How to Set Up a Company in India from Australia (2026) — Complete Guide

By CA Rohit Lohade, KRPR & Associates  ·  Updated May 2026  ·  15 min read

---

1. Why Are Australian Companies Setting Up in India in 2026?

The commercial case for Australian companies entering India has strengthened significantly over the past three years — driven by the ECTA trade agreement, India's growing technology sector, and the scale of the Indian-Australian community creating natural business bridges.

The most common reasons Australian companies establish Indian subsidiaries:

Reason	Detail
Engineering and technology teams	India produces 1.5 million+ engineering graduates annually. A senior software engineer in Bangalore or Pune costs 20–30% of an equivalent hire in Sydney or Melbourne.
Back-office and shared services	Finance, HR, customer support, and operations roles can be built in India at a fraction of Australian cost — with no language barrier and strong English proficiency.
Manufacturing access	India's PLI (Production Linked Incentive) schemes across 14 sectors offer financial incentives for manufacturing — highly relevant for Australian companies in pharmaceuticals, electronics, and food processing.
Market entry	India's consumer market of 1.4 billion — with a growing middle class and rising digital adoption — is increasingly attractive to Australian retail, fintech, and education companies.
Research and development	India offers weighted tax deductions for R&D expenditure. Australian companies building IP can structure India operations to maximise these incentives.
ECTA bilateral trade	The India-Australia ECTA has created new export and import opportunities — making an India entity valuable for Australian companies trading goods between the two countries.

---

2. What Does the India-Australia ECTA Mean for Your India Setup?

The India-Australia Economic Cooperation and Trade Agreement (ECTA), which came into force in December 2022 and reached full implementation in January 2026, is the most significant bilateral trade development between the two countries in decades. DFAT's ECTA overview explains the full scope.

ECTA provision	What it means for your India entity
Tariff elimination on goods	As of January 2026, 100% of Australian tariff lines are at zero duty for Indian exports. Over 85% of Australian goods enter India at preferential rates. If your Indian subsidiary imports Australian components or exports finished goods to Australia, tariff costs are significantly reduced.
Services commitments	ECTA includes market access commitments in IT services, education, professional services, and financial services — directly relevant to Australian companies setting up service delivery entities in India.
Mutual recognition	ECTA includes provisions for professional recognition — relevant if your India entity employs Australian-qualified professionals working alongside Indian staff.
Investment protections	ECTA includes investment protection provisions, adding a layer of bilateral treaty protection for Australian FDI in India above and beyond FEMA regulations.

---

3. What Is the Right Legal Structure for an Australian Company Entering India?

For the vast majority of Australian companies, the answer is a Private Limited Company (Pvt Ltd). Here is a comparison of all options:

Structure	Best for	Key limitation	For Australian companies
Private Limited Company	Tech teams, back offices, manufacturing, trading, market entry	Requires 2 directors, 1 must be India-resident	✅ Recommended for almost all use cases
Branch Office	Limited import/export representation	Higher tax rate (40%), RBI approval required, limited commercial scope	❌ Only for specific trade representation
Liaison Office	Market research only	Cannot earn any revenue	❌ Only for pre-revenue market exploration
Project Office	Single specific contract	Temporary — exists only for duration of project	❌ Narrow use case only
LLP	Professional partnerships	FDI requires government approval — not automatic route	❌ Not suitable for most Australian companies

The Private Limited Company gives Australian companies: 100% ownership under the automatic FDI route, limited liability protecting the Australian parent's assets, full commercial freedom to hire, invoice, and contract, and the lowest effective corporate tax rate of any foreign-owned structure in India.

→ Read our full comparison: Subsidiary vs Branch Office vs Liaison Office in India

---

4. Can an Australian Company Own 100% of an Indian Subsidiary?

Yes — in most sectors. Under India's FDI policy, 100% foreign ownership is permitted under the automatic route (no government approval needed) for:

Sector	Automatic route cap
IT and software services	100%
Manufacturing	100%
Professional services (consulting, CA, legal)	100%
E-commerce (marketplace model)	100%
Education	100%
Healthcare	100%
Infrastructure and construction	100%
Trading and distribution	100%
Insurance	74% (above 74% requires government approval)
Defence manufacturing	74% (above 74% requires approval)
Print media and broadcasting	26–49% (government approval required above that)

You also need to confirm the correct NIC (National Industrial Classification) code for your business activity at the time of incorporation. An incorrect NIC code causes problems during GST registration, FEMA filings, and tax assessments. We verify the right code for every engagement.

→ For the full FDI policy by sector: FEMA & FDI compliance — KRPR's specialist desk

---

5. What Is the Apostille Process for Australian Documents — and Why Does It Take So Long?

This is the most common source of delay in Australia-to-India incorporations. Before any India filing can proceed, all Australian corporate documents must be apostilled by DFAT (Department of Foreign Affairs and Trade).

Australia joined the Hague Apostille Convention in 1994. DFAT is the sole authority for apostilling Australian company documents. There is no shortcut.

What documents need apostilling?

• Certificate of Registration from ASIC (the Australian equivalent of a Certificate of Incorporation)
• Constitution or Memorandum and Articles of Association
• Board Resolution authorising the India subsidiary setup (we prepare the template)
• Certificate of Good Standing or equivalent ASIC extract (dated within 6 months)
• Proof of registered Australian address
• Passports of all Australian directors (certified copy — not apostilled, but notarised)
• Australian address proof for each director (utility bill or bank statement, dated within 2 months)

How long does DFAT apostille take?

DFAT processing option	Turnaround time	Notes
Standard online application (for company documents)	5–10 business days	Most company documents qualify for the online process
Priority service (where available)	3–5 business days	Additional fee applies — worth it to avoid delays
In-person lodgement at DFAT office	Same day or next day	Available at DFAT offices in Canberra, Sydney, Melbourne, Brisbane, Perth, Adelaide

→ DFAT's official apostille application: dfat.gov.au — Apostille and Authentication Services

---

6. What Is the Step-by-Step Process to Incorporate in India from Australia?

Step	Action	Time required
1	Start DFAT apostille process — submit Australian company documents to DFAT immediately	5–10 business days (run in parallel with everything below)
2	Obtain Digital Signature Certificates (DSC) for all directors via video verification — no India travel required	3–5 business days
3	Reserve the company name via MCA SPICe+ Part A — up to two name options per application	2–4 business days
4	File SPICe+ incorporation form with MCA — covers incorporation, DIN, PAN, TAN, EPFO, ESIC, and GST registration	7–10 business days
5	Receive Certificate of Incorporation (CIN) — your Indian company now legally exists	Issued on MCA approval
6	Open corporate bank account — recommended banks for Australian parent companies: HSBC India, HDFC, ICICI	10–15 business days
7	Remit share capital from Australia via SWIFT wire — bank issues a Foreign Inward Remittance Certificate (FIRC)	2–5 business days
8	File FC-GPR with RBI — mandatory within 30 days of share allotment. This is the most commonly missed filing.	Must be filed within 30 days
9	File INC-20A (commencement of business declaration) — mandatory within 180 days. Company cannot commence business without this.	Must be filed within 180 days
10	Complete additional registrations — GST, Professional Tax, EPFO, ESIC, Import Export Code (if relevant), Trade Licence	1–3 weeks

Total elapsed time: 6–8 weeks from engagement to operational bank account with all registrations complete.

→ Full process detail: India subsidiary registration — KRPR's complete service

---

7. What Documents Does an Australian Company Need for India Incorporation?

From the Australian parent company (all must be apostilled by DFAT)

• ☐ Certificate of Registration from ASIC
• ☐ Constitution or Memorandum and Articles of Association
• ☐ Board Resolution authorising the establishment of the Indian subsidiary
• ☐ Certificate of Good Standing or current ASIC extract (dated within 6 months)
• ☐ Registered Australian address proof

From each Australian director (notarised — not apostilled)

• ☐ Passport (valid, colour copy, notarised by an Australian solicitor or Justice of the Peace)
• ☐ Australian address proof (utility bill or bank statement, not older than 2 months, notarised)
• ☐ Email address and Indian mobile number (required for DSC application)
• ☐ Passport-size photograph

From the India resident director

• ☐ PAN card
• ☐ Aadhaar card
• ☐ Address proof (bank statement or utility bill)
• ☐ Passport-size photograph

For the registered office in India

• ☐ NOC from property owner or rent agreement
• ☐ Electricity bill (not older than 2 months)

→ Full documents checklist: Documents required to register a subsidiary company in India

---

8. What Is the Resident Director Requirement and How Does an Australian Company Satisfy It?

Under Section 149(3) of the Companies Act 2013, every Indian company must have at least one director who has resided in India for 182 or more days in the previous financial year. This applies to all Indian companies — including wholly owned subsidiaries of Australian companies.

Australian founders and directors based in Australia do not meet this requirement. The options are:

Option	Suitable when	Key consideration
Appoint an India-based co-founder or senior employee	You already have India-based leadership in place or plan to hire immediately	Ensure governance documents clearly limit their authority if they are not intended to have full commercial control
Appoint a professional nominee resident director	No India-based team initially — lean entity, tech team not yet hired, or trading subsidiary	Must have zero signing authority, undated resignation letter held by Australian parent, and indemnity bond in place

KRPR provides a CA-qualified nominee resident director service — a qualified Chartered Accountant from our team appointed with an undated resignation letter (held by your Australian parent from day one), full authority restriction documentation, and zero commercial signing power.

→ Resident Director Services in India — how KRPR's service works

---

9. What Taxes Does an Indian Subsidiary of an Australian Company Pay?

Tax	Rate	Notes
Corporate income tax (new regime)	22% + surcharge + cess = ~25.17% effective	Applies to most Indian subsidiaries under Section 115BAA
Corporate income tax (new manufacturing companies)	15% + surcharge + cess = ~17.01% effective	Section 115BAB — for new manufacturing entities incorporated after 1 Oct 2019
GST on domestic supplies	5%, 12%, 18%, or 28% depending on goods/services	Export of services to Australia is zero-rated under GST — no GST on service invoices raised to Australian parent
TDS on salary payments	Based on employee's income tax slab	Monthly deduction from salary
TDS on vendor payments	1%–10% depending on payment type	Applies to rent, professional fees, contractor payments
Dividend withholding tax (to Australian parent)	15% under India-Australia DTAA (vs 20% standard rate)	Australian parent must provide Tax Residency Certificate (TRC) to claim treaty rate
Royalty / technical service fee withholding	10% under India-Australia DTAA (vs 10–20% standard)	Applies to payments from Indian subsidiary to Australian parent for IP licences or technical services

---

10. How Does the India-Australia DTAA Reduce Your Tax Exposure?

The India-Australia Double Tax Avoidance Agreement (DTAA) prevents the same income from being taxed twice — once in India and once in Australia. For Australian companies with Indian subsidiaries, the DTAA is relevant in three main situations.

Dividends from Indian subsidiary to Australian parent

Without the DTAA, India levies withholding tax on dividends at 20% plus surcharge and cess. Under the India-Australia DTAA, this is capped at 15%. To claim this treaty rate, the Australian parent must provide a Tax Residency Certificate (TRC) from the Australian Tax Office (ATO) to the Indian subsidiary before the dividend is declared. The Indian subsidiary files Form 15CA and Form 15CB before remitting the dividend to Australia.

Royalties and technical service fees

Payments from the Indian subsidiary to the Australian parent for IP licences, software licences, or technical services are subject to withholding tax in India. Under the DTAA, this is capped at 10% — compared to the standard Indian withholding rate of 10–20% depending on the payment type.

Permanent Establishment (PE) risk

If Australian employees or directors regularly conduct business in India on behalf of the Australian parent — negotiating contracts, taking orders, or making commercial decisions — this can create a "permanent establishment" of the Australian parent in India, making the Australian entity taxable in India on those profits. The DTAA defines when a PE exists and provides a framework for resolving disputes. For Australian companies with Indian subsidiaries, managing PE risk is essential — particularly if Australian leadership visits India frequently or if the Indian subsidiary acts as an agent for the Australian parent.

→ For transfer pricing and intercompany structuring: Transfer pricing advisory — KRPR

---

11. Does Transfer Pricing Apply to Your Australian Parent and Indian Subsidiary?

Yes — from your very first intercompany invoice. Every transaction between the Indian subsidiary and the Australian parent must be priced at arm's length. This includes:

• IT or software development services recharged to the Australian parent
• Back-office or shared services
• Management fees paid to or received from the parent
• Software or IP licences between the entities
• Intercompany loans
• Sale or purchase of goods between related parties

If these transactions exceed INR 1 crore in aggregate, formal transfer pricing documentation is mandatory, including a Form 3CEB signed by a Chartered Accountant, filed annually with the income tax return.

→ Transfer pricing documentation and Form 3CEB — KRPR's specialist desk

---

12. What Ongoing Compliance Does the Indian Subsidiary Need to File?

Monthly filings

Filing	Due date
GSTR-1 (outward GST supplies)	11th of the following month
GSTR-3B (GST summary return)	20th of the following month
TDS payment to government	7th of the following month

Quarterly filings

Filing	Due date
TDS return (Form 24Q / Form 26Q)	31st of the month following the quarter end
Advance tax payment	15th June, September, December, March

Annual filings

Filing	Due date	Australia-specific note
Income tax return	31 October (if TP audit applies) · 31 July otherwise	Coordinate with Australian parent's financial year (July–June)
Transfer pricing return (Form 3CEB)	31 October	Required if intercompany transactions exceed INR 1 crore
Annual Performance Report (APR) to RBI	31 December	Specific to foreign-owned entities — frequently missed, carries significant penalties
FLA Return (Foreign Liabilities & Assets) to RBI	15 July	Specific to foreign-owned entities — frequently missed
Annual General Meeting (AGM)	Within 6 months of financial year end	—
Annual return (MGT-7) to MCA	Within 60 days of AGM	—
Financial statements (AOC-4) to MCA	Within 30 days of AGM	Prepare in Indian GAAP — provide Australian parent with IFRS/AAS reconciliation for consolidation
Statutory audit	Before AGM	Australian parent's auditors will typically request the Indian audited accounts for group consolidation
Director KYC (DIR-3 KYC)	30 September annually	—

→ Monthly accounting and compliance — how KRPR manages this for Australian clients

---

13. What Does It Cost to Set Up and Run an Indian Subsidiary from Australia?

One-time setup costs

Item	INR	AUD (approx.)
Incorporation (government fees + professional fees)	₹1,80,000 – 2,50,000	AUD 3,200 – 4,500
Local registrations (GST, Professional Tax, Trade Licence)	₹80,000 – 1,00,000	AUD 1,400 – 1,800
Accounting and systems setup	₹40,000 – 50,000	AUD 700 – 900
Total one-time setup	₹3,00,000 – 4,00,000	AUD 5,300 – 7,200

Annual ongoing costs

Service	Annual (INR)	Annual (AUD approx.)
Monthly bookkeeping, GST & TDS filing	₹5,40,000	AUD 9,700
Statutory audit	₹2,00,000 – 2,50,000	AUD 3,600 – 4,500
Income tax return	₹80,000 – 1,00,000	AUD 1,400 – 1,800
Secretarial compliance (ROC, AGM, annual returns)	₹60,000 – 80,000	AUD 1,100 – 1,400
Transfer pricing (if applicable)	₹2,50,000 – 3,00,000	AUD 4,500 – 5,400
Nominee resident director (if required)	₹2,40,000	AUD 4,300

AUD conversions approximate at 1 AUD ≈ INR 56. Exchange rates vary.

→ Full cost breakdown with year-on-year projections

---

14. What Official Guides Don't Tell You About Australia-to-India Setups

Most guides cover the apostille and the SPICe+ filing. What they don't cover is what KRPR has learned from advising Australian clients specifically over 15+ years. Here are four things most Australian CFOs and founders don't know until they're in the middle of the process.

Australia's financial year (July–June) creates a compliance mismatch with India (April–March)

India's financial year runs from 1 April to 31 March. Australia's runs from 1 July to 30 June. This creates a timing mismatch that affects when Indian statutory accounts are ready for consolidation into Australian group accounts, when transfer pricing documentation must be prepared, and when the APR and FLA returns (tied to the Indian financial year) fall due. Australian parent companies need to plan for this mismatch from the outset — particularly their auditors, who will expect Indian accounts on a different cycle. KRPR prepares Indian subsidiary accounts on both Indian GAAP and Australian Accounting Standards (AAS) schedules for clients who need it.

The ATO and Indian Revenue can both review the same intercompany transaction

If your Indian subsidiary charges the Australian parent for IT services, both the Indian tax authorities and the ATO can examine that pricing — one to ensure India's tax base isn't being eroded, the other to ensure Australia's isn't. Most India advisors structure TP to satisfy Indian requirements. Most Australian advisors structure it to satisfy ATO guidelines. The overlap is rarely managed. KRPR coordinates both positions in a single intercompany pricing model, documented to withstand scrutiny from both sides.

ASIC-registered company documents have a quirk that Indian authorities sometimes query

Australian companies registered with ASIC issue a single-page Certificate of Registration — not the multi-page "Certificate of Incorporation" that Indian MCA officers expect from UK or US entities. Some MCA officers unfamiliar with Australian corporate documents request additional ASIC extracts or a solicitor letter confirming the document's equivalence. KRPR prepares a supporting declaration for all Australian client incorporations to prevent this from causing delays.

The India-Australia ECTA has created new transfer pricing scrutiny on goods transactions

Since the ECTA reduced tariffs on goods between India and Australia, Indian and Australian tax authorities have both increased scrutiny of goods pricing between related Australian parent companies and Indian subsidiaries. The concern: that companies are manipulating goods prices to shift profits to the lower-tariff jurisdiction. If your Australian entity sells goods to your Indian subsidiary or vice versa, your transfer pricing documentation for goods transactions needs to be particularly robust under the post-ECTA environment.

---

15. Frequently Asked Questions

Can an Australian company own 100% of an Indian subsidiary?

Yes. Under India's FDI policy, Australian companies can own 100% of an Indian private limited company in most sectors under the automatic route — no government approval required. This includes IT, software, professional services, manufacturing, trading, and back-office operations.

Does the India-Australia ECTA affect company registration in India?

ECTA affects tariffs and bilateral trade but does not change the company registration process itself. That is governed by the Companies Act 2013 and FEMA regulations. ECTA has, however, improved the commercial case for Australian companies setting up Indian entities — particularly for manufacturing and IT services.

How long does it take to set up an Indian subsidiary from Australia?

6–8 weeks from engagement to operational bank account, including the DFAT apostille process (5–10 business days), incorporation (7–12 working days), and bank account opening (10–15 business days). The apostille process is the most common cause of delay — start it immediately.

What is the apostille process for Australian companies setting up in India?

All Australian corporate documents used for India incorporation must be apostilled by DFAT. This includes the ASIC Certificate of Registration, company constitution, board resolution, and certificate of good standing. DFAT typically processes apostilles within 5–10 business days. In-person lodgement at a DFAT office can get same-day processing. Director documents (passports, address proof) need notarisation by a JP or solicitor — not DFAT apostille.

What withholding tax applies when an Australian parent receives dividends from India?

Under the India-Australia DTAA, withholding tax on dividends from an Indian subsidiary to an Australian parent is capped at 15%. Without the treaty, the standard rate is 20% plus surcharge and cess. The Australian parent must provide a Tax Residency Certificate from the ATO to claim the treaty rate. Form 15CA and Form 15CB are filed in India before the dividend is remitted.

Do I need to travel to India to set up an Indian subsidiary from Australia?

No. The entire incorporation process is online. DSC is obtained via video verification. Bank accounts can be opened remotely through bank representatives visiting directors in Australia. You can receive your Certificate of Incorporation without travelling to India.

What is the corporate tax rate for an Indian subsidiary owned by an Australian company?

22% under the new regime (Section 115BAA), with an effective rate of ~25.17% after surcharge and cess. New manufacturing companies may qualify for 15% (effective ~17.01%) under Section 115BAB. Dividends remitted to Australia attract an additional 15% withholding tax under the DTAA.

Does transfer pricing apply to an Australian parent with an Indian subsidiary?

Yes. Every intercompany transaction — IT services, management fees, IP licences, goods — must be priced at arm's length. If aggregate transactions exceed INR 1 crore, a Form 3CEB signed by a CA is mandatory. Your TP documentation must also align with Australia's ATO transfer pricing guidelines under Subdivision 815-B of the ITAA 1997.

Can an Australian SMSF invest in an Indian subsidiary?

This depends on your fund's trust deed. SMSFs can hold overseas investments in principle, but private company shares may not qualify under specific fund trust deed restrictions. Obtain advice from your SMSF trustee and Australian tax adviser before using superannuation funds.

What ongoing compliance does an Indian subsidiary of an Australian company need?

Monthly GST returns and TDS payments, quarterly TDS returns, annual income tax return, transfer pricing return (Form 3CEB), Annual Performance Report (APR) to RBI by 31 December, FLA return to RBI by 15 July, ROC annual filings, statutory audit, and director KYC. The APR and FLA returns are specific to foreign-owned entities and are the most frequently missed filings — both carry significant penalties.

---

KRPR & Associates  ·  Chartered Accountants  ·  ICAI Reg. No. 139415  ·  Peer Reviewed  ·  Pune, India  ·  Practicing since 2012