You've decided to switch. The EOR has done its job — you're now at the scale where running through your own subsidiary saves money, simplifies your cap table, and unlocks operational features (banking, leases, GST credits, R&D tax incentives) that an EOR cannot provide. The migration takes 60 working days end to end, sequenced so your engineers see no gap in pay or benefits.
Weeks 1-2: Incorporate the entity
- Day 1: Engagement signed with your setup partner (FastLegal or similar). KYC documents for both directors collected.
- Day 2-3: Apply for company name reservation via RUN (Reserve Unique Name) on the MCA portal. Approved usually within 2 working days.
- Day 4-8: File SPICe+ (incorporation form) with MOA, AOA, declarations, and director consents. The form auto-applies for PAN and TAN.
- Day 8-12: Certificate of Incorporation issued by MCA. PAN and TAN allotted automatically.
- Day 12-14: Director Identification Numbers (DINs) confirmed. Company is legally formed.
Weeks 3-4: Statutory registrations in parallel
Once the entity exists, file every registration in parallel. They land at different speeds.
- GSTIN — apply on GST portal. Issued in 5-10 working days.
- Shops & Establishments Act — apply on the relevant state's labour department portal. 5-15 working days.
- Professional Tax (Employer) enrolment — same state portal. Same week.
- PF establishment code — apply on EPFO Unified portal. 7-15 working days.
- ESI code — apply on ESIC portal. 7-15 working days.
- STPI / SEZ registration (if claiming export benefits) — 2-4 weeks.
Single point of contact through the migration
FastLegal's dedicated consultant runs the full migration — incorporation, every registration, FEMA filings, banking introductions, employee migration ECRs, payroll cutover. One person owns the calendar end to end. You sign documents; we file everything.
Weeks 5-6: Banking and capitalisation
- Open the operating bank account with an authorised dealer bank (ICICI, HDFC, Axis, Kotak, Citi, etc.).
- Foreign parent remits the share subscription money to the bank account. Must be in convertible foreign currency.
- Allot shares to the parent within 60 days of receipt. Board resolution + share certificates issued.
- File Form FC-GPR via the AD bank within 30 days of allotment. RBI acknowledges within 1-2 weeks.
- Open the payroll-only sub-account or a separate salary account for monthly disbursements.
Weeks 7-8: Employee migration
This is the operationally sensitive part. The goal: every employee feels nothing on the day of migration. Same gross pay, same net pay, same PF UAN, same insurance, same email — only the offer letter and Form 16 issuer changes.
- Communicate the migration to employees 3 weeks ahead with a clear FAQ. Confirm no change in CTC, designation, reporting, leave balance, ESOPs.
- Calendar the migration date to the 1st of a calendar month. EOR runs final payroll for the prior month; new entity starts on day 1 of new month.
- Reissue offer letters under the new entity. Same effective date as the original EOR offer letter so seniority and gratuity tenure carry over.
- File the joining ECR on EPFO portal for every employee with their existing UAN. PF balance auto-transfers in the next cycle.
- Notify ESIC (if applicable) of the change of employer for ceiling-eligible employees.
- Notify the group health insurance provider — typically a no-touch change since the policy is now in the new entity's name.
- EOR issues final settlement (no notice cost) on the migration date.
Weeks 8-9: First payroll under the new entity
- Run first payroll on the 1st-5th of the month under the new entity.
- Deposit TDS on or before the 7th. Use the new TAN.
- Upload PF ECR by the 15th. Use the new PF code.
- Pay ESI by the 21st (if applicable). Use the new ESI code.
- Pay PT by the relevant state's due date (typically 20th).
Post-migration tidy-up
- Collect EOR's full record handover: payroll history, statutory filings, Form 16s from prior years (if any), UAN history.
- Quarterly TDS return (24Q) — first one under the new TAN at the next quarter end.
- Annual statutory audit setup — appoint a statutory auditor, register the appointment with MCA.
- Update vendor records, supplier agreements, customer-facing materials to reflect the new entity.
- Update the foreign parent's intercompany agreements (MSA, royalty, services) to be between parent and new subsidiary, not parent and EOR conduit.
Frequently asked questions
Will employees lose tenure / gratuity?+
Not if you migrate on the 1st of a month and reissue offer letters with the original EOR joining date. Seniority and gratuity tenure carry across as continuous service. Document this in the migration offer letter.
What about pending leave balances?+
Encash and carry over. Some EORs encash all leave at exit; others transfer balances to the new employer. Negotiate this upfront — most EORs will transfer with no objection.
Can we run on EOR and own entity in parallel?+
Yes — common during the transition month. Some employees migrate; others stay on EOR. As long as no employee is on both at the same time, no double PF or compliance issue arises.
What if our EOR has a long notice clause?+
Most EORs run on month-to-month or 30-day termination terms. Read the contract. If it's 60-90 days, plan the migration to align — your first month on own entity can be back-to-back with the EOR's last notice month.
Stop reading circulars. Start running clean payroll.
Every FastLegal plan ships with a dedicated payroll consultant — a real human who runs your PF, ESI, PT, TDS and Form 16 issuance, configured to your salary structure, your state, and your hiring plan. You sign off. We do the rest.