Startup India Certification

What is the Startup India Initiative?

Startup India is a flagship initiative of the Government of India, intended to catalyse startup culture and build a strong and inclusive ecosystem for innovation and entrepreneurship in India. Launched on 16th January 2016, the Startup India Initiative has rolled out several programs with the objective of supporting entrepreneurs, building a robust startup ecosystem and transforming India into a country of job creators instead of job seekers. These programs are managed by a dedicated Startup India Team, which reports to the Department for Industrial Policy and Promotion (DPIIT).

ELIGIBILITY CRITERIA FOR STARTUP INDIA CERTIFICATE

To be eligible under this scheme, a start-up must be incorporated as a Private Limited Company under Indian Companies Act, 2013, a Limited Liability Partnership (LLP) under Indian Limited Liability Partnership Act, 2008 or a partnership firm under the Indian Partnership Act, 1932.

WHO IS NOT ELIGIBLE FOR STARTUP INDIA RECOGNITION?

Sole Proprietorship
Firm constitute by the notary partnership deed
Once annual turnover exceeds INR 100 crores
The company is older than 10 years.

STARTUP INDIA CERTIFICATE BENEFITS

Startup India Seed Fund Scheme

Seed fund is An Initiative from central government to Spur Entrepreneurship Across India.

The Need for Startup India Seed Fund Scheme

Easy availability of capital is essential for entrepreneurs at the early stages of growth of an enterprise.
Funding from angel investors and venture capital firms becomes available to startups only after the proof of concept has been provided. Similarly, banks provide loans only to asset-backed applicants.
It is essential to provide seed funding to startups with an innovative idea to conduct proof of concept trials.

Objective Of The Scheme

Startup India Seed Fund Scheme (SISFS) aims to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry and commercialization.
This would enable these startups to graduate to a level where they will be able to raise investments from angel investors or venture capitalists or seek loans from commercial banks or financial institutions.

Eligibility Criteria

A startup, recognized by DPIIT, incorporated not more than 2 years ago at the time of application.
The startup must have a business idea to develop a product or a service with a market fit, viable commercialization, and scope of scaling.
The startup should be using technology in its core product or service, or business model, or distribution model, or methodology to solve the problem being targeted.
Preference would be given to startups creating innovative solutions in sectors such as social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defense, space, railways, oil and gas, textiles, etc.
Startup should not have received more than Rs 10 lakh of monetarysupport under any other Central or State Government scheme. This does not include prize money from competitions and grand challenges, subsidized working space, founder monthly allowance, access to labs, or access to prototyping facility.
Shareholding by Indian promoters in the startup should be at least 51% at the time of application to the incubator for the scheme, as per Companies Act, 2013 and SEBI (ICDR) Regulations, 2018.
A startup applicant can avail seedsupport in the form of grant and debt/convertible debentures each once as per the guidelines of the scheme.

Easier Norms on GeM Portal

Government e-Marketplace [GeM] is an e-commerce portal for public procurement where private sellers including startups can sell products and services to government buyers and participate in government e-tenders.

Get registered as a seller on government e-Marketplace aka GeM portal.

A registered startup can enjoy privileges over others, private sellers. The separate scheme launched for a startup is named GeM Startup Runway Scheme.

On Gem Startup Runway scheme, Startups are entitled to avail exemption on:

Prior Turnover
Prior Experience
Earnest Money Deposit
Minimum criteria for govt. tender

Tax exemption u/s 80 IAC

Post getting recognition under the startup India scheme, you may apply for Tax exemption u/s 80 IAC of the Income Tax Act.

A Startup can avail of a tax holiday for 3 successive financial years during its first 10 years of startup eligibility.

Criteria for applying to 80IAC Tax exemption:

Must be a recognized Startup
Only Private limited or LLP is eligible
Must be incorporated on or after 1st April 2016

Angel Tax Exemption u/s 56

After startup India registration, you may apply for Angel Tax Exemption.

Criteria for Angel Tax Exemption u/s 56 of the Income Tax Act 1961:

The entity must be a DPIIT recognized Startup
The aggregate amount of paid-up share capital & share premium after the proposed issue of shares, must not exceed INR 25 Crore.

Self-Compliance for Labour Laws

Startups can do self-assessment for labour law compliances and there will be no inspection or physical visit by public officers during the first 3 years. Startups can self-certify through the startup India portal with the given below 6 labour laws.

Inter-State Migrant Workmen laws
Gratuity Laws
Provident Fund Laws
Employees’ State Insurance laws
Other Constructions Workers’ laws
Contract Labour laws

Our professionals can assist In order to self-certify labour laws compliances.

Trademark, Patent, IPR related exemption

On obtaining a startup India certificate, the startups can avail various assistance in applying for intellectual property rights e.g. Trademark registration, patent and copyright registration.

Recognised startups can avail following reliefs in IPR:

Fast-track startup patent applications with an 80% government fees rebate.
A panel of facilitators to assist in IP applications
Rebate on the filing of Trademark application

Easy Winding Up of Company

Startups registered under the startup India scheme can avail easy exit route for winding up the company within 90 days under Insolvency & Bankruptcy Code, 2016, in case the startup business model failed.

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Startup India Certification