Starting a Company in India as a Foreigner or NRI

Are you a foreign national or a Non-Resident Indian (NRI) who wants to register a company in India? That’s great news!

India has a huge market, lots of skilled people, and the government is making it easier for foreigners to invest. But honestly, understanding the process can feel confusing—like trying to solve a puzzle blindfolded.

That’s why Trustlink is here to help you. This guide will walk you through everything step by step.

What You’ll Learn

This guide covers:
✅ Legal rules
✅ Types of companies
✅ Registration steps
✅ Documents you need
✅ Tax and compliance
✅ Common mistakes to avoid

Why Foreigners and NRIs Are Investing in India

• Huge number of customers

• Skilled and affordable workforce

• Growing sectors like fintech, e-commerce, and manufacturing

• Friendly startup policies

Legal Rules for Foreign Company Registration

Before you start, you should know the main authorities:

• Companies Act, 2013
  Main law for company formation and management.

• FEMA (Foreign Exchange Management Act)
  Governs flow of foreign money in and out of India.

• RBI (Reserve Bank of India)
  Sets rules for foreign investment and sending money abroad.

Types of Business Entities You Can Choose

You can set up different types of companies:

1. Private Limited Company

   • Most popular choice

   • Limited liability (your personal assets are safe)

   • Separate legal identity

2. Limited Liability Partnership (LLP)

   • Fewer compliance rules

   • Not ideal if you want venture capital funding

3. Branch Office

   • An extension of a foreign parent company

   • Follows RBI guidelines

4. Liaison Office

   • Acts as a communication channel

   • Cannot do commercial business

5. Project Office

   • For carrying out a specific project in India

Why Most Foreigners Pick a Private Limited Company

✅ 100% foreign ownership allowed in many sectors
✅ Easy to raise funds
✅ Limited liability
✅ Tax benefits

Important Features

• At least 2 directors (one must live in India)

• No minimum capital needed

• Can grow easily

Who Can Be Shareholders

NRIs and foreigners can own 100% shares in a Private Limited Company.

Minimum Requirements

• 2 Directors (1 resident in India)

• 2 Shareholders

• Registered Office Address in India

How to Register Step by Step

Step 1: Get Digital Signature Certificate (DSC)
Like an online signature for directors.

Step 2: Get Director Identification Number (DIN)
Unique ID for each director from the Ministry of Corporate Affairs.

Step 3: Name Approval (RUN Service)
Reserve your company name online.

Step 4: File SPICe+ Form
Main application form for incorporation, PAN, TAN, and GST.

Step 5: PAN, TAN & Bank Account
After incorporation, get your tax IDs and open a business bank account.

Documents You Need

For Foreign Directors:

• Passport (notarized and apostilled)

• Address proof (utility bill or bank statement)

• ID proof

For NRIs:

• PAN Card

• Passport & Visa

• Overseas address proof

For Registered Office in India:

• Rent agreement or ownership proof

• No Objection Certificate (NOC) from owner

• Utility bill

Tax Details

Corporate Tax:

• Domestic company: 22% (without exemptions)

• Foreign company: 40% (plus surcharge and cess)

Double Taxation Avoidance Agreement (DTAA):
India has agreements with 80+ countries to avoid double taxation.

Foreign Direct Investment (FDI) Rules

• Automatic Route: No special approval needed.

• Government Route: Need government approval.

Examples:

• E-commerce: 100% FDI allowed under automatic route

• Defence: 74% automatic, beyond that needs approval

Compliance After Registration

1. ROC Filings
   Annual returns and other forms to Registrar of Companies.

2. Annual Returns
   Forms MGT-7 and AOC-4 are mandatory.

3. Statutory Audit
   Appoint an auditor within 30 days of incorporation.

Opening a Bank Account

• Banks follow strict RBI KYC norms for foreigners.

• Usually takes 7–15 working days.

Common Problems

• Language barriers and complex paperwork

• Delays due to missing or wrong documents

Professional Help

Trustlink recommends:

• Hiring a Chartered Accountant or lawyer

• Using online platforms like IndiaFilings, Vakilsearch, or LegalWiz for easy registration

Tips for Smooth Registration

Do:
✅ Hire professionals
✅ Prepare all documents in advance

Don’t:
❌ Assume all sectors allow 100% foreign ownership
❌ Ignore compliance after registration

Fast-Tracking Registration

• Make sure your documents are clear and complete.

• Pick a unique company name to avoid rejections.

Conclusion

Setting up a company in India as a foreigner or NRI is completely possible if you follow the right steps. With the correct structure, documents, and compliance, you can tap into India’s booming market.

Trustlink is here to make your journey easy, clear, and successful.

FAQs

Q: What is the minimum capital needed?
A: No minimum capital required for a Private Limited Company.

Q: Can a foreigner be the only director?
A: No. You must have at least one Indian resident director.

Q: Do I need to be physically present?
A: Not always. Most of the process can be done online.

Q: How long does it take to register?
A: Usually 10–20 working days if documents are correct.

Q: Can I send profits abroad?
A: Yes, but you must follow RBI and FEMA rules and pay taxes.