked conditions, and LLPs are far less attractive to future equity investors since they do not have share capital in the conventional sense. Most UK founders planning to raise investment or bring in a co founder later should be cautious here.

A branch office or liaison office is a different animal altogether. These are extensions of the UK parent company rather than separate Indian legal entities, need specific RBI approval, and are restricted in what activities they may carry out in India, a liaison office in particular cannot generate revenue in India at all. These suit specific use cases such as market research or coordination offices, but not a UK founder building and selling a product or service in India.

What Most UK Founders Choose

In practice, the overwhelming majority of UK founders setting up in India choose a Private Limited subsidiary of their UK company. It balances limited liability, investor familiarity, fundraising flexibility, and treaty based repatriation planning better than the alternatives, and it is the structure this guide assumes from here.

The Registration Process from London

SPICe Plus Without Flying to India

Company incorporation in India is filed through an integrated online form generally referred to as SPICe Plus, which in a single filing covers name reservation, incorporation, DIN allotment for directors, PAN and TAN application, and registration with employee welfare bodies where applicable. None of this requires you to be physically present in India. What it does require is a clean set of properly authenticated documents from the UK side, which is where most delays actually happen, not the filing itself.

Apostille of UK Documents

Because the UK and India are both signatories to the Hague Apostille Convention, documents executed in the UK, such as identity proof, address proof, and board resolutions of the UK parent authorising the investment, need to be apostilled rather than embassy legalised. In practice this means having the relevant documents notarised in the UK and then apostilled, generally through the Foreign, Commonwealth and Development Office process, before they are couriered to India for use in the incorporation filing. Building this step into your timeline early avoids the single most common cause of delay for UK founders.

DIN and DSC for UK Residents

Every director of the new Indian company needs a Director Identification Number (DIN), and the incorporation filing itself needs to be digitally signed using a Digital Signature Certificate (DSC). For UK resident directors, since Indian biometric identity systems are not available to non residents, DSC issuance generally relies on a paper based or video verification process using apostilled identity and address documents. This adds a small amount of lead time compared to an Indian resident applicant, so it is worth starting this in parallel with the apostille process rather than after it.

Solving the Resident Director Requirement

Under current Companies Act requirements, every Indian company must have at least one director who satisfies a minimum stay requirement in India during the relevant calendar year (the exact day threshold should be verified at the time of filing, since it is a fixed rule but worth confirming with your advisor). For a UK founder with no existing India based team, this is usually the trickiest requirement to satisfy on paper.

The common solutions are appointing a trusted Indian resident, such as a co founder, relative, or local hire, as a director with clearly limited authority defined through the board and shareholder agreements, or engaging a professional resident director service through a corporate secretarial firm, structured with appropriate indemnities so the nominee has no beneficial interest and limited operational authority. Either way, this should be documented properly from day one rather than treated as a formality, since it affects signing authority on filings and bank mandates.

Money In, Money Out

Capital Remittance and FC GPR

Once the Indian subsidiary is incorporated, the UK parent remits share subscription money through normal banking channels to the subsidiary's Indian bank account. This inbound investment then needs to be reported to the RBI, generally through a filing known as FC GPR, submitted through an authorised dealer bank on RBI's online reporting portal, within the timeline prescribed under current regulations. Missing this reporting step, or getting it wrong, is a common and avoidable compliance gap for foreign owned Indian subsidiaries.

Repatriation and the UK India Tax Treaty

When the Indian subsidiary eventually pays dividends back to the UK parent, that payment is subject to withholding tax in India. Under current rules, the India UK Double Taxation Avoidance Agreement (DTAA) generally allows the UK parent to claim a treaty rate on dividend withholding that can be more favourable than the standard domestic rate, subject to conditions such as holding a Tax Residency Certificate from UK tax authorities and meeting beneficial ownership requirements.

On documentation, note that under the Income Tax Act 2025, which has replaced the earlier 1961 Act, the withholding certification and remittance forms that professionals used to call Form 15CB and Form 15CA are now referred to as Form 146 and Form 145 respectively, and the old TDS certificate familiar as Form 16A is now Form 131. The underlying obligation, a chartered accountant certifying the remittance and the remitting bank filing the form before releasing funds, remains conceptually the same, just under the renumbered forms and provisions of the 2025 Act.

Banking Friction to Expect

UK founders often underestimate how much friction sits at the banking layer. Opening the Indian subsidiary's bank account needs board resolutions, apostilled KYC documents for UK directors and shareholders, and sometimes video verification that can be awkward across time zones. Outward remittance of dividends or royalty payments similarly needs supporting documentation, the withholding certification mentioned above, and can take longer than a UK founder expects from a domestic banking relationship. Choosing a bank in India with genuine experience handling foreign owned subsidiaries, rather than a branch that mainly serves retail customers, makes a real difference here.

Running It Compliantly from the UK

The Annual Compliance Calendar

An Indian Private Limited subsidiary has a recurring annual compliance calendar regardless of whether it is actively trading, including filing of financial statements and annual returns with the Registrar of Companies, holding board meetings at prescribed intervals, statutory audit of accounts, and filing of the company's income tax return. If the subsidiary transacts with its UK parent, transfer pricing documentation is generally also required to demonstrate that intercompany pricing is at arm's length. None of this is optional simply because the founder is based in the UK, and penalties for missed filings can compound over successive years.

Payroll and GST Basics

Once the Indian subsidiary hires employees, it takes on payroll withholding obligations, generally provident fund and, where applicable, employee state insurance contributions, along with state specific professional tax and tax deduction at source on salaries. Separately, GST (Goods and Services Tax) registration becomes necessary once the company's turnover crosses the applicable threshold, or in some cases regardless of turnover depending on the nature of the activity, and intercompany invoicing with the UK parent, for instance for services rendered to it, needs to be structured correctly to take advantage of export of services treatment where it applies.

What a Retainer Should Cover

Given how many moving parts sit across company law, FEMA (foreign exchange regulations), income tax, and GST, most UK founders find it more practical to hold a single ongoing compliance retainer rather than piecing services together reactively. A retainer worth its cost should generally cover bookkeeping and statutory filings, payroll processing, RBI reporting including FC GPR at investment stage and the annual FLA return thereafter, coordination on transfer pricing documentation, and a single point of contact who can speak to your UK finance team in terms they understand, rather than purely in Indian regulatory language.

Costs and Timeline from the UK

Realistic All In Budget

Costs for a UK founder setting up in India generally fall into three buckets: one time incorporation costs including apostille, DSC, DIN, and government filing fees; professional fees for the advisor managing the process; and the ongoing annual compliance retainer once the company is running. Government fees themselves are revised periodically and should be confirmed at the time of filing [current figure, to verify], and professional fee quotes vary based on complexity, particularly around resident director arrangements and the number of UK directors requiring DSC and DIN. It is worth asking any advisor for a written, itemised quote rather than a single bundled number, so you can see what you are paying for at each stage.

Week by Week Timeline

A realistic timeline from a UK founder's perspective generally starts with document preparation and apostille in the UK, which typically takes the longest single stretch given courier and processing times. DSC and DIN applications for UK resident directors can run in parallel with this. Once documents are in hand, name reservation and the SPICe Plus filing itself tend to move faster, followed by PAN and TAN issuance and finally bank account opening. Founders who start the apostille process the day they decide to incorporate, rather than after choosing an advisor, generally reach an operating Indian bank account meaningfully sooner than those who treat it as a later step. Exact durations vary with government processing times [current figure, to verify], so treat any quoted number of days as indicative rather than guaranteed.