The Startup India initiative was launched by the Government of India in 2016 to promote innovation, entrepreneurship and economic growth. Once a company is recognized as a startup under this scheme, it opens up a whole lot of benefits and opportunities for it to grow and scale efficiently. Below are the benefits that startups can apply for after being recognized under the Startup India scheme.
- Tax Benefits and Exemptions :One of the biggest advantage of being recognized under the Startup India scheme is to apply for various tax exemptions. These include:
2. Income Tax Exemption for Three Years: Eligible startups can get 100% tax exemption on profits for any three consecutive years within their first ten years of existence. This means startups can re-invest their profits back into the business without paying income tax.
3. Exemption on Long term Capital Gains: Startups can claim exemption on long term capital gains if they invest their proceeds in certain specified funds or schemes. This means startups can re-invest capital gains back into the business without paying tax on profits.
4. Angel Tax Exemption under Section 56: Recognized startups are exempt from the Angel Tax, a tax on the capital raised through issue of shares at a price higher than the fair market value. This means startups can raise funds without worrying about tax hassles.
5. Faster Patent Registration and Intellectual Property Rights (IPR) Protection Innovation is at the heart of many startups and protecting that innovation is critical. Recognized startups get faster registration of patents, trademarks and designs. Specifically:
6. Seed Funding : Funding is a critical aspect of startup growth, and the Startup India Seed Fund Scheme offers financial assistance to startups at the early stages of development. Recognized startups can apply for seed funding to cover proof of concept, product development, market entry, and commercialization, making it easier for them to scale their innovations.
7. Fast-tracked IPR Processing: Startups get expedited services for IPR applications, reducing the time taken for patent and trademark approvals. Startups can get up to 80% rebate on patent application fees. This reduces the cost of protecting innovations.
8. Easier Public Procurement Process Government contracts are a big source of revenue for many businesses. Recognized startups can participate in tenders with several benefits including:
9. Exemptions from Prior Experience and Turnover Criteria: Startups, being new businesses, can participate in government tenders without meeting the eligibility criteria of prior experience or turnover.
10. Registration on Government e-Marketplace (GeM): Startups can register on GeM platform to sell their products and services directly to government entities and increase their market access.
Summary The benefits of being a recognized startup under Startup India scheme goes beyond just recognition. From tax exemptions to funding support, intellectual property protection and global market access, these benefits helps startups to scale up. With reduced regulatory hassles and more access to resources, recognized startups can grow faster, innovate better and compete globally.
Startup India Scheme not only provide financial support, it also ease a way to attain your next of your startup business. Incorpadvisor we help you in recognition of your innovative ideas or betterment of existing product or service get recognised under startup india registration.
