The topic Founding a company in India After 15 years of the “India boom”, it has already become a kind of commodity service – a “mass product”. Hundreds of tax consultants and lawyers from India and of course from Germany offer this Formation of a Private Limited (Pvt Ltd: the “Indian GmbH”) for market entry as well as a handful of German management consultancies. Depending on which type of contact you prefer, you can choose from a whole range of service providers, all of which are (supposedly) the same Registration work offer and want to relieve the company of administrative procedures - for example:
- Registration of directors: DIN & DSC
- Registration of the company name and entry of the company in the commercial register
- Preparation of statutes and articles of incorporation
- Opening the company bank account
- Various tax registrations: PAN, TAN, VAT, CST etc.
The offers seem comparable and average between 6.000 and 12.000 euros for standard projects. Complexity and costs are manageable. So why shouldn't you go for the cheapest or second-cheapest offer...?
What lawyers and tax advisors cannot (or cannot) do…
While the “typical” support for company start-ups usually only involves the registration work mentioned above, we assume that Dr. Wamser + Batra expressly goes further and offers a service with significantly more depth.
Founding a company in India
We see ourselves as holistic service provider for company formation in India. This means that we do not just limit ourselves to reliably “processing” the formal requirements of founding a business, but we also proactively take into account all (!) corporate and tax law aspects that will determine the cost efficiency of the company in the years following its founding.
We see again and again that when setting up a company, lawyers and tax advisors concentrate on the purely formal requirements without taking into account the numerous entrepreneurial and strategic considerations that come first to the actual foundation come into play.
Successful company formation in India
However, from an entrepreneur's perspective, we know that the lasting quality of a company's foundation is not determined by whether it was formally achieved a week earlier or later. The most important thing is that when a particular legal form is founded, all relevant aspects of the first few years have already been taken into account and incorporated into the relevant documents.
If, for example, the articles of association have to be subsequently changed, capital increased or the transfer pricing model changed, this can result in very high costs or fees that could easily have been avoided. These extra costs are a nice income for consultants and authorities, but in any case an unnecessary annoyance for the customer.
Therefore, as part of our company formation support (or support), we also offer you reliable and practice-oriented advice in Europe itself. We not only employ auditors and lawyers in India, but also German experts who have already worked as CFOs or administrative managers in India. Based on their own many years of experience, they can tell you what to expect, when and how.
Founding a company in India from the perspective of a German entrepreneur
Based on the business models in question, we work with our customers to develop the ideal entrepreneurial “setup” in India. So: What do I need to take into account today to be prepared for the future?
This results in statutes that are individually tailored to the company. We do not offer “off-the-shelf” documents, as they are often offered in India. Together we evaluate the design options available for contracts and documents in each individual case.
We provide our customers with comprehensive information about all corporate and tax law requirements in India and explain the practical differences between Indian and German corporate law. Unfortunately, all of this is not always common practice.
In addition, the project coordination is carried out in German by German experts.
The time and financial effort required to devote to these medium and long-term issues when setting up a business is usually paid off within a few months.
Bad surprises: hidden costs and cross-subsidies
Unfortunately, there are also consulting offers on the market that are missing essential components. But companies will definitely need these in the first 24 months. Later on, these are then sold at a correspondingly higher price as an additional service.
Another and equally common variant: the founding is offered at a particularly low price, which is later “compensated” with significantly inflated fees for administrative support.
Be sure to compare the total costs for the first 24 (!) months – this is the only way you can come to a realistic assessment of the actual price-performance ratio. Therefore, our advice is: get several offers and compare them carefully!
We would be happy to advise you on setting up your company in India: WB finance & compliance® – establish your presence in India properly
