Startup India program was launched by GOI to support new businesses by providing tax exemptions and other benefits. This initiative has helped many entrepreneurs start on their entrepreneurial journey. In this blog, we will explain if your business falls in the startup category and if it does, then how to register your company under the start-up category.
Startup- What Exactly is It?
A startup is defined as a newly setup business that is started by a small group of people. It offers an innovative new product or service that is different from the other businesses. It can also include the redesigning of an existing product or a service into a more efficient and better version.
Eligibility Criteria Under Startup India Initiative
Let us look into the eligibility criteria for registering under the Startup India scheme.
- The business should be a private limited company (PLC) or a limited liability partnership (LLP).
- The enterprise can maintain its startup status for 10 years from the registration date. Previously it was for 7 years but has been increased to 10 years now to extend the benefits.
- The firm retains its startup status remains if the annual turnover remains below Rs 100 crore in any of the 10 years. As soon as your company goes over the Rs 100 crore mark, it loses its startup status. The annual turnover limit was Rs 25 crore before but has been raised to Rs 100 crore now.
- The business has been approved by the Department of Industrial Policy and Promotion (DIPP).
- A patron guarantee from the Indian Patent and Trademark office.
How to Register a Company/Startup in India
Given below are the procedures for registering a startup in India.
1. Business Incorporation
The first step is to incorporate your firm as a Private Limited Company (PLC) or a Limited Liability Partnership (LLP) or a Partnership Firm. These include the normal procedures for business registration like getting the Certificate of Incorporation, Partnership registration and other compliances.
2. Register with Startup India
Visit the Startup India website and enter the details of your company in the form provided. You will receive an OTP sent to your email address. Enter the OTP and other details that include the name and stage of startup and type of the user. Your Startup India profile will be created now.
3. DPIIT Recognition
Avail of the Department for Promotion of Industry and Internal Trade (DPIIT) Recognition next. The new users should click on the ‘Get Recognized’ button. Existing users should click on the ‘Dashboard button’ first and then on ‘DPIIT Recognition’.
DPIIT Recognition offers several benefits like relaxation in public procurement forms, easy winding of the company, access to intellectual property services and resources, self-certification under labor and environment laws, tax exemption for a period of 3 consecutive years and tax exemption on investment above fair market value and access to “Fund of Funds”.
4. Recognition Application
The next page that will open is the ‘Recognition Application Detail’ page. Click on ‘View Details’ that is under the Registration Details section. Now you can fill the ‘Startup Recognition Form’ and then submit it.
5. Upload the Documents for Registration
These documents include the following:
- Incorporation/Registration Certificate of the startup
- Details of the Directors of the startup
- Proof of concept. This can include website links, videos, pitch decks, etc.
- You can provide Patent and trademark details, but these are optional now.
- PAN Number
6. Get the Recognition Number
You will get the recognition number immediately after applying. Your documents will be examined, and if all details are correct, then a certificate of recognition will be issued within 2 business days.
A word of caution. Take utmost care and check documents minutely before uploading them. If you failed to submit the required document or submitted the wrong or forged document, then you may be fined either Rs 25,000 or 50% of your paid-up capital.
Benefits of Registration as a Startup in India
How to register a startup company in India and reap benefits? Here are some of the benefits you can avail yourself as a registered startup in India.
Registration of Patents, Trademarks, and Designs
You can approach a list of facilitators if you need a trademark for your business or a patent. You will get a waiver of 80% and pay only the statuary fees. You will need to bear only the statutory fees thus getting an 80% reduction in fees.
Self-Certification Under Employment and Labor Laws
Your registered startup can self-certify under labor and environmental laws. It helps reduce compliance costs. Startups can self-certify their compliances under 6 labor and 3 environment laws. This is valid for a period of 3 to 5 years from the incorporation date of the startup. Do check the list of 36 white category industries on the Central Pollution Control Board website. If your startup comes under these categories, then you do not require clearance under the 3 environment laws for a period of 3 years.
You can also claim tax exemption from income tax for a period of 3 years. To do that, your startup must be certified by the Inter-Ministerial Board (IMB). But only the startups incorporated on or after 1st April 2016 can apply for this exemption.
How to Register a Company/Startup in India– List of Documents no Longer Required
You do not need the below mentioned documents for your startup registration now.
- Letter of Recommendations
- Letter of funding
- Sanction Letters
- MSME Certificate
- Udyog Aadhar
- GST Certificate
How to register a startup company in India? By following the above-mentioned pointers, you can easily register your startup under the Startup India scheme. Along with the above-mentioned benefits, you can also apply for the different incubator, acceleration, and mentorship programs. You can also access different government schemes, learning and development program, and other pro-bono services. So, register today and enjoy the benefits and watch your company grow.
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