ALL ABOUT STARTUP INDIA SCHEME
What is a Startup?
A startup is a young entity founded by one or more entrepreneurs to offer a unique product or service. The entity either develops a new product/service or offers the current product/service in a different manner.
What is Startup India?
Startup India is a flagship initiative of the Government of India, intended to build a strong ecosystem that is conducive for the growth of startup businesses, to drive sustainable economic growth and generate large scale employment opportunities. The Government through this initiative aims to empower startups to grow through innovation and design.
Benefits under Startup India Scheme
The first requirement is to incorporate the business in a legal form which can be a Private Limited Company, a Limited Liability Partnership or a Partnership Firm.
For availing various benefits under the Startup India scheme, an entity would be required to be recognized by the Department for Promotion of Industry and Internal Trade (DPIIT) as a startup by applying at https://www.startupindia.gov.in/content/sih/en/startupgov/startup-recognition-page.html.
The benefits provided to recognize startups under the Startup India initiative are:
1. Self-Certification: Self-certify and comply under 3 Environmental & 6 Labour Laws. In case of labour laws, no inspection will be conducted for a period of 3 years.
a. Labour Laws
b. Environmental Laws
2. Tax Exemption: Income Tax exemption for a period of 3 consecutive years under section 80-IAC and exemption on capital and investments above Fair Market Value under section 56 of the Income-tax Act, 1961.
Eligibility Criteria for applying to Income Tax exemption (80-IAC):
Eligibility Criteria for Tax Exemption under Section 56 of the Income Tax Act:
3. Easy Winding of Company: In 90 days under Insolvency & Bankruptcy Code, 2016.
4. Startup Patent Application & IPR Protection: Fast track patent application with up to 80% rebate in filing patents.
5. Easier Public Procurement Norms: Exemption from requirement of an earnest money deposit, prior turnover and experience requirements in government tenders.
6. Small Industries Development Bank of India (SIDBI) Fund of Funds: Funds for investment into startups through Alternate Investment Funds.
Registering on Startup India website
Registering a profile on the Startup India website is a fairly simple process.
1. Click on ‘Register’ and fill in the details as required in the registration form. An OTP will be sent to your registered email address, post submitting which your profile will get created.
2. You will have an option to select your profile type. For ‘Individuals’, the profile goes live immediately, whereas for ‘Startups’, the profile goes under moderation for 24-48 Hrs, post which you will be able to avail all benefits on www.startupindia.gov.in.
A Startup which has a profile on the Startup India website is considered a registered Startup on the portal. These Startups can apply for various acceleration, incubator/mentorship programs and other challenges on the website along with getting access to resources like the Learning and Development Program, Government Schemes, State Polices for Startups and pro-bono services.
QUALIFICATION AS A STARTUP UNDER STARTUP INDIA SCHEME:
Company Age: Period of existence and operations should not be exceeding to years from the date of Incorporation.
Company Type: Incorporated as a Private Limited Company, a Registered Partnership Firm or a Limited Liability Partnership.
Annual Turnover: Should have an annual turnover not exceeding Rs.100 Crore for any of the financial years since the incorporation.
Original Entity: Entity should not have been formed by splitting up or reconstructing an already existing business.
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