Educational Institution Setup in India
India has one of the largest education systems in the world, with over 1.5 million schools, 40,000+ colleges, and 1,000+ universities. The education sector is witnessing rapid transformation through digitalization, skill development initiatives, and policy reforms like NEP 2020.
This comprehensive guide covers the registration process for schools, colleges, coaching centers, and EdTech companies in India, including board affiliations, approvals, and regulatory requirements.
Industry Overview and Opportunities
Market Statistics
- • Education market: $225 billion by 2025
- • EdTech market: $10 billion by 2025
- • K-12 enrollment: 250+ million students
- • Higher education: 40+ million students
- • Online education users: 100+ million
Growth Drivers
- • NEP 2020 implementation
- • Digital learning adoption
- • Skill development focus
- • Rising disposable income
- • 100% FDI in education
Entity Types for Education Business
Schools (K-12)
Must be established as non-profit entities (Trust/Society/Section 8 Company).
- • Trust/Society registration
- • Section 8 Company (optional)
- • Not-for-profit operations
- • 12A and 80G tax benefits
Higher Education & EdTech
Can be established as for-profit entities.
- • Private Limited Company
- • Limited Liability Partnership
- • For-profit operations allowed
- • External funding possible
Step-by-Step Setup Process for Schools
Trust/Society Formation
Register a Trust under Indian Trusts Act or Society under Societies Registration Act. Minimum 3 members required. Draft Trust Deed/Memorandum of Association with clear educational objectives.
Land Acquisition
Acquire land meeting minimum requirements (typically 2000+ sqm for CBSE affiliation). Land can be owned or leased (minimum 30 years lease required). Obtain land use conversion if needed.
State Education Department Registration
Apply for recognition from the State Education Department. Required before board affiliation. Submit building plans, staff details, and infrastructure compliance report.
Board Affiliation
Apply for affiliation to CBSE, ICSE, or State Board. Process takes 6-12 months. Requirements include infrastructure, qualified teachers, library, labs, and play area as per board norms.
GST Registration
Education services by schools are GST exempt. However, registration may be required for ancillary services like transportation, cafeteria, and uniforms. Coaching centers attract 18% GST.
CBSE Affiliation Requirements
CBSE (Central Board of Secondary Education) is the most popular school board in India with over 24,000 affiliated schools. Affiliation requires meeting strict infrastructure and academic standards.
Infrastructure Requirements
- • Minimum 2000 sqm land area
- • Classrooms (min 8m x 6m)
- • Science labs for secondary
- • Library with 1500+ books
- • Playground and sports facilities
Academic Requirements
- • Qualified teachers (B.Ed required)
- • Principal with 5+ years experience
- • Teacher-student ratio 1:30
- • NOC from state education department
- • Financial viability proof
EdTech Company Registration
Company Structure
EdTech companies can be registered as Private Limited Companies with for-profit motive. This allows raising venture capital, ESOPs for employees, and exit opportunities.
Regulatory Compliance
- • Company registration (Pvt Ltd)
- • GST registration (18% on EdTech services)
- • Data protection compliance
- • Content copyright registration
- • POSH compliance (if 10+ employees)
Taxation for Educational Institutions
GST Exemptions
- • Education services by schools up to higher secondary are exempt
- • Services by educational institutions exempt
- • Transportation of students exempt
- • Mid-day meal services exempt
GST Applicable (18%)
- • Coaching centers and training institutes
- • EdTech platforms and online courses
- • Higher education services (private)
- • Sale of uniforms, books, stationery
Income Tax Benefits
- • Section 12A: Exemption for charitable trusts
- • Section 80G: Donations to educational trusts eligible for deduction
- • Schools must apply for 12A registration
Government Schemes for Education
PM SHRI Schools
PM Schools for Rising India - scheme to upgrade 14,500+ schools to benchmark standards. Existing schools can apply for upgradation.
Start-up India
EdTech startups can avail tax benefits, funding support, and simplified compliance under Start-up India initiative.
Digital India
Various programs to promote digital learning infrastructure in schools and colleges.
Key Takeaways
For Schools
- ✓ Trust/Society registration (non-profit)
- ✓ State Education Department recognition
- ✓ Board affiliation (CBSE/ICSE/State)
- ✓ Apply for 12A and 80G tax benefits
For EdTech
- ✓ Private Limited Company
- ✓ GST registration (18% on services)
- ✓ Start-up India registration
- ✓ Data protection compliance