The Startup India Scheme is growing in popularity in India. It aids in the development of the Indian economy while also attracting competent entrepreneurs and businesspeople. Under Prime Minister Narendra Modi’s leadership, the Indian government began this Startup India Certificate programme. This Startup India Scheme is really good in terms of fostering entrepreneurship and creating jobs in our country.
The Department of Promotion of Industry and Internal Trade (DPIIT) is one of the government ministries that spearheaded the Startup India initiative, which aims to assist new businesses grow and contribute to the Indian economy.
The Indian government provides DPIIT (Department for Promotion of Industry and Internal Trade) Recognition as one sort of evidence of identification. The Indian government has supplied the DIPP number (Department of Industrial Policy and Promotion). This DIPP number assists businesses in enrolling for the StartUp India initiative, which offers a variety of incentives for their business.
The Government of India launched the StartUp India Certificate of Recognition in 2015 to strengthen the Indian economy while also increasing young confidence in becoming entrepreneurs and encouraging entrepreneurship. The government is taking steps to promote corporate development, which would help the Indian economy grow.
Also read: What is Startup India Scheme?
This Startup India Scheme programme is beneficial to people who have creative ideas but lack the financial means to implement them. This Startup India certificate is beneficial to many entrepreneurs with unique ideas who want to expand their firm.
The Startup India credential is required for anybody starting a business in India. This certification includes intellectual property rights such as trademark registration, patent registration, and copyright registration. It will also include certain perks with that startup India certificate that will be advantageous to your new beginning business.
Table of Contents
Who is not eligible for the Startup India Certificate?
- Sole Proprietorship
- Firm constitute by the notary partnership deed
- Once annual turnover exceeds INR 100 crores
- Company is older than 10 years.
Eligibility criteria for Startup India Certificate:
- This Startup has applied for this recognition certificate; the Startups must have had a prior financial year turnover of less than 100 crores. If a company’s turnover exceeds 100 crores, it is ineligible for an Indian recognition certificate.
- The startup must be registered as a private limited company or a partnership.
- A firm is considered and referred to as a startup during the first ten years after it is registered.
- The startup must have unique ideas and some improvement in any product, service, or process to be eligible for recognition. The venture must also create new employment possibilities and money. This sort of startup is qualified to receive Startup India accreditation.
3 levels of recognition for Startup India certificate:
Issuance of Startup India Certificate
After assessing the unique business process and other qualifying requirements, DPIIT awards a Startup India certificate to the newly established firm upon receipt of an application.
Angel Tax Exemption on Equity Investment
- If a startup is further authorised by the Inter-Ministerial Board, an investment made on the premium by investors is tax deductible u/s 56(2)(viib) of the Income Tax Act.
- This exemption is available till the total paid-up share capital plus share premium for the company does not reach INR 25 crore.
- A startup must make a Form-2 declaration with DIPP to be eligible for the angel tax exemption.
Income Tax Exemption
- Out of a ten-year period, the startup will be eligible for a three-year tax vacation.
- Startup must make a separate application under Form-1 for income tax exemption under Section 80-IAC, and the Income Tax Authority will either grant or deny the application.
- This application can only be submitted when a Startup India Certificate has been issued.
What are the Benefits of Startup India Certificate?
Exemption from taxation under section 80 IAC
You may petition for tax exemption u/s 80 IAC of the Income Tax Act after receiving recognition under the Startup India initiative.
During the first ten years of startup eligibility, a startup can get a tax break for three years in a row.
Criteria for claiming the 80IAC tax break include the following:
- Must be a well-known startup
- Only Limited Liability Partnerships (LLPs) or Private Limited Companies (PLCs) are eligible.
- Must be formed on or after April 1, 2016.
Exemption from taxation for angels under section 56
You can apply for Angel Tax Exemption after registering with Startup India.
Angel Tax Exemption Criteria u/s 56 of the Income Tax Act 1961:
- The firm must be a DPIIT-recognized startup
- with a total paid-up share capital and share premium of not more than INR 25 crore following the planned share offering.
Self-Awareness of Labor Laws
During the first three years, startups can self-assess their compliance with labour laws, and there will be no inspections or actual visits by government officials. Startups can self-certify with the 6 labour regulations listed below using the Startup India platform.
- Laws governing migrant workers from other countries
- Laws on Gratuities and Provident Funds
- Other Construction Workers’ Laws Employees’ State Insurance Laws
- Laws governing contract labour
- Our experts can help you self-certify your compliance with labour rules.
Also read: What is Startup India Seed Fund Scheme?
Exemptions for trademarks, patents, and IPRs
After receiving a startup India certificate, businesses can get help registering for intellectual property rights like as trademark registration, patent registration, and copyright registration.
The following IPR benefits are available to recognised startups:
- Fast-track startup patent applications with a discount of up to 80% on government expenses.
- A group of facilitators will help with IP applications.
- Reimbursement for the filing of a trademark application
6 Steps process of Startup India Registration Certificate in India:
Step 1- Before filing for a Startup India registration, you must first form your business as a Private Limited Company, Limited Liability Company, or Partnership firm, and then follow the standard method for registering your company with Startup India.
If your firm meets all of the eligibility requirements, you must register it with the government’s Startup India Scheme. You must give the necessary business facts and corporate information. You must complete out the registration form found on Startup India’s official website before registering. You must submit all corporate information, as well as supply and upload any relevant documents.
Step 2- After selecting a package from the website, you must pay the online charge. You may pay using any of the payment methods available on the website.
Step 3- After completing all paperwork and submitting your order, your Startup India application will be allocated to one of the Startup India program’s specialists.
Must Read: Why Startup India?
Step 4- After reviewing all of the data and eligibility criteria for the Startup India Registration, the specialists at Startup India file the application for the next phase. During the verification process, the Startup India department double-checked all of the information you gave in the online form.
Step 5- The department of Startup India evaluates the information and transmits it to the department that will give the Startup India certificate, following all of the government of India’s regulations and standards.
Step 6- If you pass the exam, the government will issue you a Startup India Registration certificate once you validate all of the information you supplied. All of these processes must be completed in order to obtain the Startup India certificate.