Startup India Registration

Startups are booming in India. The government is also supporting young entrepreneurs to establish startups. Startups help to boost the country's economy. A startup is a business that offers innovative products or services that provide solutions to a problem existing in society. A startup may also redevelop a current product or service into something better. The Government of India, under the leadership of PM Narendra Modi, has started and promoted the Startup India initiative to develop the Indian economy, recognise and promote startups and attract talented entrepreneurs.

Startup India is an Indian Government initiative that is intended to build a strong eco-system for nurturing innovation and startups in the country to drive sustainable economic growth and generate large scale employment opportunities. Through this initiative, the government aims to empower Startups to grow through innovation and design.

Objective of Startup India Registration

The objectives of the Startup India Movement are outlined below. The action plan envisages supporting the startups and more:

  • Enhanced infrastructure, including incubation centres IPR facilitation, including easier patent filing
  • The better regulatory environment, including the tax benefits, easier compliance, improved setting up of a company, fastest mechanism and more.
  • A goal to increase the funding opportunities
  • Provide a vast networking database for the entrepreneurs and other stakeholders in the startup ecosystem.

Eligibility Criteria for Startup India Registration

To be eligible for Registration with Startup India, an entity must meet specific criteria. Here is a detailed breakdown of the eligibility requirements for the Startup India Scheme:

Age of the Applicant: Any Indian citizen aged 18 or above can apply for the scheme.

Age of the Firm: The Company’s Incorporation date should be at most ten years.

Type of Company: The Company should have been incorporated as a Partnership Firm, Private Limited Company, or a Limited Liability Partnership (LLP).

Annual Turnover: The Company’s turnover should be at most Rs.100 crore in any financial year since Incorporation.

Original Entity: The entity should have been formed initially by the promoters and not by splitting up or reconstructing an existing business.

Innovative & Scalable: The Startup should have a plan for developing or improving a product, process, or service and have a scalable business model with a high potential for creating wealth & employment.

Companies working towards developing a new product or service can avail of benefits under the Startup India policy if they fulfill the following conditions:

    1. Concerned startups must work to develop, deploy, or commercialize any product or service that is driven by the latest technology or intellectual property.

    2. Startups must aim to improve an existing product or create a new one to enhance customer value or workflow.

    3. Startups must involve solely in developing and commercializing a unique product to enrich customer value or increase workflow.

For Registration and approvals, Startups are required to obtain approval from the Department for Promotion of Industry and Internal Trade (DPIIT) based on the following criteria:

  • Recommendation of an incubator from any post-graduation college.
  • Recommendation from an incubator recognized by the Central Government.
  • A patent filed and published in the Journals of the Indian Patent Office in the specific area of the product or service.
  • Registration with SEBI for startups providing funding and equity services.
  • Funding letter from the state or central Government of any scheme to promote innovation.

Regarding partnership startups, 51% of the shares should be owned by women or individuals in the Scheduled Caste and Scheduled Tribe categories. Additionally, they should not have defaulted on any credit payments.

Benefits of Startup India Registration

The Startup India scheme offers several critical benefits to registered startups, including:

Self-Certification: Startups can easily self-certify compliance for 6 Labour and 3 Environmental Laws through a simple online procedure.

Tax Exemption: Recognized startups enjoy income tax exemption for three consecutive financial years out of their first ten years since Incorporation. They can also apply for exemption from angel tax under Section 56 of the Income Tax Act.

Easy winding up of Company: Startups can shut down their business within 90 days from the date of application.

Patent Application and IPR Services: DPIIT-recognized startups receive significant benefits while processing patents and other intellectual property rights services at a considerably lower fee. Startup India provides an 80% rebate for filing patents and a 50% rebate for filing trademarks.

Access to Funding: Startup India offers two funds to support registered startups: a. Fund of Fund for Startups (FFS) b. Startup India Seed Fund Scheme (SISFS)

Easier Public Procurement Norms: Government ministries, departments, and public sector undertakings have been authorized to relax norms in all public procurements for startups recognized by DPIIT.

Who can apply for Startup India Scheme?

1. Private Limited Company

2. Limited Liability Partnership

3. Partnership Firm

4. One Person Company (OPC)

Documents Required Startup India Registration

Certificate of Incorporation / Registration

PAN card of the Company/LLP/Firm

Memorandum of Association (MOA) and Articles of Association (AOA) of Company

LLP agreement or Partnership deed (For Firm and LLP)

Link of website, Mobile Application, Videos, Pitch deck, YouTube Channel, Trademark and Patent details, etc.

Annual Accounts of the Startup along with Income tax returns certified by CA (optional)

Startup India Registration Process

The Startup Registration Process involves the following steps:

Step 1: Incorporate your business entity- The first step of the DPIIT registration process is to incorporate a business that’s also a legal entity. Only a registered partnership firm, LLP or PLC can apply for DPIIT recognition. There are other requirements for registration as a startup, do check if your business is eligible to register as a startup.

Step 2: Create an Account on Startup India Portal - Once your company is formed, you can create your Startup India Login. This is the first step in getting a Startup India Certificate. You can visit the Startup Portal and register your company there. Thereafter, you will be able to apply for the DPIIT recognition.

Step 3: Fill out the form- As soon as you log in to the portal, you will see an option to apply for the recognition certificate. As you can see, you just need to select the relevant business entity, and then fill out the form with your company details.

Step 4: Self Certify to certain conditions- While you are applying for the registration as a startup, you need to self certify to certain conditions, such as:

  • That your business is not a result of any split or reconstruction of an existing entity;
  • Whether the entity is bootstrapped or funded;
  • Majority of shareholding is held by Indian promoters;
  • The the entity is not a joint venture; and
  • Lastly, that it is an original entity.
  • Apart from this self – certification, Startup India registration process also involves submission of certain necessary documents to support your application.

Step 5: Upload all the Documents- While filing the form, you also need to submit certain mandatory documents, which are as follows;

  • Certificate of Incorporation
  • Letter of Authorisation
  • Aadhar Card of the authorised person;
  • Copy of PAN of the entity;
  • Pitch Deck;
  • IP registration certificate, if any;
  • Website of the Company; and
  • Any recommendations from prior investors (if applicable).
  • All documents required for the startup India registration process are supposed to be filed in a PDF format.

Step 6: Get Startup India Certificate - Once you submit the form with all the relevant documents, the process of registration is completed. However, the DPIIT will go through the form and scrutinise your application. In case they find any discrepancies, they might even issue an objection to your startup registration. In case of discrepancies in startup India process, you can connect with experts at The Startup Trends.

If the department finds the application to be free of any discrepancies, they will issue the Recognition number through the DPIIT registration certificate. The DPIIT issues this certificate in 4 to 5 working days. The department then sends the startup India recognition certificate directly to the email ID of authorised person from the entity. Once you get the DPIIT certificate, you can easily start claiming for the ancillary benefits such as angel tax exemption and section 80 IAC tax exemption, available under the Startup India scheme.
 
     
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