The object of policy framework is to focus on the three grounds

a) Simplification and Handholding,

b) Funding Support and Incentives,

c) Industry-Academia Partnership and Incubation.

With the help of this plan, eligible start-ups in India can avail various regulatory and tax benefits, and have access to various funding options if they fulfil certain criteria. The Indian government has been evolving the definition of an “Eligible Start-up, i.e., a Start-up that is eligible to claim regulatory and tax incentives.

In order to create a “Start-up” it is mandatory that the entity must be

a) a Private Limited company (under the Companies Act, 2013), or

b) registered as a Partnership Firm (under the Partnership Act) or

c) a Limited Liability partnership (under the Limited Liability Partnership Act) in India.

Along with the above start-up must fulfils the following conditions:

• Not more than seven years have elapsed from its incorporation/ registration (for an entity in the biotechnology sector, this period is 10 years).

• The turnover of the entity in any financial year since incorporation/ registration has not exceeded INR 250 million.

• The entity is working towards innovation, development or improvement of products or processes or services, or is a scalable business model with a high potential of employment generation or wealth creation.

• Exemption is only available to Start-ups that are private companies or LLP formed on or after 01 April, 2016;

• Plant and machinery used in the business should be new and have never been used in India before;

Any entity formed by splitting up or reconstruction of an existing business is not considered a “Start-up.” Thus, we need to ensure that an entity qualifies as a “Start-up” in the first place to avail the various tax and regulatory benefits.

Documents Required

a copy of certificate or Incorporation.

a write up about the nature of business highlighting how it is working towards

innovation, development or improvement of products or processes or services, or its scalability in terms of employment generation or wealth creation.

Various Benefits to Start-ups

A. For eligible Start-ups formed on or after 01 April, 2016, 100% deduction of profit is available. Further, eligible Start-ups are free to choose any three years out of a period of first ten years from their incorporation, in which they can avail the tax exemption.

B. Plant and Machinery used in the start up shall be new (Max. 20% of Value of Plant and Machinery can be old). However if the Plant and Machinery was used outside India by any person other than assessee and following conditions are fulfilled than it would be treated as New Machinery:

Easy Entry & Exit

One can easily get into the corporate World by forming a Private Company, simply by submitting necessary form with the Ministry of Corporate Affairs and obtain the Certificate of Incorporation. As regard to the exit, one can easily shut down the Business just by informing the Ministry of Corporate Affairs through a form and you can get the legal exit after settling all the liabilities.

Description

Taxindiafiling is here to help you to register your Private Limited Company and to support you throughout your business journey. We will take care of all the registration and filing procedure and our special appointed business expert will provide all the information related with the Company registration to you at every step.

Get a one time free consultation for your business after getting your private limited company registration through Taxindiafiling by scheduling an appointment with our Business Expert.