Indian Subsidiary
| Market Price: | |
|---|---|
| Filing CA Price: | ₹20000/- excl. GST |
| ₹23600/- incl. GST | |
| You Save: | ₹20000/- (50%) |
| Complete By: | within 7 days from payment |
The Indian subsidiary Company is the company whose interests are held and controlled or held by another company. The preference share capital and the paid-up equity share capital of the Subsidiary company can be used to determine the holding company, subsidiary company relationship between two companies. It can either be owned or owned in part by another company. It should be noted that the company that owns the subsidiary is known as a parent company or a holding company.
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Features
- No requirement of prior approval for repatriation dividend.
- Debt, Equity, and Internal accruals are the available funding mechanisms.
- Indian Transfer pricing regulation is applicable to the Indian subsidiary Company.
- It is treated as an Indian company for all other applicable laws and the purpose of income tax.
- It is taxed at a lower rate of 30% in comparison to a foreign company whereas a foreign company is taxable at 40%.
- The dividend distribution tax (DDT) is subjected to 16.995%.
Advantages
- Limited Liability:The liability of Directors and members of the private limited company is limited to their shares. This means the company suffers from any loss and faces financial distress because of primary business activity, the personal assets of shareholders/Members/Directors will not be at risk of being seized by banks, creditors, and government.
- Continuity of Existence:Mostly, the life of the business doesn’t affect by the status of shareholders and even after the death of the shareholder the private limited company continues to exist.
- Brand ValueThe brand value of a company will get increased because employees feel secure in joining the private limited company, vendor feels secure in offering credit, investor feels secure in investing, the customer feels trust and confidence in a brand in buying company product or services because of the sound corporate structure. Many startup companies start with zero revenue and rapidly reaches to a multibillion-dollar company in just a few years just because of the high brand value of the company.
Compliances
All Indian Subsidiary companies are needed to comply with Companies Act, the Income Tax Act, FEMA guidelines, transfer pricing guidelines. Time to time, they are liable to file an income tax return with the income tax department, annual return with the registrar of companies and other mandatory filings with the reserve bank of India or securities and exchange board of India etc. However, the requirement is based on the type of industry, turnover, and the number of employees.
