How to Register a UK Company in India? Registering a UK company in India involves a detailed process governed by the Indian regulatory framework. The Companies Act, 2013, and the Foreign Exchange Management Act, 1999 (FEMA) provide the legal foundation for foreign entities establishing their presence in India. The first step is to obtain approval from the Reserve Bank of India (RBI) for setting up a branch office, liaison office or project office. This is followed by registration with the Ministry of Corporate Affairs (MCA), where the foreign entity must submit various documents, including a notarized and apostilled copy of the company’s charter documents.
Once the initial registration is complete, the next step involves complying with local laws and regulations to set up the business operations. This includes obtaining necessary licenses and permits, such as Goods and Services Tax (GST) registration, Importer Exporter Code (IEC) if involved in international trade and other sector-specific approvals.
How to Register & Set Up a UK Company in India
Registering a UK company in India involves a series of legal and regulatory steps to ensure compliance with Indian laws. This process includes selecting the appropriate business entity type, obtaining necessary approvals from the Reserve Bank of India (RBI) for certain offices and adhering to Foreign Direct Investment (FDI) regulations. In this article, we’ll explore how to register a UK company in India.
1. Choose the Type of Entity
Choosing the right type of entity is a critical first step for a UK citizen starting a business in India. Each entity type serves different business needs and comes with specific regulatory requirements.
- Liaison Office (LO): A Liaison Office acts as a communication channel between the parent company and Indian companies. LOs cannot undertake any commercial, trading or industrial activities directly or indirectly and cannot earn income in India.
- Branch Office (BO): A Branch Office is suitable for foreign companies that want to undertake commercial activities in India.
- Project Office (PO): A Project Office is established to execute specific projects in India. POs are temporary establishments and must be closed once the project is completed.
- Wholly Owned Subsidiary (WOS): A Wholly Owned Subsidiary is a company entirely owned by the foreign parent company. This setup is suitable for companies looking to have full control over their operations in India.
- Joint Venture (JV): A Joint Venture is a partnership between a foreign company and an Indian company. It leverages the strengths of both entities.
2. Obtain Approval from the Reserve Bank of India (RBI)
If you are setting up a Liaison Office (LO), Branch Office (BO) or Project Office (PO) in India, obtaining approval from the Reserve Bank of India (RBI) is mandatory. This step involves submitting an application along with the necessary documentation to the RBI through an Authorized Dealer bank.
The application form, known as Form FNC (Foreign National Company), is required for setting up a LO, BO, or PO in India. This form is available on the RBI’s website and needs to be submitted through an Authorized Dealer bank. The completed Form FNC, along with all the required documents, must be submitted to the Authorized Dealer bank. The bank will review the application and forward it to the RBI.
3. Incorporation of a Company
Once you have decided on the type of entity and obtained the necessary RBI approvals (if applicable), the next step is to incorporate the company in India under the Companies Act, 2013. This process involves several stages, from obtaining Digital Signature Certificates (DSCs) to receiving the Certificate of Incorporation. Steps to register a UK company in India:
3.1. Obtain Digital Signature Certificate (DSC)
DSC is required for the proposed directors to sign electronic documents during the company incorporation process, one of the director must be an Indian resident. Approach a Certifying Authority (CA) licensed under the Information Technology Act, 2000, such as eMudhra. Submit the required documents, including identity proof and address proof to obtain the DSC.
3.2. Apply for Director Identification Number (DIN)
DIN is a unique identification number for directors. Apply for DIN using Form DIR-3 on the MCA portal. The proposed directors need to provide their identity proof, address proof and a photograph.
3.3. Name Approval
Secure a unique name for your company. Apply for name approval using the RUN (Reserve Unique Name) service on the MCA portal. The application allows you to propose two names in order of preference. Ensure the proposed names are not identical or similar to existing company names. The MCA will approve the name if it meets the criteria.
3.4. Preparation of Incorporation Documents
Forms to File
- Form SPICe+ (INC-32): Integrated web form for incorporating a company electronically. It includes details of the company, directors, subscribers, and registered office.
- eMoA (INC-33) and eAoA (INC-34): Electronic forms for the Memorandum of Association and Articles of Association, respectively.
Supporting Documents
- Identity and address proof of all directors and subscribers.
- Proof of registered office address (rent agreement, utility bill, etc.).
- Declaration by the first director(s) and subscriber(s) in Form INC-9.
- Specimen signature in Form INC-10 (if applicable).
- Pay the applicable registration fees online through the MCA portal.
3.5. Obtain a Certificate of Incorporation
If everything is in order, you will be issued with the Certificate of Incorporation and the company will be officially registered.
3.6. Post-Incorporation Compliance
- File INC-22 to verify the registered office address within 30 days of incorporation.
- File Form INC-20A within 180 days of incorporation. This is mandatory for companies having share capital and requires a declaration that the subscribers have paid the value of shares agreed to be taken by them.
- Open a bank account in the name of the company using the Certificate of Incorporation, PAN and board resolution.
4. Foreign Direct Investment Compliance
After incorporating a UK company in India, ensuring compliance with Foreign Direct Investment (FDI) regulations is crucial. This involves checking sectoral caps and determining whether the investment falls under the automatic or government route. For sectors under the automatic route, no prior approval is needed, whereas sectors under the government route require approval from the relevant ministry. Companies must report the issue of shares to foreign investors using Form FC-GPR within 30 days and file an annual return on foreign liabilities and assets. Additionally, compliance with sector-specific guidelines and maintaining proper documentation are essential to avoid penalties and ensure smooth operation
5. Registration with Tax Authorities
Once your UK company is incorporated in India and has complied with Foreign Direct Investment (FDI) regulations, the next step is to register with various tax authorities. This step ensures that your company complies with Indian tax laws and can engage in financial transactions legally.
5.1. Permanent Account Number (PAN)
PAN is a unique identification number assigned to all taxpayers in India. It is mandatory for conducting any financial transactions, filing income tax returns, and opening a bank account.
- Apply for PAN using Form 49A, available on the Income Tax Department’s website or through authorized PAN service centers.
- Submit the application along with proof of identity, address and date of birth of the directors and the company’s Certificate of Incorporation.
- The PAN card is usually issued within 15 days of application.
5.2. Tax Deduction and Collection Account Number (TAN)
TAN is required for entities that are responsible for deducting or collecting tax at source (TDS/TCS). It is necessary to remit the deducted tax to the government and file TDS returns.
- Apply for TAN using Form 49B, available on the NSDL website or through authorized TAN service centers.
- Submit the application with the necessary documents, including proof of identity and address of the company.
- The TAN is usually issued within 15 days of application.
5.3. Goods and Services Tax (GST) Registration
GST is a comprehensive indirect tax levied on the manufacture, sale, and consumption of goods and services across India. Any business involved in the supply of goods or services must register for GST.
- Apply for GST registration on the GST portal by filling out Form GST REG-01.
- Submit the application along with required documents, including PAN, proof of business registration, address proof of the business premises, and identity proof of the promoters/directors.
- The GST registration certificate is issued within 7 working days of application.
Final Thoughts
UK citizens starting a business in India involves several meticulous steps, including selecting the appropriate business entity, securing RBI approvals for certain types of offices, complying with FDI regulations, incorporating the company and completing tax registrations. Each step is crucial to ensuring your business operates legally and efficiently within India’s regulatory framework. By understanding and following these procedures, UK citizens starting a business in India can effectively tap into the Indian market, fostering growth and expanding their global footprint.
Start Your Business Journey in India Today
To start a business in India from the UK can be challenging making professional legal assistance essential. Burgeon Law’s expertise can streamline the process, ensuring compliance and minimizing potential pitfalls. Their in-depth knowledge and experience help foreign businesses establish a strong foundation in India, saving time and reducing stress. To learn more visit our Setting up in India service page.
FAQs
1. How to register a UK company in India?
To register a UK company in India, select the entity type (Liaison Office, Branch Office, Project Office, Wholly Owned Subsidiary, or Joint Venture). Obtain RBI approval for LO, BO, or PO by submitting Form FNC and necessary documents. For WOS or JV, incorporate under the Companies Act, 2013, by getting a Digital Signature Certificate (DSC), Director Identification Number (DIN) and name approval through the MCA portal.
2. What types of business entities are available for UK entrepreneurs in India?
To register a company in India from UK, you can set up various types of business entities in India, including a Liaison Office (LO) for market research and communication without commercial activities, a Branch Office (BO) for conducting trading, consultancy, and other commercial operations, a Project Office (PO) for executing specific projects, a Wholly Owned Subsidiary (WOS) where the foreign company owns 100% of the Indian entity, and a Joint Venture (JV) which involves partnering with an Indian company to leverage local expertise
3. What documents are required to register a UK company in India?
To register a company in India from UK following documents are required:
- Memorandum and Articles of Association (MoA and AoA) of the parent company, notarized and apostilled.
- Board Resolution authorizing the establishment of the Indian entity.
- Power of Attorney in favor of the local representative, notarized and apostilled.
- Audited Financial Statements of the parent company for the last three years.
- Digital Signature Certificate (DSC) for the proposed directors.
- Director Identification Number (DIN) for the proposed directors.
- Identity and Address Proof of the directors and subscribers.
- Proof of Registered Office Address in India (such as a rent agreement or utility bill).
4. What are the key challenges of registering a UK business in India?
Register a UK company in India presents several key challenges, including navigating complex regulatory approvals such as obtaining RBI clearance for Liaison, Branch, or Project Offices, and complying with the Foreign Direct Investment (FDI) regulations that vary by sector and investment route (automatic or government). Additionally, the documentation process is stringent, requiring notarized and apostilled documents, and coordination between multiple regulatory bodies like the Ministry of Corporate Affairs (MCA) and sector-specific authorities.
5. How long does it take to register a company in India from the UK?
Registering a UK company in India typically takes between 4 to 6 weeks. This timeline includes obtaining necessary approvals such as RBI clearance for certain types of offices, securing Digital Signature Certificates (DSC), Director Identification Numbers (DIN), name approval through the MCA portal, and filing incorporation documents. Delays can occur due to the need for notarized and apostilled documents, sector-specific regulatory approvals, and ensuring compliance with FDI regulations
6. How does Burgeon Law assist UK companies in registering a company in India?
Burgeon Law assists in registering a UK company in India by providing comprehensive legal support throughout the process. This includes advising on the appropriate type of entity to establish, obtaining necessary approvals from the Reserve Bank of India (RBI), and ensuring compliance with Foreign Direct Investment (FDI) regulations. They handle the preparation and filing of incorporation documents, securing Digital Signature Certificates (DSC) and Director Identification Numbers (DIN), and navigating sector-specific regulatory requirements.
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