DEFINITION OF START-UP:
An entity shall be considered as a Start-up:
- If it is incorporated as a private limited company (as defined in the Companies Act, 2013) or registered as a partnership firm (registered under section 59 of the Partnership Act, 1932) or a limited liability partnership (under the Limited Liability Partnership Act, 2008) in India; and
- Upto seven years from the date of its incorporation/ registration; however, in the case of Start-ups in the biotechnology sector, the period shall be up to ten years from the date of its incorporation/ registration; and
- If its turnover for any of the financial years since incorporation/ registration has not exceeded Rupees 25 crores; and
- If it is working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation.
Provided that any such entity formed by splitting up or reconstruction of a business already in existence shall not be considered a 'Start-up'.
1. An entity shall cease to be a Start-up on completion of seven years from the date of its incorporation/ registration or if its turnover for any previous year exceeds Rupees 25 crores. However, in respect of Start-ups in the biotechnology sector, an entity shall cease to be a Start-up on completion of ten years from the date of its incorporation/ registration or if its turnover for any previous year exceeds Rupees 25 crores.
2. Turnover is as defined under the Companies Act, 2013.
PROCESS OF RECOGNITION
The process of recognition as a 'Start-up' shall be through an online application made over the mobile app/ portal set up by the Department of Industrial Policy and Promotion. Entities will be required to submit the online application along with the Certificate of Incorporation/ Registration and other relevant details as may be sought. Start-ups also have to submit a write-up about the nature of business highlighting how is it working towards innovation, development or improvement of products or processes or services, or its scalability in terms of employment generation or wealth creation.
BENEFIT OF REGISTRATION:
- SELF CERTIFICATION and compliance under 9 environmental & labour laws.
- INR 10,000 CRORE FUND of funds for investment into Start-ups through Alternate Investment Funds.
- START-UP PATENT APPLICATION fast track & up to 80% rebate in filling patents.
- INR 2,000 CRORE CREDIT guarantee fund for Start-ups through National Credit Guarantee Trust Company / SIDBI over 4 years.
- PUBLIC PROCUREMENT-fast track under the criteria of 'prior experience/turnover' for Start-ups in all Central Government ministries/departments.
- WINDING UP COMPANY in 90 days under insolvency & Bankruptcy code 2016.
- TAX EXEMPTIONS on capital gains & on Investments above Fair Market Value.
- TAX EXEMPTIONS on Income tax for 3 years (Start-ups are exempted from income tax for 3 years. But to avail these benefits, they must be certified by the Inter-Ministerial Board (IMB). Start-ups recognized by DIPP, Govt. of India can now directly avail IPR related benefits without requiring any additional certification from IMB.)
INFORMATION AND DOCUMENTS REQUIRED FOR THE APPLICATION / RECOGNITION
1. Entity Details
2. Full Address (Office)
3. Authorized Representative Details
4. Director(s) / Partner(s) Details
5. Information Required
- Current number of employees (including founders)
- What is the current stage of development of your product / service?
- Has your start-up applied for any IPR (Intellectual Property Right) ?
- Is the start-up creating an innovative product / service / process or improving an existing product / service / process*
- Is the start-up creating a scalable business model with high potential of employment generation or wealth creation?
SIMPLE STEPS TO RECOGNITION / REGISTER YOUR START-UP IN START-UP INDIA PORTAL
- You must first incorporate your business as a Private Limited Company or a Partnership firm or a Limited Liability Partnership.
- Visit Start-up India Recognition portal for Register with Start-up India.
- Provide the information Like Organization details, full address of the registered office and List of Directors/ Partners etc.
- Upload PDF documents.
- Answer whether you would like to avail tax benefits or not
- Accept the Terms & Conditions and Submit.
- Start-up India Team send Certificate after verification of information and documents.
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Tags :Corporate Law