Monday, November 21, 2011

Starting a business in India

Starting a business in India is overwhelming but simple. The steps involved are cumbersome, but with around $2000 or Rs 100,000 you can hire an attorney or a CA who can complete all the formalities for you. I think there are hundreds of blogs and pages which get into the details of this. Here's an example. However contrary to a lot of myths out there - you don't have to stand in long lines for hours,  paying bribes to a dozen folks and wait for months to get started. With the right professional help you can get this done in a couple of weeks.

However some tips and some basic rules worth mentioning on running a company in India:

1. There is a strong DIY tendency in the US --- resist the urge. Especially with paperwork and dealing with authorities. Get a good lawyer/CA, etc to take care of this for you. Also if you can manage it - find a good admin right away. Paperwork and procedures are overwhelming you want this delegated to the right person at the soonest.

2. File returns and taxes on time!! Government authorities don't bother you if you have everything in order and filed on time. This includes income tax (to be paid in installments, VAT returns, excise returns, final balance sheet and income tax returns). Do it on time and you are golden.
3. Document everything! you make a Rs 1000 payment to your plumber - get a cash paid receipt for this. You need a document for every little thing in this country. This just leaves it open for authorities to hassle you later. Maintain a system that preserves all your documents for 10 years!

I'll be posting a few other tips about this topic, so stay tuned.

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