GST registration for a foreign-owned Indian company

Does a foreign-owned Indian company need GST registration?

Sometimes at once, sometimes later, and sometimes not at all in the early months. As a general rule, registration is triggered once aggregate turnover crosses ₹20 lakh for services or ₹40 lakh for goods (trading). These are general limits, not a rule for every business: some categories, such as those making inter-state supplies, must register regardless of turnover and need to register sooner.

Thresholds are revised from time to time, so confirm the current figure and how it applies to your case with your adviser before you decide.

Who must register whatever the turnover?

Under the current rules, as we understand them, certain persons must register regardless of turnover. The categories that most often matter for a foreign-owned company are:

• Businesses making inter-state supplies of goods.
• E-commerce operators and suppliers through e-commerce platforms.
• Casual taxable persons and non-resident taxable persons.
• Persons liable to pay tax under reverse charge.
• Persons who must deduct or collect tax at source.
• Input service distributors.
• Persons supplying online services from outside India.

Service providers making inter-state supplies of services below the applicable turnover threshold are exempted from registration under Notification 10/2017-Integrated Tax. This exemption is for services only; as the list above shows, inter-state supplies of goods still require registration regardless of turnover.

What is different for a subsidiary that serves its parent?

Many subsidiaries, including most captive centres, invoice the foreign parent for services. That raises two questions that we would settle before you fix a registration date:

1. Export of services. The general turnover threshold does not give a real exemption here. Every export has to go either through the LUT route, which is zero-rated, or by paying IGST and claiming it back as a refund, and both routes need a GST registration. So an entity making export supplies needs to be registered before it makes the export supply, or before it receives a supply it wants to claim credit on.
2. Reverse charge on imported services. A subsidiary that receives services from its parent, such as management, technology or support, may face a reverse-charge liability. Because this liability can itself trigger registration, check it before assuming you can stay unregistered.

If your subsidiary is a GCC or a captive centre, our page on captive versus build-operate-transfer models explains how revenue is usually structured, which drives these answers.

Can you register during incorporation?

Yes. The combined incorporation form (AGILE-PRO-S, Form INC-35) links several registrations to the incorporation filing, including EPFO, ESIC and bank account opening, and it includes GSTIN as an optional item. In practice, it usually makes more sense to apply for GST separately, once incorporation is complete and you have clarity on your registration timing.

Since 1 November 2025, Rules 14A and 9A provide a simplified registration path for low-risk applicants. Whether your subsidiary qualifies depends on its profile, so ask your adviser rather than assuming.

Our incorporation and registrations service handles the GST application alongside the incorporation filing where a client wants it.

How does GST affect your pricing and cash flow?

Once registered, the company charges GST on taxable supplies, claims credit for GST paid on eligible purchases and files periodic returns, monthly or quarterly depending on turnover and other factors.

Three practical effects follow:

• Invoices. Invoices to the parent and to any Indian customer need the right place-of-supply and tax treatment.
• Working capital. Input credit on purchases such as rent and professional fees can sit unused for a time when output is nil or exempt, so model this in your budget.
• Books. The books must reconcile to the returns each period. A bookkeeping process that ties GST to the ledger saves cost at audit. See accounting, tax and compliance for how ProLead supports this.

How to decide, step by step

1. List every stream of income, who pays, and from which country.
2. List the main purchases, especially imported services from the parent.
3. Check expected turnover against the threshold for your state and supply type.
4. Ask your adviser the export and reverse-charge questions above.
5. Decide whether to request a GSTIN at incorporation or later.
6. Add the return dates to your compliance calendar.

If your office state is not yet chosen, read our guide to registered office requirements, because the state fixes the threshold that applies.

What mistakes should you avoid?

• Registering in the wrong state. The registration follows the place of business, so settle the registered office first.
• Assuming no registration means no GST exposure. A reverse-charge liability on services from the parent can arise even when you make no taxable supplies of your own.
• Invoicing before you are registered. If a registration is required, plan its timing before the first invoice, since invoices issued too early or too late can create correction work.
• Leaving GST out of the budget. Input credit and cash flow need modelling before the first month of operations, not after the first return.

Note: Rules and forms change often. This page is general information, not legal or tax advice. Check the current position with a practising Chartered Accountant or Company Secretary before you act.

General information only, not legal or tax advice. Rules and forms change, so confirm the current position with a practising Chartered Accountant or Company Secretary before you act. See our disclaimer.