Yes, sometimes you should. If you are planning a large team in India for the long term, and you have, or will hire, the people to run an Indian company, your own entity gives you full control. For most startups and scale-ups adding their first few people, it is a lot of company to build for a small team, and it takes 12 to 18 months to get there.
Here is what the path involves, so you can decide with the whole picture.
What opening your own entity actually involves
Before anyone starts
- Choosing a structure, usually a private limited company, a branch or a liaison office, with legal and tax advice on which one fits
- Incorporation, registered office, directors, bank account, tax registrations
- Registrations as an employer: provident fund, state insurance, professional tax and the state’s shops and establishments rules, which differ from state to state
- Employment contracts that comply with the labour codes in force since November 2025, plus NDAs and IP assignment
- An office: a lease or a co-working membership, internet, power backup, furniture, security
Every month
- Payroll, with tax deducted at source and statutory contributions paid on time
- Statutory filings and returns
- Leave and attendance records, and holiday calendars that vary by state
- Accounting, audit preparation and corporate compliance for the entity itself
Every year, and at every exit
- Salary reviews and benchmarking
- Gratuity provisions
- Annual corporate filings
- Final settlement within the legal timelines whenever someone leaves
None of this is unusual, and plenty of companies do it well. The point is that it is a second operation, running alongside the one you are actually building.
When your own entity makes sense
- You are planning a large team and the fixed cost of running a company is spread across many people.
- You want direct control of employment terms, policies and culture, and you have someone senior to own it.
- You already have HR and finance capacity that can extend to India, or you are ready to hire it there.
- The commitment is long term. An entity is hard to unwind, so it suits a decision you are sure of.
If all four are true, open the entity. It is the right tool.
When it does not, yet
If you need your first one to five people this year, you are not sure yet how big the India team will become, and nobody on your side wants to run an Indian company, then an entity solves a problem you do not have yet. It also delays the problem you do have, which is getting the work done.
What to do while you decide
You do not have to make the entity decision first. A satellite office lets you start with the team while the bigger question stays open.
- You choose the people from a shortlist and manage their work.
- We are the legal employer, and we run the office, payroll, compliance and HR around them. That is 42 touchpoints across 5 phases, on one invoice.
- Setup takes about 3 weeks from a signed engagement.
- There is no lock-in and 30 days notice to scale down.
If, a year from now, an entity makes sense for you, you will be making that decision with real experience of working with a team in India. Whatever you decide then, it will be a better decision than one made from a spreadsheet today.
Read how the five ways to hire in India compare in five ways to hire in India, see the office on /satellite-office, or talk to us.
Sources
- Labour codes in force from 21 November 2025: Khaitan & Co via Mondaq