Briefly explain the concept of Start-Up India Scheme?
Start-up India Scheme is an initiative by the government for the generation of employment & wealth creation to build a strong eco-system for nurturing innovation & Start-ups in the country. The main objective of Start-up Scheme is the development & innovation of products & services & to increase the employment rate in India. The Government of India launched the Scheme in August 2015.
The Scheme has initiated various programs to build Start-up ecosystem & transform India into a country with job creators instead of job seekers. All such programs are managed by Department for Promotion of Industry & Internal Trade (DPIIT). To meet the objectives, Government has announced the Start-up India Action Plan that addresses all aspects of the Startup ecosystem.
- Simplification of Work
- Funding & Incentives
Who is eligible for Registration under the Scheme?
As per the Start-up India Action Plan, following conditions shall be fulfilled in order to be eligible as Start-up-
The start-up should be incorporated as a Private Limited Company or as a Partnership firm or a Limited Liability Partnership (LLP).
An entity should be considered as a start-up up to 7 years and for biotechnology Start-ups up to 10 years from the date of incorporation.
Turnover should not be more than Rs 25 Crore in any of the previous financial years, since Incorporation.
The Startup should be working towards innovation or improvement of existing products, services and processes and should have the potential to generate employment or create wealth.
An entity formed by splitting up or reconstruction of an existing business shall not be considered as a part of “Startup”
Start-up shall obtain certification from the Inter-Ministerial Board setup for such purpose
How to register a Start-up under Start-up India Scheme?
The step by step Registration Process under Start-up India Scheme is as follows-
Step 1- Incorporate the business
Step 2- Register with Start-up India
Register under the Start-up India as a Start-up business by logging into a simple online procedure through the website
Step 3- Upload the documents
A list of documents needs to be uploaded during the registration procedure:-
- Letter of recommendation by a government recognized incubator along with the registration form.
- Certificate of incorporation of the company or LLP and Registration Certificate in case of partnership.
- Brief about the nature of the product or service offered.
Step 4- Get the recognition Number
A recognition number is issued after the completion of the registration process and verification of the documents submitted. A penalty up to 50% of your paid-up capital or Rs 25,000 at the very least would be charged on submitting any wrong or missed document.
What documents are required for registration under the Scheme?
Following documents are required for registering under startup India-
- Copy Of PAN Card of the applicant.
- Certificate of Incorporation or Registration.
- Mobile Number & Email I’d of the applicant.
- Proof of concept or idea like pitch deck or website link or corporate video (in case of a validation or early traction or scaling stage startups) respectively.
- Brief about the product or services of the company
- Patent and trademark details (Optional)
What are the benefits of Start-up India Scheme?
Following are the benefits of the Scheme-
- Tax Exemptions- Income tax exemption on profits for initial 3 years in a block of 7 years also rebates provided on long term Capital Gain and other investments as per prescribed norms.
- Compliance Relief- In order to keep compliance cost low and to reduce regulatory burden, start-ups shall be allowed to self-certify compliances for 6 Labor Laws and 3 Environmental Laws through a simple online procedure.
- IPR Protection– Facilitating IPR protection at lower rates to the start-ups, 80% rebate at the time of patent filing and 50% rebate at the time of Trademark filling provided to the emerging start-ups.
- Networking Opportunities– Opportunities are created by organizing various events for the shareholders of all Start-ups which enable them to meet right people and also attracts investments for their business.
- Government Tenders– Start-ups are exempted from paying the bid amount; Earnest Money Deposit (EMD) at the time of filing for government tenders, thus enables an easy participation in filing tenders.
- Easy Exit- Failed Start-ups can close down their business easily within 90 days from the date of the application of winding up by appointing a professional by liquidating the assets and clearing all the credits.