How Can an NRI Start A Private Limited Company In India?
India’s changing market scenario and the flourishing ecosystem of business opportunities are alluring many to expand their business to India, especially NRIs who see the potential in the developing sectors that are catching colossal momentum. While the thought is there, the reality might be slightly different as the challenges faced by a foreigner in terms of the legalities, compliances and work culture differences while opening a business in India can not be neglected. Seeking expert local help to register your company in India and to get guidance on the other aspect of the business can go a long way in ensuring that your business has the right start.
An individual of Indian birth and origin who resides overseas is called a Non-Residential-Indian. A NRI is a boon for the national economy. NRIs also bring along expertise, technology, a modern and global outlook when setting up companies in India, along with massive inward remittances. Upon realizing ttheirrole in the country’s economic growth, the Indian government has made several administrative changes and provided incentives to encourage business in India.
Multiple investment-boosting schemes have been introduced by both the central government and state governments, including subsidized electricity prices, cost-free land for the establishment of promising enterprises, and even tax subsidies for some time to drive business set up in India.
With simplified procedures and online submission of documents, it has become quite convenient for a NRI to start a business in India. The most sought-after types of companies by NRIs are Private Limited Corporations and Limited Liability Partnerships.
Owing to the nature of its legal and capital requirements, private limited businesses are seen as especially suitable for Non-Resident Indians. Some other interesting features of a Private Limited Company are-
– It has a minimum of 2 members and a maximum of 200.
– There should be at least 2 directors, and one of them must be a current resident of India. They can be the family members or spouses of the overseas director of the company.
– Registered offices must be located in India.
– A prior approval from the Government of India or the Reserve Bank of India is not required.
NRIs need to produce copies of passports and address certified evidence to their respective Indian Embassies, High Commissions or Consulates to complete the procedures mentioned below.
Here are all the important documents to be procured before registering for a Private Limited Company in India-
1. Digital Signature Certificate (DSC)- As per the definition of the Ministry of Corporate Affairs, Digital Signature Certificates (DSC) are the internet equivalent of physical or paper certificates. Drivers’ licenses and passports are some examples of physical certificates. Certificates act as evidence of an individual’s identity for a certain purpose . The directors of the company are required to create and register a digital signature and submit it online.
2. Director’s Identification Number (DIN)- Any individual who has been appointed the director of a company is allotted a unique number of identification, called the Director’s Identification Number (DIN). It is obtained by applying pursuant to section 153 & 154 of the Companies Act, 2013, under Form-DIR 3. The form is digitally signed and must be approved after payment of the necessary fees by a company secretary. DIN is received after the government accepts the DSC.
3. Simplified Proforma For Incorporating Company Electronically (SPICE)- The purpose of a SPICE form is to provide speedy incorporation related services within a restricted time limit which are in line with the best international business practices and policies. This form allows the business name to be pre-approved before applying for registration. The form confirms the commitment of the Government of India to the ease of doing business across borders. The SPICE form would not be able to be used by foreign subscribers to the Memorandum and Articles of Association. By filing separate forms for separate steps, they would be expected to adopt the traditional method of incorporation.
4. PAN and TAN Number– Since a company is a separate legal entity, it needs to have a Permanent Account Number (PAN) and a Tax Deduction and Collection Account Number (TAN) for the purpose of calculating income tax liabilities.India
This is exactly the type of work DBPL can help you with! At DBPL, our specialist team helps you with all processes related to opening your company in India. We help you through national and local regulations and registrations for the formation of the company and the taxation compliance thereof. Besides these, we provide you with our expertise and guidance regarding every aspect of your business, starting from land acquisition to construction and asset management.