What’s Startup? How Long can any entity be recognised as Startup? How to take benefit of Startup India Plan?
What is a start-up?
Private limited company, One person company, Limited liability partnership or registered partnership, not older than 5 years, having turnover not exceeding 25 crores and working towards innovation, development, deployment or commercialization of new products, processes or services driven by technology or intellectual property has been defined as “Start-up” under Start-up India Scheme Launched by Honourable Prime Minister of India, Shri Narendra Bhai Modi.
Exemption from doing compliance of labour laws and other laws?
Start-up once recognised, would be free from inspection of Labour Laws Compliance for 3 years. And compliance of environmental laws will also be based on post self-certification.
Are there any other financial benefits?
The start-up can claim 80% rebate on patent filing fees. Apart from this, the government will fund the cost involved in defence of patent and will give rebate of 80% in the fees. The government of India will also pay fees of facilitator for helping start-ups in obtaining the patent.
How can anyone apply to get recognition for his or her start-ups?
The Government would launch mobile apps and create website for easy registration of startups. Anyone desiring to register start-up will have to fill application forms on either portal or mobile apps.
What else the government has planned to support Start-Ups?
The Ministry of Human Resource Development (HRD), the Department of Science and Technology have agreed to partner to set up over 75 start-up support hubs in the National Institutes of Technology (NITs), the Indian Institutes of Information Technology (IIITs), the Indian Institutes of Science Education and Research (IISERs) and National Institutes of Pharmaceutical Education and Research (NIPERs). These hubs will educate and facilitate the setting up of new start-ups in India.
What are the benefits given to start-ups in public procurement?
Start-ups engaged in the manufacturing sector are given exemptions from fulfilment of criteria of having ‘experience/ turnover’ without any relaxation in quality standards or technical parameters in public procurement (by government).
How much fund has been kept available for this scheme?
The Government has declared to setup a separate fund with an initial corpus of Rs. 2,500 crores and total corpus of Rs. 10,000 crores over a period of 4 years.
What are benefits given under the provision on Income Tax?
Under the Scheme, Recognised start-ups have been exempted from filing income tax for 3 years from the date of its recognition as start-ups. The start-up will be eligible for tax benefits only after obtaining certificate from the Inter-Ministerial Board, setup for this purpose.
Is any exemption in capital gains tax given to Start-Ups?
Yes. If the investor invests money in fund of funds set up by the government, he would get capital gains tax exemptions. In addition to this, existing capital gain tax exemption for investment in newly formed MSMEs by individuals are also extended to all start-ups.
What is the eligibility for startups?
To become eligible as a startup and get a green signal from the Inter-Ministerial Board, the entity should be the one which aims to develop and commercialise, a new product or service or process or a significantly improved existing product or service or process that will create or add value for customers or workflow. Products, services or process, which do not have potential for commercialisation or is undifferentiated or have no or limited incremental value for customers will not be considered under this Scheme. To be recognised as start-up the entity should file application with a
1. a recommendation (with regard to innovative nature of business), in a format specified by DIPP, from an Incubator established in a post-graduate college in India
2. a recommendation (with regard to innovative nature of business), in a format specified by DIPP, from an Incubator recognized by Government of India or
3. be funded by Government of India or any of state governments as part of any specified scheme to promote innovation or
4. have a patent granted by the Indian Patent and Trademark Office in areas affiliated with the nature of business being promoted
5. be funded by an Incubation Fund/ Angel Fund/ Private Equity Fund/ Accelerator/Angel Network duly registered with SEBI that endorses innovative nature of the business or
6. an incubator, which is funded (in relation to the project) from Government of India as part of any specified scheme to promote innovation
on portal of http://www.startupindia.gov.in or fill application form in mobile apps of Start-up India.
If you want to register you START-Up in India, Call us at +91-8540099000, +91-8540085000. +91-8540078000.
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