Foreign Subsidiary in India

Enter the Indian market with a fully compliant subsidiary. AVS & Associates handles foreign subsidiary setup — incorporation, FDI under FEMA, RBI filings and ongoing compliance.

Foreign Subsidiary in India

Establishing Your Indian Subsidiary

Global companies entering the Indian market most commonly do so by setting up a foreign subsidiary — an Indian company in which the overseas parent holds shares. A foreign subsidiary in India enjoys the same legal standing as any domestic company, can conduct full commercial operations, and offers limited liability and a clear corporate structure. The investment is governed by FEMA and the RBI’s foreign direct investment framework, which determines whether approval is needed and what compliances follow.

AVS & Associates manages the entire journey for international clients — from incorporation through FDI reporting to ongoing tax and statutory compliance.

The foreign company certificate of incorporation

Incorporation and FDI Compliance

Most sectors allow foreign investment through the automatic route, while some require government approval and several have sectoral caps.

  • Incorporation of a private limited company under the Companies Act, 2013
  • Structuring shareholding within the applicable FDI route and sectoral caps
  • Reporting share allotment to the RBI through Form FC-GPR
  • Annual FLA return and ongoing FEMA reporting
  • PAN, TAN, GST and bank account setup for operations

Operating Compliantly After Setup

Once incorporated, a foreign subsidiary must meet the same ROC and tax obligations as any Indian company, plus additional RBI and FEMA filings tied to its foreign shareholding, such as the annual FLA return. Transfer pricing rules also apply to transactions with the parent and group entities. We provide a single point of accountability for all of this, so your India operation runs cleanly while you focus on the business.

From market entry to steady-state compliance, we make India straightforward for global companies.

Transfer Pricing and Repatriating Profits

A foreign subsidiary’s transactions with its overseas parent and group companies — for services, royalties, loans or shared costs — fall under India’s transfer pricing rules and must be conducted at arm’s length, with documentation maintained and, above thresholds, an accountant’s report filed. This is a frequent area of scrutiny and a common source of disputes for multinationals in India.

We help structure inter-company arrangements to be defensible, maintain the required documentation, and advise on the most tax-efficient compliant routes to repatriate profits — whether by dividend, royalty or service fee — coordinated with the applicable tax treaty and withholding requirements. The objective is an India operation that is both compliant and efficient for the global group.

A Single Point of Accountability in India

From market entry through steady-state operations, we are one accountable team for your Indian incorporation, FDI and RBI reporting, tax, transfer pricing and ongoing ROC compliance. Global companies value not having to coordinate several local vendors across functions — your India operation runs cleanly while your team focuses on the business itself.

Inbound setups commonly pair with a private limited company registration, optional company registration in Dubai from India, ROC compliance & annual filings and virtual CFO services.

Why Select Us?

Our Strength Lies in Providing Real-World Practical Solutions

STRICT TIMELINE

We incorporate and file FC-GPR and the annual FLA return within RBI and MCA timelines, keeping your Indian entity compliant from day one.

MINIMUM COST

Transparent setup and compliance fees, with one coordinated team replacing several local vendors and their overlapping costs.

ONE STOP SOLUTION

Incorporation, FDI and RBI reporting, tax, transfer pricing and ROC compliance — your India operation managed end to end.

TRUST & RELIABILITY

AVS & Associates is a peer-reviewed CA firm founded by CA Vishnu Agrawal, with 25+ years of experience and five partners. We uphold the highest ethical and professional standards on every engagement, with complete client confidentiality.

Frequently Asked Questions​

It is an Indian company in which a foreign parent holds shares, allowing the overseas business to operate in India as a full-fledged domestic company with limited liability.

It depends on the sector. Many sectors permit foreign investment through the automatic route, while some require government approval or are subject to sectoral caps under the FDI policy.

FC-GPR is the reporting filed with the RBI when an Indian company issues shares to a foreign investor. It must be filed within the prescribed timeline after allotment.

Beyond standard ROC and tax filings, a foreign subsidiary must meet RBI and FEMA obligations such as the annual FLA return, and comply with transfer pricing rules on group transactions.

In many sectors, 100% foreign ownership is permitted under the automatic route. Sectoral caps and approval requirements apply to certain industries, which we assess upfront.