How to Set Up a Company in India from the USA: The US Subsidiary Guide
US subsidiary setup in India means incorporating a Private Limited Company wholly owned by your US parent. The realistic timeline is four to six weeks, and no travel to India is required at any stage. The bottleneck is not Indian registration — it is apostilling your US corporate documents, which takes three business days to three weeks depending on your state.
| Recommended structure | Private Limited Company (wholly owned subsidiary) |
|---|---|
| Realistic timeline | 4–6 weeks from start to operational bank account |
| Travel to India | Not required at any stage |
| Foreign ownership | 100% permitted under the automatic route in most sectors |
| Minimum capital | No statutory minimum. ₹1 lakh (approx. USD 1,200) is a practical starting point |
| Governing law | Companies Act, 2013; FEMA, 1999; Non-Debt Instruments Rules, 2019 |
| Regulators | Ministry of Corporate Affairs, Reserve Bank of India, Income Tax Department |
US subsidiary setup in India: which entity structure should a US company choose?
For nearly every US company, the answer is a Private Limited Company held as a wholly owned subsidiary — usually abbreviated to WOS. It is India's closest equivalent to a US subsidiary corporation: a separate legal person with its own PAN, bank account and filings, and limited liability that ring-fences the American parent from Indian liabilities.
A wholly owned subsidiary means the US parent holds effectively 100% of the Indian company's share capital. Because Indian law requires a minimum of two shareholders, one share is typically held by a nominee shareholder on the parent's behalf, with a declaration of beneficial ownership recording that the US parent is the real owner. This is standard practice for foreign-owned Indian companies and does not dilute the parent's control.
The alternatives are narrower than they appear. A liaison office cannot earn revenue at all and exists only for market research and representation. A branch office can trade but carries higher tax exposure and treats the US parent as directly present in India. A Limited Liability Partnership cannot easily accommodate equity investment or an ESOP pool, which rules it out for most venture-backed companies.
| Structure | Can earn revenue | Foreign ownership | Best suited to |
|---|---|---|---|
| Private Limited Company | Yes | 100% in most sectors | Almost all US companies — engineering centres, GCCs, sales entities, delivery operations |
| Limited Liability Partnership | Yes | 100% in permitted sectors | Professional services with no equity-raising or ESOP plans |
| Branch office | Yes, restricted scope | N/A — extension of parent | Narrow, project-specific activity |
| Liaison office | No | N/A — extension of parent | Market research only, with no commercial activity |
Under India's Foreign Direct Investment policy, a US company can own 100% of an Indian Private Limited Company under the automatic route in most sectors — including software, IT services, professional services, back-office operations, engineering and most manufacturing. No prior government approval is needed. A minority of sectors, such as defence, broadcasting and multi-brand retail, sit under the government route or carry equity caps, so the sector position should be confirmed before incorporation rather than after.
Apostilling your US documents — the real bottleneck
Document legalisation is the step that determines your total timeline, and it happens entirely in the United States before anything begins in India. The Registrar of Companies cannot verify a Delaware certificate directly, so your US corporate documents must carry an apostille certifying they are genuine.
The United States is a party to the Hague Apostille Convention, so US documents take the apostille route rather than Indian embassy attestation. State-issued and notarised documents are apostilled by the Secretary of State of the issuing state. Federal documents go to the US Department of State, Office of Authentications.
Processing times vary widely by state, and this is where most projects lose weeks.
| State | Typical processing | Practical note |
|---|---|---|
| Delaware | 3–5 business days | Fastest common jurisdiction; most parent entities are here |
| Wyoming | 3–5 business days | Comparable to Delaware |
| California | 10–15 business days | Expedited options usually available for an additional fee |
| New York | 10–15 business days | County clerk authentication may be required first |
| Federal documents | Varies significantly | US Department of State, Office of Authentications, Washington DC |
Documents your US parent must apostille
- Certificate of Incorporation of the US parent company
- Memorandum and Articles of Association, or the US equivalent charter documents and bylaws
- Board resolution authorising incorporation of the Indian subsidiary and naming the authorised representative
- Proof of the US parent's registered office address
- Passport copies of each proposed foreign director — notarised; personal documents generally do not require apostille
Start the apostille process on day one, before any Indian step. Companies that treat it as a later administrative task routinely add three to four weeks to the project. If your parent is incorporated in a slower state, that alone can be the difference between a five-week and a nine-week timeline.
The Indian resident director requirement
Every Indian company must have at least one director who has stayed in India for 182 days or more during the financial year. This requirement comes from Section 149(3) of the Companies Act, 2013, and it is measured against the Indian financial year, which runs 1 April to 31 March.
A US-based founder will not meet this test on day one. The standard solution is appointing a resident nominee director alongside the US directors, under a signed indemnity agreement that limits the appointee to a compliance role with no operational or financial authority. The Indian company also needs a minimum of two directors and two shareholders; where the US parent holds effectively all the equity, a single nominee shareholder holds one share on the parent's behalf.
KRPR & Associates provides resident director services for foreign-owned Indian subsidiaries where the parent has no qualifying individual available.
The incorporation process, step by step
Once apostilled documents reach India, the process is entirely digital and runs through SPICe+, the unified incorporation form filed with the Ministry of Corporate Affairs.
Every proposed director needs a Digital Signature Certificate to sign Indian government filings electronically. Issuance is completed by email and video verification, with no travel required. Allow two to three business days.
Name approval is sought from the Ministry of Corporate Affairs. A US parent holding a matching registered trademark has a materially stronger claim. Submit two strong options rather than one — generic and descriptive names are frequently rejected, and each rejection costs several days.
The Memorandum and Articles of Association are filed along with the apostilled parent documents. The same form covers Director Identification Numbers, PAN, TAN, and EPFO and ESIC registration. This is a single consolidated filing rather than a sequence of separate applications.
The Registrar of Companies issues the Certificate of Incorporation along with the company's PAN and TAN. At this point the Indian company legally exists as a separate person from the US parent.
A current account is opened with an Indian bank. Directors complete KYC remotely by video verification. Banks vary considerably in how quickly they onboard foreign-owned entities, and this step is frequently underestimated — budget one to three weeks and start it immediately after incorporation.
The US parent wires the initial share capital to the new Indian account, quoting the correct purpose code. The receiving bank issues a Foreign Inward Remittance Certificate. This certificate is required evidence for the FEMA filing that follows and should be obtained at the time, not retrieved months later.
The board allots shares to the US parent, and Form FC-GPR is filed with the Reserve Bank of India through the FIRMS portal via the company's Authorised Dealer bank. The deadline is 30 days from the date of allotment.
The declaration of commencement of business, Form INC-20A, must be filed within 180 days of incorporation. GST registration, professional tax and any sector-specific registrations are completed alongside it.
Funding the company and filing Form FC-GPR
Form FC-GPR is the filing US companies most often miss, and the deadline is misunderstood more often than any other date in the process. The 30 days run from the date shares are allotted, not from the date the wire arrives in the Indian bank account. Companies that assume the clock starts at remittance frequently discover the deadline has already passed.
Where the filing is late, the delay is regularised through a Late Submission Fee rather than immediate penalty proceedings. Under RBI Circular RBI/2022-23/122, the fee is calculated as ₹7,500 plus 0.025% of the amount involved multiplied by the number of years of delay, rounded upwards to the nearest month. The fee is capped at the amount involved in the delayed reporting, and the option is available for up to three years from the due date. Beyond three years, a compounding application to the Reserve Bank becomes necessary.
Shares must also be issued at or above fair market value, supported by a valuation certificate. KRPR & Associates issues registered valuer valuation reports and manages FEMA and FDI compliance for foreign-owned Indian entities.
What it costs
Setup costs divide into three categories. Government and third-party fees are broadly predictable. Professional fees vary with scope and structure. Ongoing compliance is the larger long-term figure and the one most often left out of first-year budgets.
| Item | Indicative cost | Notes |
|---|---|---|
| US apostille | Varies by state | Expedited processing available in most states at additional cost |
| Digital Signature Certificates | Per director | Required for every proposed director |
| MCA government fees and stamp duty | Varies by state and authorised capital | Stamp duty is a state subject and differs across India |
| Registered office address | Varies | A shared-office agreement is acceptable for incorporation |
| Initial paid-up capital | ₹1 lakh suggested (approx. USD 1,200) | No statutory minimum; further capital can be remitted later |
| Professional fees — incorporation | Scope-dependent | Request a written, itemised quote before engaging any advisor |
| Annual compliance | Scope-dependent | Accounting, payroll, audit, tax and FEMA filings |
Be cautious of fixed all-inclusive quotes that do not separate government fees from professional fees, and of any timeline that omits the apostille and bank account steps. A quote promising incorporation in seven to fifteen days is measuring only the SPICe+ filing window, not the process a US company actually experiences.
Annual compliance calendar
A foreign-owned Indian subsidiary carries a heavier reporting load than a domestically held company, because FEMA filings sit on top of ordinary corporate and tax compliance. The two filings specific to foreign ownership — the FLA return and the Annual Performance Report — are also the two most frequently missed.
| Filing | Frequency | Due |
|---|---|---|
| GST returns | Monthly | Per GST calendar |
| TDS payment | Monthly | Per Income Tax calendar |
| TDS returns | Quarterly | Per Income Tax calendar |
| FLA return to RBI | Annual | 15 July |
| Annual Performance Report to RBI | Annual | 31 December |
| Income tax return | Annual | Per Income Tax calendar |
| Transfer pricing report, Form 3CEB | Annual | Where international related-party transactions exist |
| Statutory audit and ROC annual filings | Annual | Per Companies Act timelines |
| Director KYC | Annual | For every director |
| Board meetings | Minimum four per year | Not more than 120 days between consecutive meetings |
Where the Indian entity provides services to its US parent, those services are generally treated as zero-rated exports under GST, provided payment is received in foreign exchange and the two entities are not merely establishments of the same legal person. Registration may still be required even where the tax liability on those exports is nil.
What the US parent must file
Setting up in India creates reporting obligations on the US side as well, and these are the ones most India-focused guides omit entirely. A US parent holding an Indian subsidiary should expect to address, with its US tax advisors:
- Form 5471 — information return for US persons with respect to certain foreign corporations, generally required for a controlled foreign corporation
- GILTI and Subpart F — the US anti-deferral regime can bring Indian subsidiary earnings into US taxable income, which affects how profits are structured and repatriated
- FBAR / FinCEN Form 114 — reporting of foreign financial accounts above the applicable threshold
- FATCA reporting — including Form 8938 where applicable, under the India–US intergovernmental agreement
- Transfer pricing documentation on both sides — Indian requirements under Form 3CEB and US requirements must describe the same intercompany arrangement consistently, or both tax authorities have grounds to challenge
Dividend repatriation, royalty payments and fees for technical services from the Indian subsidiary to the US parent carry Indian withholding tax, and the applicable rate depends on whether treaty relief is claimed and properly documented. This is covered in detail in our India–US Double Tax Treaty guide.
Delaware, Wyoming and California parents: what changes
The state your US parent is incorporated in does not change what India requires, but it changes how long the process takes and how the structure is documented. India cares about the parent's legal existence and its authority to invest, not about which state issued the charter.
Three practical differences follow from the state of incorporation:
- Apostille speed. Delaware and Wyoming typically process apostille requests in three to five business days. California and New York routinely take 10 to 15 business days. This is the single largest timeline variable in the entire project.
- Document naming. India's Registrar of Companies expects a Memorandum and Articles of Association. A Delaware C-Corp supplies its Certificate of Incorporation and bylaws instead. These are accepted as equivalents, but they should be presented and certified correctly rather than left for the Registrar to interpret.
- Cap table alignment. Where the US parent is venture-backed, the Indian subsidiary sits below the parent on the group structure and must not be capitalised in a way that conflicts with existing investor rights or an ESOP pool. Structuring the Indian entity before checking the parent cap table creates problems that are expensive to unwind.
A Delaware C-Corp, a Wyoming LLC and a California corporation can each own 100% of an Indian Private Limited Company. Where the US parent is an LLC rather than a corporation, the treaty and US tax analysis differs meaningfully, and the position should be reviewed with your US tax advisors before the Indian entity is capitalised.
The five mistakes we see most often
1. Starting the apostille process too late
Treated as paperwork rather than a critical path item, apostille delays routinely add three to four weeks. Begin before any Indian step.
2. Misreading the FC-GPR deadline
The 30-day clock runs from share allotment, not from receipt of funds. Companies that assume otherwise regularly find the window closed.
3. Missing INC-20A
The declaration of commencement of business must be filed within 180 days of incorporation. It is easy to overlook in the period between incorporation and the first month of trading.
4. Paying Indian staff from the US parent
Compensating people working in India directly from the US entity creates payroll, withholding and permanent establishment exposure. Indian employees should be on Indian employment contracts, paid by the Indian company through a compliant Indian payroll.
5. Deferring transfer pricing to year two
Intercompany arrangements are far harder to document defensibly after the fact than at the point of establishment. The transfer pricing position should be set when the entity is built, not when the first Form 3CEB falls due.
Frequently asked questions
How long does it take to set up a company in India from the USA?
Four to six weeks is realistic from start to an operational bank account. Indian incorporation itself takes roughly 15 to 20 business days once documents are ready. The variable is the US apostille, which takes three business days in Delaware or Wyoming and 10 to 15 business days in California or New York.
Do I need to travel to India to register the company?
No. The entire process is completed remotely. Digital Signature Certificates are issued by video verification, incorporation is filed electronically through the SPICe+ form, and Indian banks complete director KYC by video call. Only physical apostilled documents need to be couriered to India.
Can a US company own 100% of an Indian subsidiary?
Yes, in most sectors. Under India's Foreign Direct Investment policy, 100% foreign ownership is permitted under the automatic route for software, IT services, professional services, back-office operations, engineering and most manufacturing. No prior government approval is required. Some sectors carry equity caps or require approval, so confirm your sector before incorporating.
Does India require a local director?
Yes. Section 149(3) of the Companies Act, 2013 requires at least one director who has stayed in India for 182 days or more during the financial year. Most US companies appoint a resident nominee director under an indemnity agreement limiting them to a compliance role with no operational authority.
What is Form FC-GPR and when is it due?
Form FC-GPR reports the issue of shares to a foreign investor to the Reserve Bank of India, filed through the FIRMS portal via your Authorised Dealer bank. It is due within 30 days of the date shares are allotted — not from the date funds are received. This distinction causes more missed deadlines than any other.
What happens if I miss the FC-GPR deadline?
The delay can be regularised through a Late Submission Fee under RBI Circular RBI/2022-23/122, calculated as ₹7,500 plus 0.025% of the amount involved multiplied by the years of delay. The fee is capped at the amount involved. This option is available for up to three years, after which a compounding application is required.
Is there a minimum capital requirement?
No statutory minimum applies to most sectors. In practice, ₹1 lakh — approximately USD 1,200 — is a workable starting point for paid-up capital. Additional working capital can be remitted later as further share capital or through intercompany arrangements permitted under RBI norms.
Do I have to charge GST on services billed to my US parent?
Services exported to a US parent are generally treated as zero-rated supplies under GST, provided payment is received in foreign exchange and the entities are not merely establishments of the same legal person. GST registration may still be required, but tax liability on those exports is typically nil.
What is a wholly owned subsidiary in India?
A wholly owned subsidiary is an Indian Private Limited Company whose entire share capital is held by a foreign parent. Because Indian law requires two shareholders, one share is held by a nominee on the parent's behalf with a beneficial ownership declaration. The parent retains full control and the subsidiary remains a separate legal person.
Can a Delaware C-Corp own an Indian subsidiary?
Yes. A Delaware C-Corp, a Wyoming LLC or a California corporation can each own 100% of an Indian Private Limited Company. The state of incorporation does not change India's requirements, but it affects apostille processing time and how the parent's charter documents are presented to the Registrar of Companies.
What is the difference between a US subsidiary in India and a branch office?
A subsidiary is a separate Indian legal person, so liabilities stay ring-fenced from the US parent and it can trade freely. A branch office is an extension of the US parent itself, carries a narrower permitted scope of activity and higher tax exposure, and does not provide liability separation. Almost all US companies choose a subsidiary.
Should I use an Employer of Record instead of incorporating?
An Employer of Record suits teams of roughly one to five people. Past eight to ten employees the monthly markup generally exceeds the fixed cost of running your own entity, and an EOR cannot invoice Indian customers or cleanly hold intellectual property. Where proprietary IP is being built, a subsidiary is usually preferable regardless of headcount.
What ongoing filings does a US-owned Indian subsidiary have?
Monthly GST returns and TDS payments, quarterly TDS returns, an annual income tax return, statutory audit, ROC annual filings, and director KYC. Two filings are specific to foreign ownership: the FLA return to the RBI by 15 July and the Annual Performance Report by 31 December. Both are commonly missed.
Considering an India entity?
A confidential conversation with a senior chartered accountant. We will review your sector's FDI route, your state's apostille timeline, and the documentation your US parent will need — before you commit to anything.
Request a senior consultation- Companies Act, 2013 — India Code
- Foreign investment reporting — RBI FIRMS portal
- Incorporation and annual filings — Ministry of Corporate Affairs
- FDI policy — DPIIT
Rohit Lohade is a Chartered Accountant and India entry specialist at KRPR & Associates. With 15+ years of experience, he has assisted 250+ international companies — including global brands — incorporate and operate in India. He currently serves as Resident Director for multiple foreign-owned Indian subsidiaries.