Register a Company in India Now Digitally for Your Import-export Activities
Online shopping is here and not disappearing anytime soon. Thus, online businesses are growing. With an online store, the sky is the limit. More so now you can even register a company digitally from the comfort of the home or office. India is seeing a rise in a multitude of non-native, imported products. Whether from online businesses or physical shops. The Indian market is also laden with locally made products that are ready for export. The import-export trade is a lucrative one. Hence, why not learn how to start a trading company in India for starters.
Register Your Company First
There are no shortcuts to starting a trading company in India. But, the Indian government has made it easier for budding entrepreneurs to register their companies. It all begins with registering the trading company like any other company. You would have to decide on a company name, its availability and the company structure. It could be a sole proprietorship, partnership, private limited company or LLP. Once the application is approved, the registrar of companies (RoC) will assign the company with a Corporate Identity Number (CIN).
Getting to Import-export
When a company is conducting an import or export business, the company must do the following to ensure smooth operations:
- Register with the Director-General of Foreign Trade (DGFT). Once the company completes registration with DGFT, they will receive a unique Import-Export Code (IEC). It is a ten-digit code that Indian Customs will check for every import or export transaction. To apply for this unique code, you have to submit an ANF2A form, two passport size photographs of the applicant, PAN, valid mobile number and email ID, current bank account number and banker’s certificate.
- Apply for an import license. Without it, your goods can be declared unauthorised, confiscated or refused entry to India. The licenses are renewable and valid for approximately two years for capital goods and 18 months for raw materials, components and consumables.
- Register with an Export Promotion Council (EPC) to obtain a Registration Cum Membership Certificate (RCMC). It is mandatory for companies seeking an authorisation to import or export or even reap trade benefits. There are fourteen EPCs in India in various sectors. If you are planning to export, these EPCs will help your exports get the necessary benefits. To apply, the company would need to submit a certified copy of the IEC number and a membership fee accordingly.
- Apply for an export license. If you are already an importer, you can also export. The business can go both ways if you intend so. Provided that the products or services are within the Indian Trading Code based on the Harmonised System of Coding (ITC-HS) classification. The code is an eight-digit alphanumeric code representing a category of goods. Only the DGFT issues this code to the exporter.
Many are concerned about tax when it comes to import-export business. If properly registered, trading companies can enjoy tax exemptions from the integrated goods and services tax (IGST). Other benefits include the regional Goods and Services Tax and the Export-Import Credit Guarantee Corporation. These are generally what you need to know on how to start a trading company in India works. We are here to help if you seem to be stuck at some point of registering your trading company.