Prime Minister Mr. Narendar Modi had introduced the ‘Start up India, Stand up India’ initiative on Independence Day. Backing up on his promise, on 16th January 2016, he unveiled a detail action plan for start-up enterprises under this scheme.
Start-up is an entity registered in India. Start-up is the company which is not older than 5 years and its annual turnover should not exceed 25 Crore. It works towards innovation, development, deployment or commercialisation of new products driven by technology or intellectual property. Such an entity is not formed by splitting up, or reconstruction, of a business already in existence.
Start-up’s aim is to develop and commercialise which creates or add value for customers or workflow. Here are some features which have benefited to entrepreneur.
- Single Window Clearance even with the assistance of a portable application
- 10,000 crore reserve of assets
- Changed and all the more benevolent Bankruptcy Code to guarantee 90-day leave window
- Opportunity from perplexing investigations for a long time
- Opportunity from Capital Gain Tax for a long time
- Flexibility from assessment in benefits for a long time
- Dispensing with formality
- 80% diminishment in patent enlistment expense
- Self-accreditation consistence
- Advancement center point under Atal Innovation Mission
- Beginning with 5 lakh schools to target 10 lakh youngsters for development program
- New plans to give IPR assurance to new businesses and new firms
- Stand India over the world as a start-up center point
Benefits – If you are eligible for the scheme Start Up India–
- Tax holiday of first 3 year – No income tax is payable on all the profit earned in first 3 years
- No inspection for first 3 years under labour law – In addition, environment law compliance is required only post-self certification.
- 80 % Rebate in patent fee and fast track examination and processing of application for patent.
- Manufacturing sector startup are exempt from the criteria of prior ‘experience/ turnover’ without any relaxation in quality standards or technical parameters in public procurement (by government).
- Self Certification Compliance – This is a amazing step by the government, but Startups have to follow all the law regarding payment of gratuity, provident fund, contract labor regulations etc. The only difference is that no labour inspector will at your place for for verification but after 3 years you may be penalized if any default is found in compliance of all the matters.
- No Capital gain tax if investor exits form startup and invest the gain in the fund as recognized by govt.
- , equal opportunity in government procurement, a Rs 500-crore credit guarantee scheme and easier exit norms. Japanese Softbank, which had already invested $2 billion in Indian startups, has pledged total investments of $10 billion.
How tax benefits can be availed in Start-ups.-
- Addition in value: Value added in the product and customer.
- Solution to the problem: Start should be available to solve certain problems of the society. Points should be clearly mentioned.
- Working with Business Model: Start-up should be according to the particular business model about Business model otherwise, incubators may be rejected.
- Recommendation letter –This application is needed from certain authorities. Authorities can any incubators established the post-graduate college in India, incubator which is funded from Central or state government.
Step to get Recommendation letter
- Easy task: You can Directly reach out to the incubators via email or phone and to tell case correctly.
- Startup application filling: After you are connected, the incubators will send you the application form which you need to fill out properly along with the necessary documents.
- Visit the incubators: possibility that incubators may call you for the meeting, and you may have to visit it personally.
- Business should be working: Business model is, it should be working model. Proposed business will not be considered by incubators.
- Fees: The incubators may charge you Rs.5000. If your application has been taken up by an expert panel, then the cost will further increase by Rs.5,000/-. This will not be more than Rs.10,000/- in any case.
Start-up is the fast-growing business that aims to meet a marketplace need by developing an innovative product or service. Start-up India has given an opportunity to many young youths to bring their business idea into the application. This scheme is a success and has given many benefits to entrepreneur and other people.