Start-up India scheme is a program encouraged by the government and authorized by the Department for Industrial Policy and Promotion (DPIIT) with a motive for reshaping and enhancing growth for Young entrepreneurs. An innovative approach towards gaining employment generation, Finance Management, and corporate infrastructure to transform the system. It encourages manufacturing, trade, and services to go vocal for locals in implementing Make in India.

Eligibility:

-The company should be incorporated as Private Limited or Limited Liability (LLP) or Registered Partnership Firm

-A company must be 10 years old only.

-Turnover of the company should be below 100 crores

-Entity should not have been formed by splitting up or reconstructing existing business.

– The start-up should be working on innovative products or services

Benefits:

1. Corporate Tax Exemption – Start-ups registered under this scheme can avail of tax exemption for 3 consecutive years before completing 10 years from their incorporation date. Only Private Limited Companies or Limited Partnership and incorporated after 1st April 2016 can avail of this benefit.

2. Tax exemption on funding – A Recognition managed by the industrial policy department and promotion can receive tax exemption on investments/Funds not exceeding 25 crores but with certain conditions on asset investment.

3. Rebate in Trademark and patent fees – Start-ups under this scheme will receive priority in patent application and bearing of facilitation cost by Government with 80% rebate in filing of patents. Start-ups will have to bear only statutory fees.

4. Self-Certification – On complying with some of the labour laws and environmental laws, start-ups would self-certify their working procedures and regulations through simple online procedures. It will require no additional inspection and procedures for 5 years but, only start-ups within 5 years of their incorporation can avail of this benefit.

5. Priority in Government tender and procurement scheme – Start-up owners can apply for government tenders without any experience or turnover that is a minimum requirement for companies and also exempted from submitting Earnest Money Deposit or Bid security. Start-ups can easily wind up their operations and FastTrack their insolvency proceedings if they have a simple debt structure that will allow entrepreneurs to experiment with new ideas.

6. Networking – Start-ups registered under this scheme will be allowed to meet multiple investors, speakers, etc on national level government-organised fests and summits. Also, start-ups recognized under this scheme would sell directly to government companies on their e-marketplaces.

Documents required:

– Certification of Incorporation
– Pan Card of company
– List of Directors, partners, and members with Contact details
– MOA and AOA for a company Partnership deed in case of LLP

FAQs

What are the fees for applying under Start-up India Scheme?

Registration under this scheme is completely free from any charges, an applicant needs to be aware of the proceedings and related documentation.

What kind of business structure should I choose for my startup?

The most preferred business structures for a startup are Private Limited companies and LLPs. A Private Limited company is legally recognized and generally favoured by investors. However, it has stricter compliance and may have a higher cost of incorporation. Whereas incorporation cost is lower for LLPs and they tend to have relaxed compliance in comparison to the Private Limited Companies. In addition to that, LLPs have limited liabilities and are equally recognised by investors and all over the world.

How long does it take to get registered under this scheme?

There is no specific time, Officials will check an application thoroughly, and only if it achieves all the respective criteria, an applicant will receive a certificate of recognition. Generally it took 10-15 business days.

How long do we need to wait before applying under this scheme?

New start-ups can immediately apply under this scheme once they have the required documents. Only start-ups registered for more than 10 years cannot apply.

For how long would recognition as a “Startup” be valid?

An entity shall cease to be a Startup on completion of ten years from the date of its incorporation/ registration or if its turnover for any previous year exceeds one hundred crore rupees.