Everything You Should know about Startup Services in India
Written by gkkedia Dt. February 3rd, 2022
The phrase “startup” refers to a company in its early stages of operation. Startups are setup by one or more entrepreneurs who desire to market a product or service for which they think there is demand. In the initial phase of business the startup company faces lots of issue i.e capital funding, poor planning and leadership. To help these startups the Indian government has launched “Startup India” to encourage entrepreneurs and guide them to create businesses.
The Startup India initiative aims to develop employment by way of incentives, funding, and an easy process for registration tax benefits, and government schemes that will support the startup in conducting the business properly, and the enhanced possibilities will securely assist entrepreneurs in making successful businesses with great ease.
Startup India is a flagship initiative of the government of India. The operation was initially declared by the Indian Prime Minister, Narendra Modi, throughout his speech on January 15, 2015. The action plan of startup creative was set off to create a powerful eco-system for developing and revolutionising startups in the country that will bring sustainable economic growth and produce large-scale employment benefits. Such a startup managed by the competence team should be reported to the Department for Promotion of Industry and Internal Trade (DPIIT).
“Startup India” is eligible for benefits and schemes when it is covered under “Eligible Startup”. Let’s first understand “eligible startups.”
“Eligible startup” Means
- Annual turnover does not exceed Rs.100 crore for any financial year from the date of formation (“eligible startup”).
- Such startups should not be reconstructed or split, whose existence was inferred earlier.
- This type of startup should be a private limited company or a limited liability partnership, and it should be used for service product and process invention, development, and improvement.
- It had been in business for less than ten years.
The occasion was initiated on January 16, 2016 by the former Finance Minister of India, Arun Jaitely. The action plan for this creative focuses on three operations, such as
- Simplification and handholding
- Funding Support and Incentives
- Industry-Academia Partnership and Incubation.
The following are the benefits available for startups:
- The firm was created between April 1, 2016 and March 31, 2022, which qualifies for a tax deduction. Budget 2022, on the other hand, has extended such statistics until March 31, 2023. However, in any given financial year, the turnover of such a company does not reach Rs. 25 crore. Profits are taxed at zero percent for four years in a row, for a total of ten years. It must be certified by the Inter-Ministerial Board (IMB).
- Under the new Section 54EE of the Income Tax Act, an eligible startup invests long-term capital gain or a portion of it in a fund that the central government notifies within six months of the date of capital asset transfer. However, a higher amount can be invested, up to Rs. 50 lakh. If such an invested amount is withdrawn within 3 years from such a specified fund, in this case, the exemption will be revoked in the year in which the amounts are withdrawn.
- Self-certification Certificate: Only nine labour and environmental law require self-certification certificates, and there will be no inspections for three years unless there is a major complaint
- Patent Registration Fee Rebate: If a startup wants to patent for innovation, it can simply contact the government’s list of facilitators.The startup will receive an 80% rebate on patent registration fees.
- Trade-mark Rebate: If a startup wants to register a trademark for commercial purposes, it can simply contact the government’s list of facilitators.The startup will receive a 50% rebate on trade-mark filing fees.
- Simple wind-up: Under the Insolvency and Bankruptcy Code, start-ups must be able to wind up their businesses within 90 days of filing for wind-up.
- Fund: The government provides a venture capital fund worth Rs. 10,000 crore.
- Submit a Tender: Startups are eligible to submit a tender. It is exempt from
- Experience required: Whenever an organization applies for a tender, a minimum of experience is required. Whereas in the case of startups in India, no minimum experience is required.
- Turnover limit: There will be no requirement for a minimum turnover limit.
The procedures for registration are as follows
The government of India has launched a mobile app and a website for easy procedures registration for startups.
- First incorporate your business as a Private Limited Company or a Partnership firm or a Limited Liability Partnership.
- After incorporation, the business must be registered as a startup, and fill out the necessary information.
- Obtain recognition from the Department of Promotion of Industry and Internal and Trade (DPIIT).
- Following are the documents that are required to be filed for registration, i.e. details of directors, patent and trade-mark details, PAN number, company details, and certificate of incorporation or certification of registration.
- After verifying all the submitted documents within 2 days, the certificate of recognition will be issued. In such a case, however, you will face a fine of 50% of the paid-up capital, with a minimum fine of Rs. 25,000. If The document was not uploaded, Incorrect or Falsified document
The government offers startup India programmes to aid in the smooth operation of businesses. Some schemes are being discussed, including as
- Venture Capital Scheme: This scheme provides assistance in the form of an interest–free loan issued by a small farmer agribusiness consortium (SFAC) to a qualifying project to cover a deficiency in the capital required to complete the project.
- Extra Mural Research Funding: The Extramural Research (EMR) funding scheme of the Science and Engineering Research Board (SERB) to academic institutions, research laboratories and other research and development organisations to carry out basic research in all border areas of science and engineering is in the public interest.