Is there any such requirement ?
Yes, it is 182 days
One Director ( Any one ) should be a Indian Resident And resident means 182 days
Governing section = sec 149(3) Source: Section 149 subsection 3 of the Companies Act 2013 states as follows :
Is there any Penalty
Company has 4 Directors, all four are from USA. Are all of them required to meet this condition ?
No. Only 1. And Any One of them can and must do this.
What if I dont want to appoint a local unknown as Director. I am afraid of the risks…..
No problems. You have three options.
What about Indian Income Taxes ?
Yes, since that person will be “Indian Resident” due to 182 days presence. He will be taxed in India, on his global income. Except those incomes that are taxed in country of source as per the DTAA . double tax avoidance treaties.
But don’t worry. The tax rates in India are much much lower than in most western countries. Our tax rates are in slabs from 0% to 30%. whereas income tax rates in most Western countries and Australia are upto 40% to 57% peak rates. https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates
And there is no double tax. Once taxed in India, in Individual capacity, that taxed income is tax free when you take it back to any other country.
Any additional Government notification on that ?
Yes, Government has specifically noted that “Companies incorporated after 30.9.2014 need to have the resident director from the date of incorporation itself.”
Regards, from MLG Team,
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