How to Start an IT Consultancy in India: A Simple Guide for Foreign Businesses  

Introduction

India offers vast opportunities for all types of businesses, from trading and food to pharma and IT. With a skilled workforce and pro-business policies, India becomes a renowned destination for both local and international business enthusiasts.

This blog is an easy guide on how you can start an IT Consultancy in India, covering everything from registration to compliance and growth.

Why Foreign IT Companies Are Expanding to India

India has one of the largest tech talent pools in the world, competitive operational costs, and a rapidly growing market for digital transformation. Many US, UK, EU, and UAE-based IT firms are now opening offices, hiring Indian developers, or forming local consulting teams to serve global clients better.

You don’t have to be a large enterprise. Even small or mid-sized foreign companies can set up an IT consulting business in India.

What Are Your Options to Start a Business in India?

If you’re a foreign company or entrepreneur, you have four main ways to set up in India:

Recommendation: Go with a Private Limited Subsidiary. It allows you to hire people, raise invoices in India, sign local contracts, and repatriate profits legally.

Step-by-Step: How to Register a Private Limited Subsidiary in India

Here’s what the registration process looks like for foreign business owners:

• Choose a company name (we help you reserve it)
• Appoint at least one director who lives in India (we can assist)
• Submit your passport, proof of address, and business details
• Apply through India’s online company registration system
• Get a Certificate of Incorporation – this is your official license
• Open a bank account and start operations

You don’t need to visit India physically. Most of this can be done remotely via digital signatures and scanned documents.

What Documents Will You Need?

After Registration: What You Need to Operate Legally in India

Once the company is registered, you’ll need the following:

• Company PAN: For tax identification
• TAN: Required to deduct taxes when paying vendors or employees
• GST Number: If you’re billing Indian clients or crossing ₹20 lakh (~USD 24,000) revenue
• Import Export Code (IEC): If you’re offering cross-border services
• Payroll setup: If you hire employees
• Professional tax and local office registration (varies by city/state)

Ebizfiling helps you stay 100% compliant.

Do I Need to Deposit Capital in India?

Yes, but there is no minimum capital requirement. You can start with a small amount. The important part is to show basic financial intent and open a business bank account in India.

Can I Repatriate Profits to My Home Country?

Yes. Once you pay local taxes, profits can be sent back to your home country using legal banking channels. We also help set this up with documentation for your local and Indian bank.

Using Your Indian Company as a Back Office

Many foreign companies set up their Indian subsidiary to act as a back office or delivery hub for their main operations abroad. This includes:

• Hiring Indian tech talent to serve global clients
• Running software development or testing teams
• Managing customer support, billing, or compliance tasks
• Operating remote infrastructure or cloud deployments

The Indian company can invoice the parent company or be treated as a cost centre. This setup is fully legal and efficient when managed with proper documentation and inter company agreements.
We help structure these setups for tax efficiency, HR compliance, and transparent fund transfers between your foreign and Indian entities.

Why Choose Ebizfiling for Your India Setup?

Starting a business in another country can be complex; but not with the right partner. Ebizfiling has helped 10,000+ businesses (including several global IT and consulting firms) successfully set up and scale in India.

Here’s what sets us apart:

• End-to-end incorporation support (including from abroad)
• Legal drafting for board resolutions, inter company agreements, and POA
• Dedicated Indian resident directors (if needed)
• Fast DSC, DIN, and PAN processing for foreign nationals
• Expert handling of RBI, GST, ROC, and payroll compliance
• International founder-friendly documentation process

We simplify the legal, compliance, and communication complexities — so you can focus on building your tech team and delivering value.

Summary: Your IT Business, Indian Advantage

You don’t need to be a big tech firm to enter India. Whether you’re a solo consultant, a remote-first IT team, or a scaling firm, starting a business in India is a smart way to:

• Save on costs
• Hire excellent tech talent
• Reach global clients efficiently

Ebizfiling makes this easy, fast, and reliable; from company setup to compliance, payroll, and accounting.
Let us handle the paperwork while you focus on coding, scaling, and delivering value.

Frequently Asked Questions (FAQs)

1. Can a US/UK/UAE company start a business in India?
Yes. You can register a new company in India that is 100% owned by a foreign entity or person.

2. Do I need to travel to India to start the business?
No. The process is online. You only need to send notarized documents. We’ll handle the rest from India.

3. Can I hire Indian developers and pay them from this Indian company?
Yes. Once your Indian company is registered and has a PAN, you can hire, pay salaries, and even offer local benefits.

4. Can I invoice Indian clients from my Indian company?
Yes. In fact, invoicing locally helps you avoid double taxation and improves your service delivery speed.

5. Can I own 100% of the Indian company?
Yes. Foreign nationals and companies can fully own an Indian subsidiary. You only need to appoint one Indian resident director, which we can help you with.

6. What kind of IT services can I offer?
You can offer any lawful tech services including software development, UI/UX design, mobile app development, cloud consulting, remote infrastructure management, data analytics, cybersecurity consulting, and more.

7. Can I set up a virtual office instead of renting physical space?
Yes. Many foreign companies start with a virtual address for registration purposes. You can scale into physical space later.

8. Do I need a license to provide IT consulting in India?
Generally no. IT services are not heavily licensed. However, you’ll need GST registration, IEC if you export services, and local compliance depending on your setup.

9. Can I work with government or enterprise clients in India?
Yes, but many will expect your Indian entity to have a GST number, valid address, and tax compliance history. We help you prepare your business for these tender/contract opportunities.

10. Can I use freelancers or contractors instead of hiring employees?
Yes, you can work with Indian freelancers or agencies. However, be mindful of regularity — if someone works full time under your direction, Indian authorities may treat it as employment.

11. How long does the process take?
It usually takes 10–20 business days to incorporate a Private Limited Company in India. Opening the bank account and GST registration may take a few more days