INCORPORATION
Our view on how much authorised capital a foreign subsidiary in India should start with: why ₹15 lakh is the default, what a later SH-7 increase costs, and when a higher start is worth it.
Incorporation
Written by Nihal Srivastava, Krystal7 Consultants. Last updated 26 October 2026.
Our view is that most foreign subsidiaries should start with exactly ₹15 lakh of authorised capital. The MCA registration fee is nil up to that line. The saving also survives later increases, because the SH-7 fee deducts the scale fee on the existing ₹15 lakh. Incorporating at ₹15 lakh and later moving to ₹50 lakh costs ₹1,05,000 in MCA fees, against ₹1,56,000 to start at ₹50 lakh. We advise a higher start only when a remittance above ₹15 lakh will land before the company can pass an increase.
This is a practitioner opinion with the numbers behind it. Where a point is law, we cite the rule. Where it is our judgement, we say so. The page covers the three kinds of capital, the ₹15 lakh fee line and stamp duty by state. It then covers the FDI timing rules, the cost of a later increase in Delhi and Karnataka, and when a loan from the parent fits better than shares.
Authorised capital is a ceiling, and nobody pays it in. It caps the share capital the company can issue without changing its memorandum of association (MoA). It also sets the MCA registration fee and, in many states, the stamp duty. Paid up capital is the money that has reached the company against shares it has issued.
| Term | Meaning in the Companies Act, 2013 | Example for a new subsidiary |
|---|---|---|
| Authorised (nominal) capital | Section 2(8): the capital the MoA authorises as the maximum share capital | ₹15,00,000 in the capital clause |
| Subscribed capital | Section 2(86): the part of the capital that members have for the time being subscribed | The parent and a nominee subscribe for ₹10,00,000 of shares |
| Paid up share capital | Section 2(64): the money credited as paid up on shares issued | ₹10,00,000 once the remittance arrives and the shares are issued |
Source: Companies Act, 2013, section 2, as hosted by the Income Tax Department (read 26 Oct 2026).
The gap between authorised and paid up capital is headroom. It costs nothing to hold, and it lets the parent send more money later without a change to the MoA. MCA's public company data shows both figures, so a counterparty can see the headroom.
No. MCA's ease of doing business page records that the Companies (Amendment) Act, 2015 removed the requirement for minimum paid up capital. There is no statutory minimum for authorised capital either. A company can incorporate with ₹1 lakh of authorised capital if that is all it needs.
The subscribers still have to pay. Section 10A of the Companies Act, 2013 requires a director to declare, within 180 days of incorporation, that every subscriber to the MoA has paid for the shares agreed. Missing it costs the company ₹50,000 and each officer in default ₹1,000 a day, up to ₹1 lakh. Our guide on INC-20A for a foreign subsidiary covers that filing.
So the real question is how much headroom to buy at incorporation and how much money to put in during year one. Those are two decisions, and we treat them separately.
Because ₹15 lakh is the highest capital that pays no MCA registration fee. Rule 38(2) of the Companies (Incorporation) Rules, 2014 switches off the SPICe+ fee up to that line, and G.S.R. 180(E) of 6 Mar 2019 set it there from 18 Mar 2019. One rupee above it, the fee applies to the whole capital.
A subsidiary pays the higher of the two fee scales. Section 2(85) of the Companies Act, 2013 excludes holding and subsidiary companies from the small company definition. So a company owned by a foreign parent pays the other company scale. That scale is ₹36,000 for the first ₹10 lakh, then ₹300 for every ₹10,000 or part up to ₹50 lakh. It drops to ₹100 for every ₹10,000 up to ₹1 crore and ₹75 above that.
The waiver keeps its value when the company grows. The fee on an increase, filed in Form SH-7, is the scale fee on the new capital less the scale fee on the existing capital. The scale fee on ₹15 lakh is ₹51,000, which the company never paid. So reaching any capital above ₹15 lakh in two steps costs ₹51,000 less than incorporating there directly.
| Target authorised capital | Incorporate at the target | Incorporate at ₹15 lakh, then file SH-7 | Saving |
|---|---|---|---|
| ₹25 lakh | ₹81,000 | ₹30,000 | ₹51,000 |
| ₹50 lakh | ₹1,56,000 | ₹1,05,000 | ₹51,000 |
| ₹1 crore | ₹2,06,000 | ₹1,55,000 | ₹51,000 |
| ₹10 crore | ₹8,81,000 | ₹8,30,000 | ₹51,000 |
Source: MCA instruction kit for Form SH-7, Table 1 and the rule on the fee for an increase; rule 38(2), Companies (Incorporation) Rules, 2014 (read 26 Oct 2026). MCA fees only; stamp duty is in the next table.
The direct route also carries the ₹500 SPICe+ fee that rule 38(2) names above ₹15 lakh, so the real saving is ₹51,500. Our authorised capital fee calculator runs the same arithmetic for any pair of figures.
Below ₹15 lakh, part of the waiver is wasted. Between ₹5 lakh and ₹15 lakh, each ₹1 lakh below the line adds ₹3,000 to any later SH-7 fee, because the scale charges ₹300 for every ₹10,000 in that band. A ₹10 lakh company that grows to ₹50 lakh pays ₹1,20,000 in SH-7 fees, against ₹1,05,000 from ₹15 lakh.
In our view, that is why ₹15 lakh is the default. It costs nothing to use, and it keeps paying for as long as the company exists.
Stamp duty on the articles of association (AoA) follows the state of the registered office, and in many states it grows with authorised capital. MCA collects it in the SPICe+ challan at incorporation and in the SH-7 challan on an increase.
| State | AoA duty at ₹15 lakh | AoA duty at ₹50 lakh | AoA duty at ₹1 crore | Duty on an SH-7 increase from ₹15 lakh to ₹50 lakh |
|---|---|---|---|---|
| Delhi | ₹2,250 | ₹7,500 | ₹15,000 | ₹5,250 (0.15% of the increase) |
| Haryana | ₹120 | ₹120 | ₹120 | Nil |
| Maharashtra | ₹3,000 | ₹10,000 | ₹20,000 | ₹7,000 (₹1,000 per ₹5 lakh or part) |
| Karnataka | ₹1,000 | ₹2,500 | ₹5,000 | ₹2,000 (₹500 per ₹10 lakh or part) |
| Tamil Nadu | ₹300 | ₹300 | ₹300 | Nil |
| Telangana | ₹2,250 | ₹7,500 | ₹15,000 | ₹5,250 (0.15%, min ₹1,000) |
| Gujarat | ₹7,500 | ₹25,000 | ₹50,000 | ₹17,500 (0.5% of new less 0.5% of old) |
| Uttar Pradesh | ₹500 | ₹500 | ₹500 | Nil |
| West Bengal | ₹300 | ₹300 | ₹300 | Nil |
| Kerala | ₹5,000 | ₹25,000 | ₹50,000 | Nil |
Sources: MCA e stamp schedule and SH-7 instruction kit, Annexure A (read 26 Oct 2026). The Delhi and Haryana figures at ₹15 lakh match our SPICe+ challans of 15 Oct 2026 and 14 Aug 2026.
Two patterns matter for the decision. In Delhi, Telangana, Maharashtra and Gujarat, the duty on a later increase equals the duty you would have paid up front, so timing does not change the stamp bill. In Karnataka, rounding to each ₹10 lakh or part makes the two step route ₹500 dearer on MCA's figures, and ₹5,000 dearer on the state's current schedule.
In Haryana, Tamil Nadu, Uttar Pradesh, West Bengal and Kerala, MCA's annexure shows no duty on an increase. Kerala is the sharpest case. AoA duty is ₹25,000 at ₹50 lakh, but ₹5,000 at ₹15 lakh with nil on the later increase, so the two step route saves ₹20,000 there.
These are MCA's figures. Karnataka and Maharashtra have since raised their rates. On their current schedules, AoA duty at ₹15 lakh is ₹10,000 in Karnataka and ₹4,500 in Maharashtra, and the increase from ₹15 lakh to ₹50 lakh costs ₹20,000 and ₹10,500. Budget the state figure until your challan shows otherwise. Our company registration cost calculator prices each state for incorporation.
The FDI reporting rules put a clock on the parent's money, and authorised capital decides whether the company can meet it. Under FEMA 395/2019-RB, as amended up to 13 Jun 2026, shares must be issued to the foreign investor within 60 days of receiving the money. If they are not, the money must be refunded within 15 days after those 60 days. The company then reports the issue in Form FC-GPR within 30 days.
| Event | Deadline | Rule |
|---|---|---|
| Remittance reaches the company's bank account | Day 0 | Starts the 60 day clock |
| Shares issued to the foreign parent | Within 60 days of receipt | FEMA 395/2019-RB, Schedule I, Part A, paragraph 2 |
| Refund if shares are not issued | Within 15 days after the 60 days | Same schedule, paragraph 3 |
| Form FC-GPR | Within 30 days of the issue | FEMA 395/2019-RB, regulation 4(1) |
| Declaration of commencement (INC-20A) | Within 180 days of incorporation | Companies Act, 2013, section 10A |
| Form SH-7 after an increase | Within 30 days of the change | Companies Act, 2013, section 64(1) |
Sources: RBI, FEMA 395/2019-RB as amended to 13 Jun 2026; Income Tax Department copy of section 10A; MCA SH-7 instruction kit (read 26 Oct 2026).
Authorised capital is the maximum share capital the company may have. If the parent wires ₹40 lakh into a company with ₹15 lakh of authorised capital, the company can issue at most ₹15 lakh of shares at face value. It must raise its authorised capital and issue the rest inside the 60 days, or send the excess back.
Authorised capital caps the face value of shares, not the price. A premium above face value does not use up headroom. Rule 21 of the FEMA (Non Debt Instruments) Rules, 2019 requires shares taken on subscription to the MoA to be issued at face value. Later issues to a non resident must be priced at no less than fair value. That fair value must be certified by a chartered accountant, a SEBI registered merchant banker or a practising cost accountant.
In our view, a large premium in year one is rarely the simple answer, because the valuation has to support it. Our guide on FEMA pricing for share issues explains the method. The FC-GPR filing guide covers the 30 day report, and the PAS-3 guide covers the allotment return.
Our advice is to raise authorised capital before the money leaves the parent's account. A wholly owned subsidiary can usually do this quickly. Section 101(1) allows shorter notice for a general meeting if a majority of the members consent and they hold at least 95 percent of the paid up voting capital. A parent and its nominee hold all of it between them.
Size paid up capital to the cash the company will spend before its own income arrives. That is a judgement, and it depends on the operating model. A captive service company billing its parent on a cost plus basis needs much less than a company selling to Indian customers.
The bank account comes first. On Krystal7 filings, the bank account opens about 30 calendar days after incorporation, and only then can the parent remit share money. US based signatories can complete their KYC at ICICI Bank's New York branch, which saves a trip. Our guide on the bank account for an Indian subsidiary lists the documents.
Here is a worked example. The figures for salaries, rent and set up spend are assumptions for illustration, not market data.
| Item | Assumption or result |
|---|---|
| Operating model | Bengaluru engineering subsidiary paid by its US parent on a cost plus basis |
| Monthly cost | ₹7,00,000 (four engineers at ₹1,50,000 cost to company each, plus ₹1,00,000 for the office) |
| Billing | The subsidiary invoices at month end and the parent pays 30 days later |
| Months funded before the first receipt | 2, so ₹14,00,000 |
| Set up spend (rent deposit, equipment) | ₹5,00,000 |
| Paid up capital needed in year one | ₹19,00,000 |
| Authorised capital at incorporation | ₹15,00,000, with nil MCA fee |
| Increase before the second remittance | ₹15 lakh to ₹20 lakh: SH-7 fee ₹15,000 plus Karnataka duty of ₹500 on MCA's figures, or ₹5,000 on the state's current schedule |
Sources: assumptions as stated; MCA SH-7 instruction kit, Table 1 and Annexure A (read 26 Oct 2026).
Incorporating straight at ₹20 lakh would have cost ₹66,000 in MCA fees. The two step route costs ₹15,000 and one extra filing. In our view, ₹51,000 is worth one extra filing for most parents.
An increase has three steps. The board calls a general meeting. The members pass a resolution under section 61(1) of the Companies Act, 2013, which needs the articles to permit it. An ordinary resolution is enough unless the articles ask for more. The company then files Form SH-7 within 30 days under section 64(1).
The SH-7 fee is the scale fee on the new capital less the scale fee on the old. Stamp duty on the increase follows the state. If the SH-7 is late, MCA's kit adds 2.5 percent of the fee for each month of delay up to six months. After six months the rate is 3 percent a month.
| Line | Delhi subsidiary | Karnataka subsidiary |
|---|---|---|
| Scale fee on ₹50 lakh (other company scale) | ₹1,56,000 | ₹1,56,000 |
| Less scale fee on ₹15 lakh | ₹51,000 | ₹51,000 |
| SH-7 fee | ₹1,05,000 | ₹1,05,000 |
| Stamp duty on the ₹35 lakh increase | ₹5,250 (0.15%) | ₹2,000 (₹500 per ₹10 lakh or part) |
| Government cost, filed on time | ₹1,10,250 | ₹1,07,000 |
| Extra if SH-7 is one month late (2.5% of the fee) | ₹2,625 | ₹2,625 |
Sources: MCA SH-7 instruction kit, Tables 1 and 3 and Annexure A; MCA e stamp schedule (read 26 Oct 2026).
The Karnataka column uses MCA's annexure. Karnataka's current schedule, in force from 3 Feb 2024, charges ₹5,000 for every ₹10 lakh or part. On that basis the duty on the ₹35 lakh increase is ₹20,000 and the total ₹1,25,000. Budget the higher figure until the challan shows otherwise.
New shares issued after the increase start the FEMA clock again. Each issue to the parent needs its own FC-GPR within 30 days and a PAS-3 return.
For a subsidiary, the fee maths always favours ₹15 lakh plus a later increase, by ₹51,500. So when we advise a higher figure at incorporation, the reason is time or process, not cost. These are the cases where, in our view, it is worth paying.
Sometimes the parent will send more than ₹15 lakh within weeks of the bank account opening, and its own approvals will not allow a general meeting first. In that case, incorporate at the figure it will send. Round it to a level that leaves headroom for the next tranche. The extra fee buys certainty on the 60 day clock.
Some licences need capital before the application. RBI's FAQ on NBFCs, updated on 15 Sep 2026, says a company seeking NBFC registration needs a net owned fund of ₹10 crore from the start. Specialised classes such as NBFC P2P lenders and account aggregators need ₹2 crore.
Even here, the company can incorporate at ₹15 lakh and increase before the capital arrives, and the ₹51,000 saving still holds. We go straight to the higher figure only when the regulator's timetable leaves no room. Where the FDI rules set a minimum capitalisation for a sector, Schedule I of the NDI Rules counts the premium received towards it.
Some parent boards prefer to approve the Indian capital once. If the first year budget is fixed and the board will not meet again for months, we weigh the ₹51,500 against the delay of a second approval. In our view the fee saving usually wins, but it is the parent's call.
Rarely. Lower authorised capital saves only stamp duty, and only in states where the AoA duty grows with capital. In Kerala, ₹10 lakh instead of ₹15 lakh saves ₹3,000 of AoA duty. In Gujarat it saves ₹2,500, and in Delhi ₹750.
Against that, each ₹1 lakh between ₹5 lakh and ₹15 lakh that you leave unused adds ₹3,000 to a subsidiary's later SH-7 fee. Going to ₹10 lakh in Kerala saves ₹3,000 today and costs ₹15,000 at the first increase. We advise a lower figure only when the company will never need more equity, which in our view is uncommon for a subsidiary.
A loan from the parent needs no authorised capital, but it brings its own rules. The Foreign Exchange Management (Borrowing and Lending) regulations were amended by FEMA 3(R)(5)/2026-RB of 9 Feb 2026. Under them, any person resident outside India can lend to an Indian company as an external commercial borrowing (ECB). Loans from a related party lender must be on arm's length terms.
| Point | Shares | Loan from the parent (ECB) |
|---|---|---|
| Uses authorised capital | Yes, at face value | No |
| Main deadlines | Issue within 60 days of receipt; FC-GPR within 30 days of issue | Loan registration number (LRN) before drawdown; Form ECB 2 within 7 days after the month of drawdown or servicing |
| Price | No less than fair value; face value on MoA subscription | In line with market conditions; arm's length for a related party |
| Minimum term | None | Average maturity of 3 years (1 to 3 years for manufacturing borrowers with up to USD 150 million of ECB) |
| Size limit | FDI sector cap | Higher of USD 1 billion of outstanding ECB or total borrowing up to 300% of net worth |
| Money back to the parent | Dividends or a buyback | Interest and repayment |
Sources: RBI, FEMA 3(R)(5)/2026-RB of 9 Feb 2026, Schedule I paragraphs 2, 5, 6, 9, 10 and 16; FEMA 395/2019-RB; NDI Rules, rule 21 (read 26 Oct 2026).
Preference shares and debentures that are not fully and mandatorily convertible count as ECB, not equity. Fully and mandatorily convertible instruments sit on the equity side. Our guide on CCDs and preference shares under FDI covers the difference.
In our view, the first year should be funded with shares. A loan suits a defined capital project with a repayment plan, or a parent that wants a fixed return before profits allow dividends. Our ECB guide covers the filings. If a loan has already been made, our guide on converting a loan into equity covers that route.
| Situation | Our starting authorised capital | Why |
|---|---|---|
| First year equity up to ₹15 lakh | ₹15 lakh | Nil MCA fee and headroom at no cost |
| First year equity above ₹15 lakh, sent in tranches | ₹15 lakh, then an increase before the tranche that needs it | Saves ₹51,500 in MCA fees; a wholly owned subsidiary can meet at short notice |
| One remittance above ₹15 lakh soon after the bank account opens, and no time for a general meeting | The amount to be sent, plus headroom | Protects the 60 day clock |
| NBFC registration to follow | ₹15 lakh, then an increase before the capital arrives, unless the timetable is tight | ₹10 crore net owned fund needed from the start |
| Registered office in Haryana, Tamil Nadu, Uttar Pradesh, West Bengal or Kerala | ₹15 lakh | MCA's annexure shows no stamp duty on a later increase |
| Parent funds mainly through a loan | ₹15 lakh | An ECB uses no authorised capital |
| Foreign founders hold the shares personally, not through a parent | ₹15 lakh | The company may qualify for the small company scale, which makes increases cheaper |
Source: our view, based on the MCA SH-7 fee table, MCA e stamp schedule, FEMA 395/2019-RB and RBI's NBFC FAQ (read 26 Oct 2026).
If you already know your funding plan and need the increase filed on time, our increase in authorised capital service handles the resolution, the SH-7 and the FC-GPR that follows.
No. Neither the Companies Act, 2013 nor the rules set a minimum for authorised capital. The Companies (Amendment) Act, 2015 also removed the minimum paid up capital requirement.
Because ₹15 lakh is the highest authorised capital that pays no MCA registration fee. The saving also survives later increases, because the SH-7 fee deducts the scale fee on the existing ₹15 lakh. For a subsidiary that saving is ₹51,000, plus the ₹500 SPICe+ fee.
Yes. Authorised capital is only the ceiling in the MoA. A company with ₹15 lakh authorised can have ₹1 lakh paid up, and the subscribers must pay for their shares before the INC-20A declaration, within 180 days of incorporation.
It can, but the company cannot issue shares beyond its authorised capital. It must increase authorised capital and issue the shares within 60 days of receiving the money, or refund the excess within the next 15 days. A premium above face value does not use up authorised capital.
The company must refund the money within 15 days after the 60 days end. That rule is in Schedule I, Part A of FEMA 395/2019-RB. A late refund or late issue is a FEMA contravention that may need compounding.
The SH-7 fee for a subsidiary is ₹1,55,000. That is the ₹2,06,000 scale fee on ₹1 crore less the ₹51,000 on ₹15 lakh. Stamp duty is extra: ₹12,750 in Delhi at 0.15 percent of the increase, and nil in Haryana on MCA's annexure.
No. MCA's SH-7 annexure shows nil duty on an increase in Haryana, Tamil Nadu, Uttar Pradesh, West Bengal and Kerala. Delhi, Telangana, Maharashtra, Karnataka and Gujarat charge it on the increase.
No. Section 2(85) of the Companies Act, 2013 excludes holding and subsidiary companies from the small company definition. A company owned by a foreign parent always pays the other company scale above ₹15 lakh.
Not for shares taken by the subscribers to the MoA. Rule 21 of the NDI Rules requires those shares to be issued at face value. Later issues to the parent must be at no less than fair value, certified by a chartered accountant, a SEBI registered merchant banker or a practising cost accountant.
No. An ECB avoids authorised capital but adds its own filings. It needs an LRN before drawdown, an average maturity of at least 3 years in most cases, arm's length pricing and ECB 2 reports. Not using authorised capital is its main advantage.
The law sets only the filing limit: SH-7 within 30 days of the change. A wholly owned subsidiary can hold the general meeting at shorter notice when members with 95 percent of the paid up voting capital consent. The parent's own approvals usually set the pace.
No, in our view. MCA's company data shows authorised and paid up capital side by side, and readers look at the paid up figure. A large authorised figure with a small paid up figure only shows that the founders paid a bigger fee.
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WRITTEN BY
Nihal Srivastava is a co-founder of Krystal7. He leads client delivery and operations, working with foreign founders on India entry, business structuring and cross border compliance.
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IncorporationWhich documents a foreign founder or parent company must notarise, apostille or consularise for an Indian incorporation, with a 13 country route table, the German and UAE exceptions, document age rules and a checklist.
Read the guide ↗ServiceOne Person Company registration in India: DSC, name approval and SPICe+ filing in about 8 to 10 working days. NRIs can register an OPC since April 2021.
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IncorporationWhat section 12 and rule 25 require for a new company's registered office, which address proofs work for homes, rented and co working premises, and how the state, GST and bank checks depend on the same address.
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IncorporationEvery government charge in an Indian incorporation, proved with two real SPICe+ challans: nil MCA fee up to ₹15 lakh, ₹1,000 for the name, ₹143 for PAN and TAN, and stamp duty by state.
Read the guide ↗ServiceRegister your Public Limited Company in India with Krystal7 Consultants. Professional PLC registration services with expert guidance and compliance support.
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Cross-BorderHow a foreign partner sets up a joint venture company in India in 2026. It covers structures, FDI caps, Press Note 3, FEMA pricing, shareholders agreement limits, CCI thresholds, filings, exits and tax, with a 51:49 example.
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IncorporationHow the Registrar tests a proposed company name under section 4 and rules 8, 8A and 8B, how SPICe+ Part A and RUN work, how long a name stays reserved, and the rejection reasons we see most on our filings.
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IncorporationHow a foreign director gets a Class 3 DSC for Indian company filings: the CCA rules, the documents, the video check, personal or organisation certificates, renewal, and when a founder needs no DSC at incorporation.
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Cross-BorderWhat a foreign founder or director may do in India on a business visa or e Business visa, how long each stay lasts, the June 2026 FRRO rule change, payments, employment visa triggers, tax residency and PE.
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Cross-BorderHow a foreign company opens and runs a liaison office in India in 2026: the three year profit and USD 50,000 net worth test, AD bank or RBI approval, permitted work, AAC by 30 September, Form 162, PE risk and closure.
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Cross-BorderWho needs an employment visa in India, the INR 16.25 lakh salary floor, documents the Indian company signs, validity, FRRO registration under the 2025 Rules, director cases, tax, PF and the compounding fees for getting it wrong.
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IncorporationHow a foreign national becomes a director of an Indian company in 2026: the 182 day resident director rule, DIN through SPICe+ or DIR-3, apostille by country, DSC by video, DIR-12 in 30 days and the new three year KYC.
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IncorporationThe structure, steps, licences, costs and transfer pricing model for a foreign parent setting up an Indian software subsidiary or dev center.
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IncorporationHow a foreign parent sets up an Indian manufacturing entity: FDI route, the licence map by authority, honest timelines and the tax position in 2026.
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IncorporationThe FDI position, registration steps, environmental and safety licence map, and costs for foreign investors entering India's chemical sector.
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Cross-BorderThe five types of India advisers compared honestly for foreign founders: who each suits, the questions that expose a bad fit, real fee ranges, and where Krystal7 Consultants fits.
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Country GuidesThe questions global founders actually ask before an India entry: what FEMA compliance means, who is responsible, how registration works from abroad, what it honestly costs, and the calendar that follows.
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IncorporationYes, a foreign-owned Private Limited company can register on Udyam. The revised thresholds, the portal steps, and what changes when the entity has FDI.
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IncorporationThe SPICe+ form on the MCA portal, part by part: name reservation, the Part B fields that cause resubmissions, linked forms, 2026 fees and stamp duty, documents and a realistic timeline.
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IncorporationThe right company registration provider for a foreign founder should assess the investor and proposed activity before quoting the filing. Compare the full scope through banking and investment reporting, the people responsible and the recurring compliance work. A certificate alone does not show that the business is ready to operate.
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IncorporationForeign founders can register a company in India, subject to the proposed activity, investment route and ownership checks. Decide whether you will invest personally or through an existing overseas company before preparing documents. A parent company should use the foreign subsidiary registration service to plan its corporate ownership and reporting.
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IncorporationThe truth about top rated online company registration services in India for 2026: how rankings are made, real costs, 8 to 10 working day timelines, and how to actually choose.
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Cross-BorderChoosing your India entry route in 2026: subsidiary, branch, LO or LLP compared on control, tax, FEMA and speed, with a decision framework for founders.
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Cross-BorderHow India's Production Linked Incentive schemes work in 2026, which sectors they cover, what Uttar Pradesh and Tamil Nadu add, how incentives are taxed under the Income Tax Act, 2025, and a checklist for a foreign manufacturer.
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IncorporationWho qualifies for DPIIT startup recognition under the February 2026 notification, why a foreign subsidiary does not, how to apply on NSWS, the benefits, the section 140 tax holiday and the usual rejection reasons.
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Cross-BorderHow customs duty in India is built from BCD, SWS, AIDC and IGST, how customs values imports from a foreign parent, how the bill of entry works on ICEGATE, and what drawback and advance authorisation save.
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IncorporationHow an Indian company issues shares to foreign investors by private placement under section 42 and rule 14, with PAS-4, the 200 person limit, deadlines, FEMA pricing and FC-GPR.
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Cross-BorderWhich countries have a social security agreement with India, how a certificate of coverage exempts posted workers, how EPFO issues one for Indian staff going abroad, totalisation, PF withdrawal and the 2026 scheme.
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Cross-BorderBengaluru, Hyderabad, Pune or Gurugram for a foreign tech subsidiary: talent, office costs, state IT and GCC policies, professional tax, shops and establishments law, lease stamp duty and a decision table.
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Cross-BorderHow the Budget 2026 data centre tax holiday works under Schedule IV serial 13C, what changed in August 2026, the 15 percent safe harbour, infrastructure status, state policies, power, DPDP localisation and the FDI route.
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Cross-BorderWhat an Indian importer must declare, hold and produce under section 28DA and CAROTAR 2020, how customs verifies a claim, and how it works for imports under the UAE, Australia, UK and EFTA deals.
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Cross-BorderTEPA has applied between India and Switzerland, Norway, Iceland and Liechtenstein since 1 Oct 2025. Tariff cuts, origin proof, the investment goal and how it sits with the DTAAs.
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Cross-BorderHow a foreign group sets up in GIFT IFSC: the IFSCA framework, funds, banking units, leasing, fintech and in house centres, the section 147 tax holiday, currency, FEMA status, approvals, and a Singapore and Dubai comparison.
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Cross-BorderThe 6 Feb 2026 India US framework, the 2025 tariff escalation to 50 percent, what changed after the Supreme Court ruling, and the transfer pricing and customs effects for an Indian subsidiary.
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Cross-BorderWho must register with the FRRO, the 14 day deadline under the Immigration and Foreigners Rules, 2025, e FRRO steps, documents, the certificate of registration, address changes, departure, penalties and the employer's duties.
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Cross-BorderHow a startup moves its holding company from the US or Singapore to India, comparing the inbound merger, share swap and share purchase routes, with FEMA approvals, pricing, shareholder tax, timelines and lessons.
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Cross-BorderThe India EU FTA was concluded on 27 Jan 2026 but is not yet signed or in force. Tariff cuts by sector, the origin rules, services and what it does not change for an EU parent.
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IncorporationHow Indian private companies issue sweat equity shares under section 54 and rule 8, with limits, valuation, lock in, FEMA rules for non residents, tax as a perquisite and ESOP comparison.
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Cross-BorderHow a foreign company sets up an SEZ unit in India: Form F, the Letter of Approval, the bond, net foreign exchange, tax after the section 10AA sunset, GST zero rating, IT units, exit and the 2025 and 2026 reforms.
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Cross-BorderHow a foreign owned Indian company gets an Importer Exporter Code from DGFT, when service exporters need one, the April to June update, deactivation, and the links to customs, GST and FEMA export reporting.
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Cross-BorderHow a foreign parent seconds staff to an Indian subsidiary: the agreement, the real employer test, GST after Northern Operating Systems, PE and TDS after Centrica, payroll and provident fund, with a checklist.
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IncorporationEvery Indian company needs one director who stays in India for 182 days in the financial year. How foreign groups fill the seat, the forms, the liability, the first year rule and the section 172 penalty.
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Cross-BorderHow a foreign group sets up a global capability centre in India, from entity choice and cost plus pricing to the 15.5 percent safe harbour, SEZ or STPI, GST on exports, PE risk, payroll and the yearly filings.
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FEMA & RBIIndia has no direct conversion of a branch or liaison office into a subsidiary. Here are the steps in order, from incorporation and asset transfer at book value to GST, staff, AD bank closure, Form FC-2, PAN and TAN.
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FEMA & RBIHow an Indian subsidiary runs a section 62(1)(a) rights issue for its foreign parent in 2026: offer periods, FEMA pricing on renounced shares, demat, PAS-3 and FC-GPR within 30 days, with a worked example.
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FEMA & RBIHow an Indian subsidiary turns a foreign parent loan, ECB interest, import payables or pre incorporation costs into shares, with the Companies Act route, FEMA conditions, pricing, filings, tax and a worked example.
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FEMA & RBIHow the Overseas Investment Rules and Regulations 2022 work for an Indian company that sets up or buys a foreign entity in 2026: ODI vs OPI, the 400 percent limit, Form FC and UIN, the two layer rule, APR and late fees.
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FEMA & RBIHow a foreign company opens and runs a branch or project office in India in 2026: the eight permitted activities, the profit and net worth test, AD bank approval, the 35 percent tax rate, AAC, FC-3, profit remittance and closure.
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FEMA & RBISOFTEX stopped applying to software exports invoiced from 1 October 2026, when FEMA 23(R)/2026-RB came into force. What to do with September invoices, how the monthly EDF replaces the form, and the nine month realisation rule.
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FEMA & RBISince 1 October 2026 every exporter of services and software files a monthly Export Declaration Form (EDF) under FEMA. Who files it, where, the due dates, the nine month realisation rule and what a missed EDF costs.
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FEMA & RBIThe legal line between FDI and FPI in India: the NDI Rules 10 percent test, SEBI registration, reclassification within five trading days, tax under the Income Tax Act, 2025, reporting and the right route for a foreign parent.
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FEMA & RBIHow FEMA prices shares issued or transferred to non residents in 2026: rule 21 floor and ceiling, who values, DCF, the 90 day report, CCPS and CCD conversion, swaps, angel tax after its repeal, and rule 57 under the Income Tax Act, 2025.
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FEMA & RBIHow an Indian company files PAS-3 when a foreign investor takes shares: the 30 and 15 day clocks, attachments by route, fees, the order with FC-GPR, penalties and fixing a missed return.
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FEMA & RBIWhat RBI purpose codes are, what P0802 and P0807 mean after SOFTEX ended on 1 Oct 2026, the codes for service exports, FDI and payments to a foreign parent, and how to fix a wrong code with your bank.
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FEMA & RBIHow shares of an Indian Private Limited company move between a resident and a non resident in 2026: FEMA pricing, SH-4 and demat, stamp duty, FC-TRS within 60 days, deferred payment, capital gains, TDS and treaties.
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FEMA & RBIWhat a FIRC and an eBRC are, how to get each from your bank and the DGFT portal, the GST refund link, the 2026 FEMA export rules with EDF and nine month realisation, and fixes for missing certificates.
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FEMA & RBIHow an EEFC account works for a foreign owned Indian company or exporter in 2026: the 100 percent credit rule, permitted debits, the monthly conversion rule, interest, GST refunds, worked examples and a checklist.
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FEMA & RBIHow a foreign parent lends to its Indian subsidiary under the 2026 ECB rules: who can lend, the USD 1 billion limit, end uses, Form ECB 1 and ECB 2, late fees, withholding tax and transfer pricing.
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FEMA & RBIWho files the Annual Performance Report for overseas direct investment, the 31 December due date, when unaudited accounts are allowed, how AD banks file it in 2026, and the flat INR 7,500 late fee.
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FEMA & RBIA practical guide for foreign founders on identifying FDI automatic route sectors in India, understanding when government approval applies, and what to confirm before incorporating or accepting investment.
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FEMA & RBIForm FC-GPR, also written FCGPR: what it reports, the 30 day clock from allotment, the FIRMS portal steps through your AD bank, the certificates the form needs, and what a late filing costs.
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FEMA & RBIA practical guide for foreign founders on FDI reporting requirements in India, covering when RBI reporting applies, which filings to prepare, common mistakes, and when to bring in a compliance advisor.
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FEMA & RBIEvery legal route from an Indian subsidiary to its foreign parent with 2026 rates: dividends under treaty, royalties, buyback after April 2026, and the filings banks actually check.
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FEMA & RBIA step by step guide for foreign investors allotting shares in an Indian company: FEMA and Companies Act requirements, Automatic versus Approval Route, FMV pricing under FEMA valuation norms, FC-GPR filing on the FIRMS portal, and the post allotment compliance calendar covering PAS-3, annual return, and FLA.
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FEMA & RBIA practitioner walkthrough of FEMA compounding under the 2024 Rules: PRAVAAH filing, the INR 10,000 fee, penalty caps and the 180 day order timeline.
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FEMA & RBIThe full FDI compliance map for foreign owned companies in India: FC-GPR, FCTRS, FLA, sectoral caps and the penalties for getting reporting wrong.
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FEMA & RBIFC-GPR and FC-TRS are the two FEMA forms every foreign investor in an Indian company eventually meets. This guide sets out the difference between them in one table, explains when each applies, the 30 and 60 day filing clocks, and how to file correctly on the FIRMS portal.
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FEMA & RBIFC-GPR filing for foreign investment in India: the 30 day timeline, FIRMS portal steps, documents, LSF for delays and how to file without rejections.
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FEMA & RBILate or defective FC-GPR? Understand LSF regularisation versus compounding under the 2024 FEMA Rules, the PRAVAAH process, fees and timelines.
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FEMA & RBIHow Indian exporters net export receivables against import payables with the same overseas buyer, supplier or their group companies under FEMA, with the AD bank's role, EDPMS and IDPMS closure, write off limits and documents.
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FEMA & RBIHow FEMA treats OCI cardholders who invest in or direct Indian companies, with repatriation and non repatriation routes, FEMA and tax residence, DIN and KYC, Press Note 3, property and bank accounts.
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FEMA & RBIHow RBI computes the late submission fee for delayed FC-GPR, FC-TRS, LLP, ODI, FLA and ECB filings, the three year window, the cap, how to pay, the 2026 ECB changes and when compounding takes over.
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FEMA & RBIHow foreign partners invest in an Indian LLP under Schedule VI of the NDI Rules, with the sector test, designated partners, pricing, Form LLP(I) and LLP(II), conversion, tax and when an LLP fits.
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FEMA & RBIHow a foreign company merges into an Indian company under section 234 and rule 25A, the 2024 fast track for a foreign parent and its subsidiary, FEMA deemed approval, two year windows, tax and stamp duty.
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FEMA & RBIHow an Indian company pays a foreign supplier or its parent in advance for goods or services under the FEMA import rules in force from 1 Oct 2026, with guarantees, IDPMS, time limits and repatriation.
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FEMA & RBICase note on published RBI compounding orders for late FC-GPR, ARF and FC-TRS reporting and late share issues, with the amounts RBI charged, the compounding matrix, the late submission fee route and what to do now.
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FEMA & RBIHow rule 9(6) of the NDI Rules lets buyers and sellers defer, escrow or indemnify up to 25 percent of the price for 18 months, and how pricing, FC-TRS, escrow accounts, TDS and capital gains timing work.
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FEMA & RBIHow foreign investors fund Indian companies with CCDs, CCPS, warrants and convertible notes, with the NDI Rules, conversion pricing, coupons, tax, FC-GPR, Form CN and company law steps.
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FEMA & RBIThe time limit to realise and repatriate export value under FEMA for goods and services, the 2025 and 2026 changes, EDPMS, extension, set off, reduction and write off, and the GST refund consequences.
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FEMA & RBIHow rule 23 of the NDI Rules treats investment by a foreign owned or controlled Indian company, with the ownership and control tests, caps, pricing, the funds rule, Form DI and the annual auditor certificate.
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FEMA & RBIWhen an Indian company or foreign owned subsidiary must hold a Legal Entity Identifier under RBI rules for cross border payments, bank loans, forex deals and RTGS, and how to get and renew one.
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FEMA & RBIWhat Press Note 3 (2020) requires, the seven countries it covers, the 2026 beneficial owner test, the 10 percent automatic route, DPIIT reporting, approval timelines and the filing steps.
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Transfer PricingHow India taxes a management fee paid to a UAE parent: no FTS article in the treaty, PE risk, TDS and Forms 145 and 146, reverse charge GST, the benefit test, disallowance risks and UAE corporate tax, with a worked example.
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Transfer PricingA practical guide for foreign founders on India's safe harbour rules for transfer pricing, covering when they apply to related party transactions, how they fit into compliance, and what to check before relying on them.
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Transfer PricingWho files Part A and Part B of Form 56, when an Indian subsidiary files Form 58 or the CbC report itself, the 2026 and 2027 due dates, penalties under sections 442 and 459, and two worked examples.
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Transfer PricingA practical guide for foreign founders on when Form 3CEB applies to an Indian entity, what to prepare for the chartered accountant, and how to avoid missed portal actions around transfer pricing reporting.
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Transfer PricingThe six prescribed methods under section 165 of the Income-tax Act, 2025 (formerly section 92C) with a worked example of each, the 1 to 3 percent tolerance range, safe harbour, and Form 3CEB documentation.
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Transfer PricingA practical guide for foreign founders on transfer pricing documentation requirements in India, covering local file, master file, intercompany agreements, benchmarking, and when to bring in an advisor for an Indian subsidiary.
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Transfer PricingCase note on the Delhi High Court rulings that decide management fee disputes for Indian subsidiaries: benefit, duplication, shareholder costs, allocation keys, aggregation, the 2026 safe harbour and the documents that win.
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TaxHow India's thin capitalisation rule works for Indian subsidiaries: section 94B and section 177, the INR 1 crore trigger, the 30 percent of EBITDA cap, guarantees, exclusions, parent ECBs and the carry forward.
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TaxHow an Indian subsidiary buys back shares from its foreign parent under section 68, prices the buyback under FEMA, files FC-TRS, and withholds tax now that buybacks are capital gains again.
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Income Tax & TDSHow the India Mauritius DTAA taxes a Mauritius company in 2026: treaty rates, source taxation of share gains after the 2016 protocol, grandfathering, Article 27A, the 2024 PPT protocol, Tiger Global, TRC and substance.
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Income Tax & TDSHow an Indian company claims credit for tax withheld abroad in 2026: rule 128 and Form 67 for AY 2026-27, rule 76 and Forms 44 and 45 from tax year 2026-27, due dates, documents, disputes and worked examples.
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Income Tax & TDSHow India's General Anti Avoidance Rule works for foreign groups in 2026: Chapter XI of the Income Tax Act, 2025, the INR 3 crore test, grandfathering, the Approving Panel, PPT and LOB, and the substance file.
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Income Tax & TDSHow the India Netherlands DTAA taxes a Dutch company in 2026: 10 percent rates, the MFN clause after Nestle SA, share sales under Article 13(5), PE without a service clause, the MLI and Form 41.
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TaxHow the India Singapore DTAA taxes a Singapore company in 2026: treaty rates, the make available test, capital gains after 2017, Article 24A, the MLI principal purpose test, PE triggers, Form 41 and substance.
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Income Tax & TDSWhen a foreign company becomes tax resident in India under POEM in 2026: section 6(10), CBDT Circular 6 of 2017, the active business test, the INR 50 crore threshold, founder risk and the tax cost.
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Income Tax & TDSHow India taxes RSUs and ESOPs that a foreign parent grants to staff of its Indian subsidiary in 2026: perquisite value under rule 15, TDS, cross charges, FEMA, capital gains, Schedule FA and Form 44.
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Income Tax & TDSHow the India Germany DTAA taxes a German company in 2026: the flat 10 percent rates, managerial fees, the missing service PE rule, capital gains, the MLI position, the Nestle MFN ruling and Form 41.
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Income Tax & TDSHow a foreign company gets a lower or nil TDS certificate in Form 128 under section 395 and rule 213: who can apply, documents, how the officer sets the rate, validity, the payer's Form 144 entry, and a UK SaaS example.
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Income Tax & TDSWhich return a foreign owned company in India files, the extended AY 2026-27 due dates, the ITR-6 schedules foreign owners trigger, the 22 percent regime and MAT credit choice, late filing costs and the move to the 2025 Act.
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Income Tax & TDSHow a foreign company or foreign national gets an Indian PAN in 2026: Form 96 and Form 95 replace Form 49AA, the apostilled registration certificate, fees, the Indian representative, rule 217 relief from higher TDS, and two worked examples.
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Income Tax & TDSHow an Indian subsidiary or a foreign company gets a TAN under section 397 of the Income Tax Act, 2025: Forms 134 and 135, rule 216 timing, documents, the INR 10,000 penalty, and the TDS work that follows.
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Income Tax & TDSHow the India UAE DTAA taxes a UAE company in 2026: who counts as a UAE resident, treaty rates, technical fees without an FTS article, free zone companies, capital gains, the MLI principal purpose test, PE, UAE corporate tax and documents.
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Income Tax & TDSHow the India UK DTAA taxes a UK company in 2026: Articles 11 to 14 rates, the make available test, service PE day counts, capital gains under Indian law, the MLI principal purpose test and Form 41.
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Income Tax & TDSHow the India US tax treaty taxes a US company in 2026: dividend, interest and royalty caps, fees for included services and the make available test, service PE, Article 24 LOB, capital gains, Form 41 and Form 6166.
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Income Tax & TDSWhat a non resident needs to claim treaty rates in India in 2026: the foreign TRC, Form 41 (old Form 10F) filed online, PAN or rule 217 details, validity rules, and Forms 42 and 43 for an Indian company's own TRC.
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Income Tax & TDSSection 63 of the Income Tax Act, 2025 keeps the INR 1 crore and INR 10 crore tax audit limits. See who needs an audit, the FY 2025-26 forms and dates, Form 26 from tax year 2026-27 and the new flat fee.
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Income Tax & TDSA section and form map from the 1961 Act to the Income Tax Act, 2025 for foreign owned subsidiaries, with the FY 2025-26 transition rule, tax year 2026-27 due dates and the 2026 MAT change.
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Income Tax & TDSA practical guide for foreign founders on how permanent establishment risk arises in India through employees, contracts, offices, and vendors, and how to structure India activity to reduce that exposure before scaling up.
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Income Tax & TDSForms 15CA and 15CB became Forms 145 and 146 on 1 Apr 2026. The four parts of Form 145, the rule 220 exemptions, treaty claims, portal steps, penalties and a worked royalty example.
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Income Tax & TDSThe corporate tax rate in India for foreign companies is 35 percent plus surcharge and cess. Full rate table with effective rates, DTAA withholding relief and the subsidiary comparison.
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Income Tax & TDSHow an Indian company deducts tax on royalty, fees, interest and dividends paid abroad in 2026, with section 393 and 207 rates, treaty rates for eight countries, rule 217, Forms 41, 128, 144 and 131, and a US example.
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TaxFor a foreign owned subsidiary, GST is not just registration, it is export refunds, reverse charge and a monthly filing rhythm. Here is a ranked, honest 2026 guide and who each firm suits.
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TaxCross border tax for founders in India: permanent establishment risk, withholding tax, treaty relief and transfer pricing, explained for 2026.
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TaxWhen minimum alternate tax applies to foreign companies and Indian subsidiaries: section 115JB and section 206, the 14 percent final MAT, book profit, the foreign company exclusions, MAT credit and the section 200 choice.
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TaxHow the single tax year in section 3 of the Income Tax Act, 2025 replaces previous year and assessment year from 1 Apr 2026, how returns, advance tax, TDS and assessments are labelled, and how FY 2025-26 income is handled.
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TaxWhy angel tax under section 56(2)(viib) ended from AY 2025-26, which old share issues to foreign investors are still exposed, and the FEMA, Companies Act and income tax rules that still apply.
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TaxAdvance tax for companies in India: the four due dates, the INR 10,000 threshold, section 405 computation, interest under sections 424 and 425 (old 234B and 234C), online payment and a cost plus example.
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TaxThe history of India's equalisation levy, the end of the 2 percent e commerce levy on 1 Aug 2024 and the 6 percent advertising levy on 1 Apr 2025, and the income tax, withholding and GST rules that now apply.
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TaxHow the India Canada DTAA taxes a Canadian parent and its Indian subsidiary: dividend, interest and royalty caps, fees for included services, the related enterprise service PE, capital gains, the MLI and the papers.
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TaxHow the India Australia DTAA taxes an Australian parent and its Indian subsidiary: 15 percent dividends and interest, the royalty bands, management fees, the 183 day service PE, section 11J and ECTA.
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TaxWhen a foreign company is taxable in India: business connection under section 9 of the Income Tax Act, 2025, the INR 2 crore and 3 lakh user SEP tests, agents, treaty PE override, digital businesses and a decision table.
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TaxThe rates, holding period, withholding, treaty exemptions for Mauritius, Singapore and Netherlands sellers, buyer side fair value rules and FEMA reporting when a non resident sells unlisted Indian shares.
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TaxWhat Union Budget 2026 and the Finance Act, 2026 changed for foreign owned Indian companies and non residents: MAT, buy back tax, withholding, transfer pricing, new exemptions, customs, GST and FEMA.
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TaxCase note on AAR v Tiger Global International II Holdings (2026 INSC 60): the facts, the order, grandfathering under Article 13(3A), TRCs, GAAR and what Mauritius and Singapore holding structures should do now.
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TaxHow India decides the tax residency of a foreign employee: the 182 day and 60 plus 365 day tests, not ordinarily resident status, salary for work in India, the 90 day and treaty short stay exemptions, and the papers.
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TaxHow the India France DTAA taxes a French parent and its Indian subsidiary: the 10 percent rates, the MFN clause after Nestle SA, technical fees, PE, the 10 percent share rule, the MLI and Form 41.
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TaxCase note on AO v Nestle SA (2023 INSC 928): why MFN clauses in India's treaties need a notification, what Switzerland, the Netherlands and France did next, and the dividend rates that apply today.
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TaxHow the India Japan DTAA taxes a Japanese parent and its Indian subsidiary: the 10 percent rates, the wide technical fee definition, JBIC and NEXI interest, PE, capital gains, the MLI and Form 41.
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TaxHow Form 27Q works for TDS on payments to non residents, what goes into it, the 31 July to 31 May due dates, Form 131, corrections, late fee and penalty, and the switch to Form 144 under the Income Tax Act, 2025.
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