Register a Company in India from Canada

Author: Manu Rao | Updated: March 2026

At a Glance

Why Canadians Are Setting Up Companies in India Right Now

Canada and India have entered a new chapter. After a two-year diplomatic freeze triggered by the Nijjar crisis in 2023, Prime Minister Mark Carney visited New Delhi in March 2026 and formally launched CEPA (Comprehensive Economic Partnership Agreement) negotiations. The target: $50 to $70 billion in bilateral trade by 2030, up from $8.66 billion in goods during FY 2024-25.

That is not just political talk. The numbers back it up.

Bilateral merchandise trade grew 10% in calendar year 2024, reaching approximately USD 23 billion. India exported $4.22 billion to Canada in FY 2024-25 while importing $4.44 billion. Trade is roughly balanced, unlike many of India's other bilateral relationships.

And institutional money is already here. CPP Investments, managing the Canada Pension Plan, holds a $21.6 billion portfolio across Indian infrastructure, real estate, logistics, and highways. Their positions include National Highways Infra Trust, Delhivery, Flipkart, and Kotak Mahindra Bank. CDPQ (Quebec's pension fund), Brookfield Asset Management, and Fairfax Financial Holdings round out the major Canadian institutional investors.

Between April 2000 and March 2024, cumulative Canadian FDI into India reached $3.9 billion according to DPIIT. That figure doubled from $1.8 billion in just five years, lifting Canada from 27th to 17th largest source of FDI for India.

The Diaspora Factor

Roughly 2 million people of Indian origin live in Canada, making up 5.1% of the total Canadian population per the 2021 Census. About 850,000 hold Indian passports as NRIs, and another 1.15 million are Canadian citizens of Indian descent (PIOs). Forty percent reside in the Greater Toronto Area, with significant populations in Ontario, British Columbia, Alberta, and Quebec.

India is now Canada's top source country for immigration. This growing community drives trade, remittances, and cross-border business formation.

Choose Your Entity Type

Four entity structures are available to Canadian investors setting up in India. Each has different rules around FDI routing, compliance requirements, and liability.

Most Canadian investors choose the Private Limited Company. It offers the cleanest automatic-route FDI path, limited liability, and maximum operational flexibility. An LLP works for professional services and consulting but has sector restrictions under FDI rules.

One detail competitors often get wrong: the resident requirement for an LLP designated partner is 120 days of stay in India during the preceding financial year, not 182 days.

FDI Route and Sector Rules for Canadian Investors

Canada does not share a land border with India. Press Note 3 restrictions (which require government approval for investments from China, Pakistan, Bangladesh, Nepal, Bhutan, Myanmar, and Afghanistan) do not apply to Canadian investors.

Under the automatic route, Canadian investors can hold 100% ownership in most sectors without prior government approval. These include:

• Information technology and software services
• Manufacturing
• Infrastructure and construction (under conditions)
• Pharmaceuticals (greenfield)
• E-commerce (marketplace model)
• Financial services (insurance up to 74%, banking subject to RBI norms)

Government approval is needed for:

• Defence production beyond 74%
• Print media beyond 26%
• Multi-brand retail (51% cap, state government consent required)
• Broadcasting (49-100% depending on segment)

Prohibited sectors where no foreign investment is allowed: atomic energy, lottery and gambling, chit funds, Nidhi companies, tobacco manufacturing, and real estate business (excluding townships and construction-development).

Canadian FDI into India tends to cluster in infrastructure (highways, toll roads), financial services (pension fund allocations), IT, clean energy, and natural resources. LNG cooperation is growing as India's natural gas demand is projected to reach 110 to 120 BCM by the early 2030s, and Canada's LNG export infrastructure is well positioned to serve that need.

Step-by-Step Registration Process

Here is the actual process a Canadian resident or NRI follows to register a company in India.

Document Checklist and Authentication

Here is what you need from the Canadian side:

• Valid Canadian passport (or Indian passport for NRIs) -- notarized copy
• Proof of address in Canada (utility bill, bank statement, or government-issued document dated within 2 months)
• Passport-size photographs
• Bank statement showing the address (for each director/subscriber)
• Board resolution or authorization letter from the Canadian parent company (if applicable)
• MOA and AOA -- executed and notarized
• Declaration by first directors (Form INC-9)

All documents must be apostilled through Global Affairs Canada or the relevant provincial authority. Budget 2 to 3 weeks for document preparation and apostille processing. This is the step where most timelines get blown, and most competitor websites do not mention it at all.

DTAA Tax Table: Canada-India

The India-Canada Double Taxation Avoidance Agreement was signed in 1996 and entered into force on May 6, 1997. It determines how income is taxed when flowing between the two countries.

Key points for Canadian investors:

• The Canada treaty uses a broader definition of Fees for Technical Services than some other treaties (like the US). There is no "make available" clause, meaning a wider range of services can be taxed at 15%.
• Dividend withholding for minority shareholders is 25% under the treaty, which is actually higher than the Indian domestic rate of 20%. In that case, you would use the domestic rate.
• Government-to-government interest payments are exempt.
• Surcharge and health and education cess are not levied on top of treaty rates.
• The treaty does not include a Limitation of Benefits (LOB) clause.
• Capital gains on shares deriving more than 50% of their value from immovable property in India remain taxable in India.

To claim treaty benefits, you need a Tax Residency Certificate (TRC) issued by the Canada Revenue Agency (CRA). File Form NR301 with the CRA for this purpose.

TFSA and RRSP Considerations

If you hold Indian investments through a TFSA (Tax-Free Savings Account), note that India does not recognize the TFSA's tax-exempt status. Income from Indian sources may still be taxable in India. NRIs returning to India who still hold a TFSA face potential Indian tax on those gains.

RRSP (Registered Retirement Savings Plan) withdrawals have cross-border implications depending on your residency status. The DTAA provides some relief, but the mechanics are not straightforward. Get proper tax advice before structuring cross-border retirement income.

Form T1135 (Foreign Income Verification Statement) is mandatory for Canadian tax residents holding foreign property costing more than CAD $100,000. Penalties run up to $2,500 per year for non-filing. Your Indian company shares will almost certainly trigger this reporting requirement.

Realistic Timeline

Here is what actually happens, not what brochure websites promise.

Total: 6 to 10 weeks from start to operational.

You may have read "7 to 15 days" on other websites. That timeline leaves out document authentication and bank account setup -- the two longest steps in the process. The 10.5 to 13.5 hour time zone difference between Canada and India also slows coordination. Every question-and-response cycle can cost a full business day.

Post-Registration Compliance Calendar

Once your company is incorporated, here is what the law requires on an ongoing basis:

• FC-GPR filing with RBI: Within 30 days of share allotment to foreign investors. This reports the foreign investment to the Reserve Bank of India.
• Board meetings: 4 per year for Private Limited Companies. First meeting within 30 days of incorporation.
• Annual General Meeting (AGM): By September 30 each year.
• AOC-4 (financial statements): Filed with MCA within 30 days of AGM.
• MGT-7 (annual return): Filed with MCA within 60 days of AGM.
• Statutory audit: Mandatory every year, regardless of turnover.
• Income tax return: Due by October 31 for companies requiring audit.
• GST returns: Monthly or quarterly if registered under GST.
• Transfer pricing documentation: Required if you have related-party transactions between your Canadian parent and Indian subsidiary. Indian tax authorities apply active scrutiny to Canada-India transfer pricing arrangements.

Bank Account Opening

Opening a bank account for a foreign-owned Indian company takes 2 to 4 weeks. Not a few days.

Why? Enhanced KYC requirements for companies with foreign directors. The bank must verify identities through an Authorized Dealer (AD) bank, process FATCA and CRS declarations, and complete internal compliance checks.

You will need your Certificate of Incorporation, PAN card, board resolution authorizing the account, KYC documents for all directors, and proof of registered office.

Banks that are generally more experienced with foreign-owned companies include HDFC Bank, ICICI Bank, Kotak Mahindra Bank, and State Bank of India. Smaller banks may struggle with the compliance requirements or take longer.

Profit Repatriation

Getting money out of India and back to Canada follows a defined process under FEMA (Foreign Exchange Management Act) regulations.

Methods include dividends, royalties, management fees, and share buyback. Dividend Distribution Tax was abolished in 2020 -- shareholders now pay tax directly at the rates listed in the DTAA table above.

The repatriation process:

1. Company deducts TDS (Tax Deducted at Source) at the applicable DTAA rate
2. Company issues Form 16A to the recipient
3. A Chartered Accountant issues a certificate in Form 15CB confirming the payment and applicable tax rate
4. The company files Form 15CA (online declaration) with the Income Tax Department
5. The Authorized Dealer bank processes the outward remittance

This process typically takes 1 to 2 weeks once all documents are in order.

Exit Strategy

Nobody tells you this upfront, but you should know your way out before you go in.

Two options exist if things do not work out:

Strike-off under Section 248 of the Companies Act: Suitable for dormant companies that have not operated for two or more years. The Registrar of Companies can remove the name from the register. Faster and cheaper.

Voluntary liquidation under the Insolvency and Bankruptcy Code: For active companies with assets and liabilities to settle. Requires a special resolution by shareholders, appointment of a liquidator, and clearance from the NCLT (National Company Law Tribunal). Timeline: 6 to 12 months.

Both routes require clearing all tax liabilities and regulatory dues first.

How Beacon Filing Helps

We handle the complete India entry process for investors based in Canada. From initial structuring through post-incorporation compliance, here is what we cover:

• Foreign Direct Investment advisory — route selection, sector analysis, RBI compliance, and FC-GPR filing
• Resident Director services — appointment of a qualified Indian resident director who meets the 120-day requirement
• Company setup and incorporation — SPICe+ filing, DSC, DIN, name reservation, and Certificate of Incorporation
• Tax and DTAA advisory — treaty benefit structuring, transfer pricing documentation, and annual compliance
• Accounting and statutory audit — bookkeeping, financial statements, ROC filings, and GST returns

For a detailed walkthrough, see our case study: Canadian NRI Starting a Consulting Firm in India.

Related Country Guides

Setting up from a different country? These guides cover similar territory:

• Register a Company in India from United States of America
• Register a Company in India from United Kingdom
• Register a Company in India from Australia

Get in Touch

Setting up an Indian company from Canada? Talk to us. No commitment, no generic sales pitch. We will walk you through the structure, timeline, and costs specific to your situation.

WhatsApp: +91 874 501 3644 | Email: hello@beaconfiling.com