Startup India Registration

Intellectual Property Rights (IPR) Benefits

Startup India program promises to provide high-quality Intellectual Property resources and facilities. The government offers 80% rebate on government fees on filing a patent application and a 50% rebate on applying for a Trademark. Also, the patent application of startups is fast tracked for examination and disposal. It also encourage the Startups to avail the benefits of IPR and commercialize the same.

Relaxation in Public Procurement

All the establishments under the Government of India, the Ministries, Public Departments, and Public Sector Undertakings (PSU) have been asked to relax the norms on the procurement process for Startups. The registered Startups can get exemption on:-

• prior experience
• prior turnover
• earnest money deposit

Recognised startups can get listed on Government e-marketplace (Gem portal) and CPPP portals and  shall get relevant updates and information regarding the government tenders.

Self-certification under Labour and Environment laws

The government has given an option to the Startups to self-certify their compliance under 6 Labour Laws and 3 environment laws for a period of 3 to 5 years. The Startups which fall under ‘white category’ of Central Pollution Control Board (CPCB) will be able to self-certify compliance with respect to three Environment Laws for a period of three years.

Tax Exemption

• The profits and gains derived by an eligible startup from the eligible business may get a 100% exemption for 3 consecutive assessment years out of 10 years from the year of its incorporation. These benefits are provided in order to ensure the growth and development of the Startups.
• To avail these benefits, a Startup must get a Certificate of Eligibility from the Inter-Ministerial Board (IMB).
• Recognized Startups are also exempt from tax under Section 56(2)(viib) of the Income Tax Act when such a Startup receives any consideration for the issue of shares that exceeds the Fair Market Value of such shares. The Startup has to file a duly signed declaration in Form 2 to DPIIT.
• Startups are exempted from tax on the long-term capital gain if such long-term capital gain is invested in a fund notified by Central Government. The maximum amount that can be invested in Rs. 50 Lakh.
• Startups are exempted from tax on capital gains arising out of the sale of a residential house or a residential plot of land if the amount of net consideration is invested in prescribed stake of equity shares of eligible Startup for utilizing the same for purchase of a specified asset.

Faster Exits

The government of India has provided the provision of winding up of the business of startups within a period of 90 days while it is 180 days for other companies under the Insolvency and Bankruptcy Code 2016 (IBC 2016).

Fund of Funds

The most tricky part of running or starting a Startup is to search and collect funding. Every other company requires money to make money from. To provide equity funding support for the development and growth of innovation-driven enterprises, the Government has set aside a corpus fund of INR 10,000 crores managed by SIDBI. The fund is in the nature of Fund of Funds, which means that the government participates in the capital of SEBI registered Venture Funds, who invest twice the amount in startups.