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FOREIGN NATIONALS  |  LIAISON OFFICE  |  BRANCH OFFICE  |  PROJECT OFFICE   |  JOINT VENTURE

  
BRANCH OFFICE
  
A branch would mean an establishment carrying on substantially the same activity as its Head Office. Foreign companies intending to open a Branch Office in India need to obtain prior permission of RBI which would encompass even approval to the scope of activities that are intended to be carried out in India. As per the guidelines laid down by the RBI, 

The Branch Office in India is allowed to carry on only the following activities:
 
Export / Import of goods
Rendering professional or consultancy services
Carrying out research work, in which the parent company is engaged
Promoting technical or financial collaboration between Indian companies and parent or overseas group companies
Representing the parent company in India and acting as buying / selling agent in India
Rendering services in Information Technology and development of software in India
Rendering technical support to the products supplied by parent / group companies
Foreign airlines and shipping companies are also permitted to open branch offices in India.

This is considered a part of the foreign company and is not treated as a separate legal entity. The office can undertake trading activities, but not manufacturing. It is subject to taxation in India on income accrued in India. If there is a double taxation agreement with the country in which the foreign company is incorporated, the tax paid in India can be set off against the total tax payable by the parent company abroad.

A Branch Office can remit the profits (net of any withholding tax) generated out of its operations in India on production of the prescribed documents, and on establishing that it has earned a net profit by undertaking the permitted activities. The Branch Office need not retain any profits as reserves in India
 

   

 

   

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