Register a Company in India: Everything You Need to Know

India in 2025 is one of the most promising countries for global business expansion. With its fast-growing economy, investor-friendly policies, and a thriving ecosystem for start-ups, the country has emerged as a global hotspot for innovation and technology. With a huge English-speaking workforce, deep tech talent available, and ease of doing business on the rise, the country is a natural choice for companies wanting to scale.

Whether-it is an international entrepreneur, multinational company, or remote-first startup looking for global growth-the guide walks you through registering your company in India. We cover registration steps, legal criteria, and types of entities, and offer strategic alternatives to help you build a compliant and scalable presence in the country.

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Table of Contents

• Exploring Your Market Entry Options in India
• Business Structures You Can Choose From
• Comparing Business Structure Options
• Step-by-Step Guide to Company Registration in India
• Key Documents Required to Register Your Indian Company
• Post-Incorporation Essentials You Shouldn’t Ignore
• Additional Business Licenses and Registrations You Might Need
• Timeframe to Set Up a Business in India
• What Does It Cost to Incorporate a Company in India?
• Obstacles Global Founders May Face While Setting Up in India
• Incorporating as a Foreign-Owned Company: A Special Path
• Employer of Record: A Simpler Way to Hire in India Without Incorporation
• Why Asanify is the Ideal Partner for Global Companies Entering India
• Summary & Final Takeaways
• FAQs

Exploring Your Market Entry Options in India

You need to consider two main routes when entering the Indian market.:

Incorporating a Local Business Entity

Setting up an entity in India gives you full control over operations, branding, and hiring. This path requires you to get your business entity formally registered with the MCA, comply with Indian laws, open local bank accounts, and hire employees in the company name.

This is an ideal setup for companies with a long-term commitment in India or those wishing to build a larger presence inside India.

Hiring Through an Employer of Record (EOR)

An Employer of Record allows for full-time Indian employees to be hired without having to register a local legal entity. The EOR acts as a legal employer on your behalf, dealing with payroll processing, contracts, taxes, and compliance, while you retain control of the employees’ day-to-day work. 

Hiring through an EOR works well for companies wanting to test the waters of the Indian market, hastily hire, or otherwise make the most of a tight budget. It is swift and flexible and compliant with Indian labor laws from the get-go.

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Business Structures You Can Choose From

One of the most significant strategic choices you'll make when setting up a company in India is choosing the proper legal structure. The structure you select influences everything from flexibility of ownership and exposure to liability to access to funding and compliance requirements.

India provides a range of entity forms that suit various business sizes, objectives, and structures. The following is an in-depth discussion of the most common business structures permitted in India, including which are best suited for foreign investment and scalable ventures.

Sole Proprietorship

A sole proprietorship is the most basic form of ownership of business in India. It is not an independent legal entity; rather, the owner and the business are legally one and the same.

This form is usually taken by small local enterprises or individual freelancers because of the ease of formation, low compliance, and cost. The owner has complete control over the business, all profits go to him or her, and he or she is personally liable for the entire debt and liabilities.

• Best for: Small businesses with low risks operated by Indian residents.
• Foreign Ownership: Not allowed foreign individuals or firms cannot open a sole proprietorship in India.

Traditional Partnership Firm

A partnership firm is a traditional firm that is established when two or more partners agree to divide ownership, profits, and liabilities of a business. This setup is based on the Indian Partnership Act, 1932 and is subject to a partnership deed.

Although easy to set up and run, one major drawback is unlimited liability every partner is liable personally for the debts of the firm. Additionally, the firm cannot be treated as a separate legal entity from the partners.

• Best for: Two or more individuals sharing ownership in small businesses.
• Foreign Ownership: Not permitted except if it is converted into a Limited Liability Partnership (LLP).

One-Person Company (OPC)

Introduced in the Companies Act, 2013, an OPC provides one entrepreneur with the advantages of limited liability and corporate form. It provides enhanced credibility over sole proprietorships and protects personal assets from business risks.

OPCs do have some limitations they cannot raise venture capital, need to become a Private Limited Company once they reach specified financial levels, and foreign ownership is not permitted.

• Best for: Indian resident founders looking for a formal structure with full control.
• Foreign Ownership: Not allowed only Indian citizens can register OPCs

Limited Liability Partnership (LLP)

An LLP merges the business freedom of a partnership along with the protection of limited liability of a company. It is an independent legal entity, where the partners are liable only up to their agreed contributions. LLPs are governed by the LLP Act, 2008.

This model is preferred by professional service firms, consulting firms, and small tech teams. LLPs have foreign partners with some Reserve Bank of India (RBI) and Foreign Direct Investment (FDI) restrictions.

• Best for: Service-oriented companies and companies looking for flexibility without complete corporate compliance.
• Foreign Ownership: Permitted with advance permission in non-restricted industries. 

Private Limited Company (Pvt Ltd)

A Private Limited Company is the most popular business structure among Indian startups and foreign investors. It is a separate legal entity with limited liability, and it allows foreign direct investment (FDI) through the automatic route in most sectors.

Pvt Ltd businesses can raise venture capital, issue stocks, and expand operations efficiently. But they have to go through more formalities like annual audits, board meetings, and Ministry of Corporate Affairs filings.

• Best for: Startups, SMEs, and international businesses setting up long-term Indian operations.
• Foreign Ownership: Allowed under the automatic FDI route in many industries.

Public Limited Company

A Public Limited Company can raise capital in the form of shares offered to the public via Initial Public Offerings (IPOs). It is suitable for large-scale businesses with big operations and expansion projects. This form is strictly regulated by the Securities and Exchange Board of India (SEBI) and has to abide by comprehensive corporate governance regulations.

Whereas public companies provide more access to capital, they are subject to heavy compliance requirements, financial disclosures, and oversight. 

• Suitable for: Large-scale businesses seeking to list in the public market and raise capital.
• Foreign Ownership: Permitted, subject to sectoral FDI caps and public shareholding requirements.

Comparing Business Structure Options

Business Structure	Legal Status & Liability	Best Suited For	Foreign Ownership
Sole Proprietorship	Not a separate legal entity; owner and business are one. Owner has unlimited liability.	Small local businesses, freelancers, Indian residents with low risk.	Not allowed
Traditional Partnership	Formed under Partnership Act, 1932. Partners share ownership, profits, and unlimited liability.	Two or more individuals running small businesses.	Not allowed (unless converted to LLP)
One-Person Company (OPC)	Separate legal entity with limited liability for one founder. Higher credibility than proprietorship.	Solo Indian entrepreneurs seeking limited liability and control.	Not allowed (only Indian citizens)
Limited Liability Partnership (LLP)	Separate legal entity with limited liability up to partner’s contribution. Flexible compliance.	Service firms, consulting, small tech startups.	Allowed with RBI/FDI restrictions
Private Limited Company (Pvt Ltd)	Separate legal entity with limited liability. Can raise funds, issue shares. Higher compliance.	Startups, SMEs, and global businesses expanding in India.	Allowed (FDI permitted under automatic route in many sectors)
Public Limited Company	Separate legal entity, can raise funds via public IPOs. Heavy compliance under SEBI.	Large-scale businesses planning public listing and expansion.	Allowed (subject to sectoral FDI caps and regulations)

How to Choose the Right Business Model for Your Operations

Selecting the right business structure is not a one-size-fits-all decision. It depends on operational realities, financial goals, liability preferences, and long-term strategies. Below are the key factors you should evaluate before finalizing your company’s legal form in India.

1. Business Size and Stage

Your choice often depends on whether you are just starting out or building for scale:

• Solo entrepreneurs or small ventures: A Sole Proprietorship or One-Person Company (OPC) works well due to their simplicity and low compliance.
• Growing service-oriented teams: A Limited Liability Partnership (LLP) offers flexibility while ensuring limited liability.
• Startups and global ventures: A Private Limited Company (Pvt Ltd) is the most suitable, especially if you foresee international expansion or fundraising.

2. Nature of Operations

The type of business activity also shapes the ideal structure:

• Professional services or consulting: LLPs or Traditional Partnerships allow for collaborative decision-making.
• Product-driven businesses: A Private Limited Company is best, as it supports equity investment and structured ownership.

3. Liability Appetite

How much personal risk are you willing to assume?

• Unlimited liability models: Sole Proprietorship and Traditional Partnerships make owners personally responsible for debts and obligations.
• Limited liability models: LLPs, OPCs, and Pvt Ltd companies protect personal assets, making them more secure for risk-bearing operations.

4. Investment and Fundraising Requirements

If external funding is part of your roadmap, structures differ significantly in their eligibility:

• Private Limited Companies: Eligible for venture capital, angel investment, and equity financing.
• Public Limited Companies: Ideal for large-scale fundraising through Initial Public Offerings (IPOs).
• LLPs: Limited fundraising potential; cannot issue equity shares, which makes them less attractive to investors.

5. Long-Term Growth Strategies

Think beyond setup and consider future scalability and compliance:

• High-growth, investor-backed businesses: A Pvt Ltd Company is future-proof and investor-friendly.
• Stable, low-compliance ventures: An LLP is suitable for firms without aggressive scaling or fundraising plans.

Step-by-Step Guide to Company Registration in India

After selecting your business structure, the next thing to do is go through the legal registration process. Here's how to register a company in India step by step:

Define Your Company Type

Choose whether you're registering a Private Limited Company, LLP, OPC, or other structure. This will decide the compliance requirements, ownership rules, and documentation required for your application.

Select a Unique Company Name

Select a name that is representative of your brand and follows the Ministry of Corporate Affairs (MCA) naming conventions.

Check for availability and reserve the name using the RUN (Reserve Unique Name) or SPICe+ service on the MCA portal.

Apply for Digital Signature Certificates (DSC)

All directors and authorized signatories need to acquire DSCs to electronically sign documents. This is a compulsory process in filing online incorporation forms

Obtain Director Identification Numbers (DIN)

DINs are distinctive IDs given to all directors. Apply for DIN via the SPICe+ form or independently if you already possess an approved name and company structure.

Reserve Your Company Name with the Registrar

Reserve your company name officially through the MCA's RUN or SPICe+ Part A service. Name reservation is usually 1–3 business days when all the requirements are fulfilled.

File the Incorporation Application via SPICe+

SPICe+ form is a combined, single-window form that deals with:

• Registration of a company
• Issue of PAN and TAN
• EPFO/ESIC registration
• GST registration (optional)
• Opening of a bank account

Complete Part A (reservation of name) and Part B (company details, director details, registered office address, etc.) to make your application.

Draft and Upload MOA & AOA

Upload Memorandum of Association (MOA) and Articles of Association (AOA), describing your company's aim, rules of operation, and governance structure.

Pay Filing Fees and Receive Certificate of Incorporation

Once all forms and documents are submitted, pay the government fees online. Upon approval, you’ll receive the Certificate of Incorporation (COI), which legally recognizes your company under Indian law.

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Key Documents Required to Register Your Indian Company

Prior to registering your company in India officially, you will need to make a list of documents that are mandatory. These need to be submitted to the Ministry of Corporate Affairs (MCA) in order to confirm the identity, residence, and purpose of all concerned stakeholders such as directors, shareholders, and the company.

The following is the list of essential documents you'll require:

Identity Proof of Directors and Shareholders

All suggested directors and shareholders are required to present a valid identification document. For Indian citizens, it can be a PAN card, Aadhaar card, or passport. A passport is required for foreign nationals or non-residents. The documents should be clear, recent, and if foreign notarized/apostilled as applicable if in a foreign language, translated into English.

Proof of Residential Address

Address verification for every director and shareholder is necessary. Acceptable documents are bank statements, utility bills, or government-issued address proof, dated within the past 60 days. The document should clearly show the person's name and full residential address.

Passport-Size Photographs

All directors must submit high-resolution passport-sized digital photographs. These are used in various government forms and internal company records. Ensure that the background is plain and the image quality meets official standards.

Office Address Documentation

Your registered office must be documented at the time of incorporation. You’ll need to provide:

• A rent agreement or property ownership proof
• A recent utility bill (electricity/water/gas)
• A No Objection Certificate (NOC) from the owner of the property, in the event the premises are leased

These documents should have the same address as your incorporation forms and should be dated within a span of two months.

Standard Declarations & Consents

A few MCA-recommended forms will need to be signed and filed along with your registration:

• DIR-2: Consent of Director to serve on the board of the company
• INC-9: Subscribers' declaration of compliance with the law
• Any further declarations based on your company type and industry

These declarations are obligatory to prove transparency and legal intent.

Post-Incorporation Essentials You Shouldn’t Ignore

After your company has been registered, there are many post-incorporation activities you need to perform to become fully operational and compliant in India. These activities are important for handling taxes, finance, and legal compliance right from the beginning.

Get Your Company’s PAN

The Permanent Account Number (PAN) is a 10-digit unique identification number provided by the Indian Income Tax Department. It is essential for all tax-related activities in India, including opening bank accounts, issuing invoices, and financial reporting. It is usually auto-generated during incorporation when you file the SPICe+ form.

Register for TAN

A Tax Deduction and Collection Account Number (TAN) needs to be obtained if your business is going to deduct taxes at source (TDS) which is the case when remitting employee salaries, contractors, or suppliers. This helps in maintaining compliance with Indian taxation and enables you to pay TDS to the government.

Open a Corporate Bank Account

You will need to open a separate business bank account in the company's name to make financial transactions. Banks will mostly need your Certificate of Incorporation, PAN, proof of company address, and authorized signatory documents. This account will be employed for operational expenses, investments, and salaries.

Complete GST Registration

If your business exceeds the annual revenue threshold (presently ₹40 lakhs for most companies), or involves interstate commerce, you need to register for the Goods and Services Tax (GST). GST registration applies to certain business categories like e-commerce or export/import services as well.

File RBI Declarations (if foreign investment is involved)

If your firm has been subject to foreign direct investment (FDI), you have to comply with the guidelines of FEMA (Foreign Exchange Management Act) by making filings such as FC-GPR to the Reserve Bank of India (RBI). These filings record foreign capital inflow and also guarantee compliance.

Non-compliance or delays will attract penalties, so it's very important to make all the filings within deadlines. 

Additional Business Licenses and Registrations You Might Need

In India, registering your company is just the first step. Depending on your business sector, size, and activities, you may also need to obtain additional licenses and registrations to remain fully compliant. Below are some of the most common ones:

1. Shops & Establishment License

• Purpose: Mandatory for all physical business premises such as offices, retail stores, and warehouses.
• Authority: Issued by the local municipal council.
• Compliance Role: Ensures employee rights, working hours, leave policies, and workplace safety are properly maintained.

2. Import Export Code (IEC)

• Purpose: Required for any business engaged in importing or exporting goods and services.
• Authority: Granted by the Director General of Foreign Trade (DGFT).
• Compliance Role: Enables international trade by allowing customs clearance and banking for cross-border transactions.

3. EPF & ESIC Registration

• Applicability: Mandatory if you employ 10 or more workers (varies slightly by state and industry).
• Employees’ Provident Fund (EPF): Provides retirement and pension benefits to employees.
• Employees’ State Insurance Corporation (ESIC): Offers health and medical insurance for employees and their dependents.

4. Professional Tax Registration

• Purpose: Levied by certain state governments on salaried employees, professionals, and business owners.
• Compliance Role: Employers must deduct this tax from employee salaries and remit it to the respective state authority.

5. Udyam Registration (for MSMEs)

• Purpose: Designed for Micro, Small, and Medium Enterprises.
• Compliance Role: Grants access to government schemes, incentives, subsidies, and easier loan approvals.

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Timeframe to Set Up a Business in India

With the advent of online filing systems like SPICe+, India’s company registration process has become much faster and more transparent. Assuming your documents are in order, here's a realistic timeline for incorporating a company:

Step	Estimated Duration
Apply for DSC and DIN	2–3 business days
Reserve Company Name (via RUN/SPICe+)	1–2 business days
File Incorporation via SPICe+	3–5 business days
Total Time to Register	10–15 business days

Delays may occur if documents are incomplete, attestation for foreign nationals is pending, or MCA queries are raised.

What Does It Cost to Incorporate a Company in India?

In India, incorporation costs are comparatively less, especially when compared to other major global economies. However, their amount varies with respect to the structure chosen for your business, capital requirements, and whether you use professional help or not.

Here's a typical breakup of incorporation costs in India: 

• Government Fees: These fees are levied on the basis of your Authorized Capital. For capital of under ₹10 lakh, fees would usually be quite nominal in the ₹1,000–₹7,000 range.
• Digital Signature Certificate: Around ₹1,000–₹2,000 per director. 
• Stamp Duty: Varies from state to state and also varies with capital structure. 
• Professional Service Charges: In case of hiring CA/CS, or an incorporation consultancy, charges would depend upon the complexity of work, ranging somewhere between ₹5,000-20,000. 
• Optional Registrations: GST, EPF, IEC, any other registrations, etc., would cost a few thousand more.

Obstacles Global Founders May Face While Setting Up in India

India offers immense opportunities for global businesses, but navigating its regulatory and compliance landscape can be challenging especially for founders unfamiliar with local rules. Below are some of the most common hurdles foreign founders encounter:

1. Document Attestation and Notarization

• Requirement: Shareholders and directors outside India must provide documents such as passports, address proofs, and identity verification.
• Process: These documents often need apostille certification or consular attestation to be valid in India.
• Challenge: If documents are in a language other than English, certified translations are required, adding time, costs, and administrative complexity.

2. Regulatory Confusions in Certain Sectors

• Industries Affected: Fintech, education, insurance, e-commerce, and other regulated sectors.
• Problem: These industries operate under evolving regulations and sector-specific restrictions.
• Impact: Determining what activities are permissible under Foreign Direct Investment (FDI) rules often requires legal expertise and detailed compliance checks.

3. Language and Document-Formatting Concerns

• Requirement: All corporate filings with the Ministry of Corporate Affairs (MCA) must be in English.
• Challenge: Mistakes in translation, formatting, or discrepancies in names and addresses across documents can delay incorporation.
• Impact: Even minor clerical errors may result in rejected filings or prolonged approval timelines.

4. Ensuring Compliance from a Distance

• Key Compliance Areas: Regular filings with the Registrar of Companies (ROC), Goods and Services Tax (GST) returns, and RBI submissions for foreign investments.
• Challenge: Managing compliance without a physical office or local staff can be difficult.
• Solution: Engaging a qualified Chartered Accountant (CA), Company Secretary (CS), or a trusted Employer of Record (EOR) partner is often necessary to ensure smooth operations.

Incorporating as a Foreign-Owned Company: A Special Path

Foreign entrepreneurs and overseas firms wishing to have a foothold in India find that there are special legal avenues through which full or partial ownership is possible while still adhering to Indian law. Based on your desired level of participation and business objectives, you have three main options to pick from:

Wholly-Owned Subsidiary

This is the most popular pathway for overseas businesses intending to penetrate India in its entirety with complete control over operations. A wholly-owned subsidiary functions as a separate legal entity and enjoys the same operational rights as any Indian company. It allows 100% foreign direct investment (FDI) in most sectors, though some industries are restricted or regulated and require prior government approval.

Liaison Office

A liaison office is a representative office used to communicate between the parent company and Indian stakeholders. It **cannot carry out any commercial or revenue-generating activity**. It's mostly employed for market research, publicity of the business of the parent company, or export/import-related activity coordination.

Branch Office

A branch office can carry certain commercial operations but remains an extension of the parent company. It may provide services, perform research, or market products, but it's restricted in scope and requires Reserve Bank of India (RBI) approval.

FDI Caps and Regulatory Approvals

Foreign Direct Investment in India is regulated by sector-specific ceilings called sectoral caps. For instance:

• E-commerce (B2C): Not allowed unless some conditions are fulfilled.
• Telecom: Maximum 100% FDI allowed, but over 49%, approval from the government is required.
• Financial services, defense, insurance, and media: Generally need extra scrutiny and approvals.

In many cases, incorporating as a foreign entity will require filings and approvals from both the Reserve Bank of India (RBI) and the Ministry of Corporate Affairs (MCA). These ensure the company complies with the Foreign Exchange Management Act (FEMA) and other sector-specific laws.

It is a complicated route to go through, hence why most foreign founders hire incorporation consultants or Employer of Record (EOR) partners who can help facilitate effortless compliance and setup.

Employer of Record: A Simpler Way to Hire in India Without Incorporation

An Employer of Record (EOR) enables global companies to hire employees in India quickly and compliantly without setting up a local entity. The EOR becomes the legal employer, handling payroll, benefits, and compliance, while you retain control over daily operations.

Key Benefits of Using an EOR in India:

• Hire talent in days without incorporation delays or costs.
• Test the Indian market or run short-term projects with minimal risk.
• Ensure compliance with employment contracts, PF, ESI, gratuity, and tax regulations.
• Avoid risks of worker misclassification and labor disputes.
• Focus on operations while the EOR manages HR, payroll, and statutory obligations.

Useful resources on statutory benefits in India (PF & ESI):

• Employees’ Provident Fund Organisation (EPFO)
• Employees’ State Insurance Corporation (ESIC)

Why Asanify is the Ideal Partner for Global Companies Entering India

If you're considering expanding to India, whether through full incorporation or flexible hiring, Asanify has an end-to-end solution designed specifically for global companies. We know both the strategic and regulatory ins-and-outs of operating in India, allowing you to get past the typical pain points that global founders experience.

For companies willing to establish a legal presence, we lead you through the entire incorporation process: from selecting the appropriate structure and registry with the Ministry of Corporate Affairs to obtaining local tax registrations and post-incorporation compliance. If you're not yet ready to incorporate, our Employer of Record solution allows you to legally employ Indian talent in just days, without the headaches of payroll, benefits, or compliance documents.

Asanify has supported clients across the United States, Europe, the Middle East, and Southeast Asia. Whether you’re a startup hiring your first remote developer or a multinational opening a regional office, our local legal experts, transparent pricing, and integrated HR tools ensure that your India expansion is fast, compliant, and stress-free.

Summary & Final Takeaways

Growing into India holds great promise but selecting the appropriate entry route is vital. Many international companies will be deciding between two options: incorporating a legal entity (like a Private Limited Company or LLP) or employing through an Employer of Record (EOR).

If you're establishing a long-term footprint, raising capital, or seeking complete operational control, organizing a registered company might be the most suitable option. Conversely, if your ambitions involve rapid entry to markets, testing operations, or adding a small team without legal baggage, an EOR enables you to act quickly, without sacrificing compliance.

FAQs

 

Not to be considered as tax, legal, financial or HR advice. Regulations change over time so please consult a lawyer, accountant  or Labour Law  expert for specific guidance.