India Company Formation |
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India company formation is an ideal way for international entrepreneurs to conduct business in one of the world's most rapidly growing economies in recent years. The following will help you determine whether India company formation is the optimum corporate structure to fulfill your international business objectives. |
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Advantages of India Company Formation |
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India company formation allows entrepreneurs to be legitimately tax-exempt for the first five years of operation of their company, and 50% tax-exempt for the next five years if the company is set up in one of India's Special Economic Zones. For more information on incentives for India company formation, kindly visit Healy Consultants' India Company Incorporation page.
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India is a popular business outsourcing location due to the wide availability of low cost, English-speaking labour. 100% foreign ownership is permitted with India company formation. |
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An Indian company accesses double taxation treaties with approximately 70 countries including Australia, Canada, China, Japan, New Zealand, Russia, Singapore, South Korea, Thailand, the UK and the US to support India company formation. |
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Following India company formation, Healy Consultants will open a corporate bank account with one of the world's leading retail banks, including HSBC, Standard Chartered and Citibank.
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Disadvantages of India Company Formation |
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India company formation is challenging due to complex bureaucracy and regulations. According to the World Bank's Doing Business 2011 Survey, India ranks poorly at 134th for its ease in which to do business in. The survey measures factors including business start up procedures, time, cost and minimum capital required to start a business. In addition, India is negatively ranked as the world's 95th least corrupt country in the 2011 Corruption Perceptions Index by Transparency International, a global measure of corruption amongst public officials and politicians.
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A minimum paid up capital of INR100,000 (US$2,228) is required for India company formation. In the event that the company uses words such as India or Hindustan in its name, then the minimum paid up capital requirement will be INR 500,00(US$11,140). |
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A minimum of two shareholders and two directors is required with India company formation. The directors and shareholders need not be resident in India. Corporate directors are not permitted and a public register is available, giving details of shareholders and directors. |
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Domestic corporations are subject to tax at a basic rate of 35% and a 2.5% surcharge. Foreign corporations have a basic tax rate of 40% and a 2.5% surcharge. In addition, an education cess at the rate of 2% on the tax payable is also charged. Corporates are subject to wealth tax at the rate of 1%, if the net wealth exceeds Rs.1.5 mn ( appox. $ 33,420). |
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Following India company formation, it is necessary to prepare and submit annual audited financial statements and file tax returns with the Indian government and tax authorities.
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Indian companies are subject to foreign exchange controls. According to the Heritage Foundation's 2011 Index of Economic Freedom India is ranked very poorly for having the world's 124th-freest economy, and scores at 53.4% in terms of investment freedom and capital flows. The survey is a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets.
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According to the World Economic Forum's 2009-2010 Network Readiness Index, India has the world's 43rd most developed information communications technology (ICT) infrastructure. The World Economic Forum also ranks India a poor 56th on its Global Competitiveness Report 2011-2012. |
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Contact Us
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For additional information on India company formation, contact email@healyconsultants.com or telephone us in Singapore at (+65) 6735 0120. |
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Back to Asia Pacific Company Incorporation page. |
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