The Government of India started a new initiative of Startup Scheme in 2016. Its primary objective is to promote the growth of the start-ups in India. Under this scheme, the government's main motive is to robust the start-ups in India as they want to create jobs for others instead of job seekers. It is under the control of the Department for Industrial Policy and Promotion (DPIIT). India is experiencing a significant rise in the number of Startups, with the government actively encouraging and assisting young entrepreneurs in establishing their ventures. These Startups play a crucial role in stimulating the country’s economy.
What is a Startup in India?
A startup is a new initiative to start a business in which you can start a small business with a single or group of people in India. In this, you can start a business of another item, product, or service that is unique from others and it allows creating something new and innovative for their startup business. Startup-India is a good initiative to develop the Indian economy.?
The following features fall under the Startup-India:?
- Company Age: The company’s incorporation does not exceed 10 years.
- Type of Company: If you want to enjoy the start-up scheme benefits then your company must be a Private Limited Company under the Company Act 2013 or a Limited Liability company registered under the Act 2008 or registered under the Indian Partnership Act, 1932 as a Partnership Firm.
- Turnover capital : The company's yearly turnover shall not exceed Rs.100 crore.
- A new business company: In this startup scheme, the company needed to be new and didn't restructure any existing entity to avail of the DPIIT Certificate of Recognition.
- Unique and creative innovation: The startup should have unique and creative ideas from other companies. The business should generate revenue and employ the people.?
- Benefits of Startup India Registration: Startups that have required the DPIIT Certificate of Recognition can enjoy various benefits, which are as follows:
- Self-Certification: Once you get the DPIIT Certificate of Recognition, Startups can self-certify their compliance with Three Environmental Laws and Nine Labour Laws.
- Start-Up Patent Application: Recognized Startups are entitled to pay only 80% of the fees for patents, trademarks, copyrights, and designs. Additionally, they can avail of fast-track processing for their patent applications.
- Simplified Regulations for Government Purchasing: Startups managed by the DPIIT can showcase their products on the government e-marketplace.?
- Easy winding up of Company: As per the Insolvency and Bankruptcy Code, 2016, Startups can complete the process of winding up their company within 90 days from the date of applying for insolvency.
- Funds: Startups are eligible for Rs. 10,000 crore funds from Alternative Investment Funds.
- Rs. 2,000 crore of Credit Guarantee Fund: Over four years, Startups have the opportunity to access a credit guarantee fund provided by the National Credit Guarantee Trust Company or SIDBI.
- Tax Exemptions: Upon getting the Certificate of Recognition, Startups can apply for tax exemption under Section 80 IAC of the Income Tax Act.?
Objectives of Startup India Registration
The Startup India Movement has set forth the following objectives in its plan to provide support to Startups and beyond:
- Improved infrastructure, which includes the establishment of good centers.
- Streamlined facilitation of Intellectual Property Rights (IPR), making the process of patent filing more accessible.
- Creating a favorable regulatory environment that encompasses tax benefits, simplified compliance procedures, streamlined company setup, and efficient mechanisms.
- Aiming to enhance funding opportunities for Startups.
- Providing an extensive networking database for entrepreneurs and other stakeholders involved in the Startup ecosystem.
Documents Required For Startup India Registration
The required documents for Startup India Registration include:
- Incorporation/Registration Certificate of your Startup
- Proof of funding, if applicable
- Authorization letter of the owner of the company, LLP, or partnership firm
- Proof of concept, such as a pitch deck, website link, or video (for Startups in the validation, early traction, or scaling stage)
- Details of patents and trademarks, if any
- List of awards or certificates of recognition, if received
- PAN Number (Permanent Account Number)
Process of Startup India Registration
The procedure for registering a Startup involves the following steps:
- Step 1: First, you need to start your business as a Private Limited Company, Partnership firm, or Limited Liability Partnership (LLP). This requires following the standard registration procedures such as submitting the registration application and obtaining the Certificate of Incorporation or Partnership registration. You can file the registration application with the Registrar of Companies (ROC) for a Private Limited Company or LLP, or with the Registrar of Firms for a Partnership Firm. The necessary documents and fees must be submitted along with the application.
- Step 2: After incorporating your business, you should register it as a Startup. This process can be completed online. On the official website click on the ‘Register’ button to register into your profile. Once your profile is set up, you can apply for various acceleration, incubator/mentorship programs, challenges, and access resources like learning programs, government schemes and state policies.
- Step 3: The next step is to obtain recognition from the Department for Promotion of Industry and Internal Trade (DPIIT). This recognition provides your startup with many advantages such as access to intellectual property services, relaxation in public procurement norms, self-certification under labor and environment laws, easy winding up of the company, access to the Fund, tax exemptions, and more. You need to apply for the Department for Promotion of Industry and Internal Trade (DPIIT) Recognition from your registered profile on the Startup India website.
- Step 4: You need to complete the Startup Recognition form by providing detailed information about your entity including the full address, authorized representative details, directors/partners details, Startup activities, and self-certification.
- Step 5: After getting the application submitted you will receive a recognition number for your startup. The recognition number is issued after the verification of your uploaded documents, normally it will take 2 days to verify after submitting the documents. It is important to ensure that you upload authentic documents. If any forged document is uploaded then you might face the penalty as per government laws.?
- Step 6: If you require patents, trademarks, or design registrations for your innovation or business then you need to approach the professional experts.
Validity of Startup India Registration
The Startup India Registration certificate remains valid for 10 years starting from the registration of the company, but it must be considered that the validity may also cease if the company achieves a turnover of more than 100 Crores before the expiration of the 10 years.
FAQ’s
Q1. What is the eligibility of a Start-up in India??
Ans. These are the eligibility of a Start-up in India:
Existence of Company: The company’s existence and operations should not exceed a period of 10 years from the date of its starting.
Company Classification: ?For the DPIIT Certificate your company should be Private Limited Companies, Limited Liability Partnerships (LLPs), or Registered Partnership Firms.
Annual Turnover: The turnover of the company should be less than Rs. 100 crores for any financial year.
Original Entity: The company should not be split or restructured an already existing company in order to get the DPIIT certificate of Recognition.?
Innovative & Scalable Entity: The company should be involved in the development or improvement of a product, process, or service that is different from innovation. It should create wealth and generate employment for the public.?
Potential for Employment and Wealth Creation: The company should have the capability to generate employment opportunities and create wealth.
Q2.? What are the features of Start-up India??
Ans. Following are the benefits of Start-up India Registration:?
- Self-Certification
- Application of Start-Up Patent
- Simplified Regulations for Government Purchasing
- Credit Guarantee Fund Rs. 2,000 crore?
- Tax Exemptions
Q3. What is the process of Start-up India registration??
Ans. Following are the process of Start-up India registration:
- Step-1: Business Incorporation
- Step-2: Register with DPIIT
- Step-3: Obtain DPIIT Recognition
- Step-4:? Recognition Application Complete?
- Step-5: Recognition Number?
Q4.? What is the main objective of establishing a startup scheme in India??
Ans. These are the main objective of establishing a startup scheme in India:
- Improvement of the infrastructure, which includes the establishment of good offices.
- Simple the facilitation of Intellectual Property Rights (IPR), making the process of patent filing more accessible.
- Making a good regulatory environment that encompasses tax benefits, simplified compliance procedures, streamlined company setup, and efficient mechanisms.
- Its main goal is to enhance funding opportunities for Startups company.
- Providing an extensive networking database for entrepreneurs and other stakeholders involved in the Startup ecosystem.
Q5. What is the validity of Startup Registration?
Ans. The Startup India Registration certificate is valid for 10 years starting from the registration of the company.
Q6. When Start-up India is established in India???
Ans. The Government of India started a new initiative of Startup Scheme in 2016.?
