Startup India

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START UP INDIA Boon for Start-ups
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What is a start-up? Startups are formed
primarily with the intention of fast growth and
to offer something to a very large market. On the
other hand small business ventures are set up to
offer products and services to a niche market.
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How can my venture get recognized as a
start-up? Here is the list of specifications to
be fulfilled in order for a business to be
considered as startup. It can be termed as the
salient features of startup and unless each of
these requirements is met, it cannot be legally
termed as a startup rather it will be a small
business venture.
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Start-up entity/business These are specific type
of businesses that are technology oriented with
the aim of high growth potential. Financing will
be the most challenging task of have a startup.
The reason for this is investors will expect
highest potential rate of return on their
investment.
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• Age of company
• Here are some of the factors which can turn a
  company to be not a startup from being startup.
• 100 or more employees
• 3000 revenue run rate (forward 12 months)
• Worth more than Rs. 30,00

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Annual turnover of start-ups Turnover rates
from each industry is different, thus annual
turnover for all startups cannot be collaborated.
However, if the overall annual turnover of any
business is over Rs. 30,000 million, then it
cannot be termed as a startup anymore.
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Highly innovative product or service Innovation
is the key for any startup venture. Instead of
spending millions of upgrading the systems and
functions, it is necessary to think innovatively
to make use of the resources available to
generate more revenue.
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No splitting of existing company allowed If you
already have existing companies, splitting it to
enjoy the benefits of startup firm is not
allowed. A business split to be termed as startup
is considered as illegal.
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• Tax exemptions for the start-ups, effective from
  2017-18
• Under Section 80-IAC, the Startup incorporated
  after April 1, 2016 is eligible for getting 100
  tax rebate on profit for a period of 3 years.
  Also, the annual turnover must not exceed Rs. 25
  crores in any financial year upto 31 March 2021
• The startups have to pay Minimum Alternate Tax
  MAT at 18.5 along with the applicable
  surcharge and cess.

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• Exemptions have been made against capital gains.
  Long term capital gains (LTCG) will be invested
  by the Governments special funds. The investment
  may go up to INR 50 Lakh and the exemptions will
  be applied for three years
• If the individual holds 50 equity then the
  company may utilize the invested amount for
  buying assets before the due date of filing the
  return

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• The domestic companies who hold turnover less
  than INR 5 Crore in the FY 2014-15 will be liable
  for 29 tax along with surcharge and other cess.
  It will be covered under the chapter VI-A
• The Finance Minister has also proposed different
  taxes for the new domestic manufacturing
  companies that have been setup on or after 1st
  March, 2016. Such companies will be taxed at 25
  plus with cess and surcharge. The tax is proposed
  on the conditions if the company do not claim any
  incentives under profit or investment

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Startup India Scheme There is a mobile
application made available by PM Narendra Modi
which can be used for registering for a Startup
India Scheme. The biggest benefit for webpreneurs
and entrepreneurs is there is tax exemption for
the first 3 years of the startup being launched
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• Key incentives of Startup India Scheme
• Here are some of the key reasons why Startup
  India Scheme is encouraged among young
  generations.
• Compliance based on self-certification
• Startup India hub
• Rolling-out of mobile app and portal as a
  regulatory facilitator
• Legal support and fast track patent application
  at lower cost
• Relaxed norms for public procurement of start
• Faster exit for start-ups

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• Providing funding support
• Credit guarantee fund for start-ups
• Tax exemption on capital gains
• Tax exemption to start-ups for three years
• Tax exemption on investments above fair market
  value
• Industry academia incubation and partnerships

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• Details that should be furnished for Startup
  Recognition to claim benefit are listed.
• Nature of the Entity
• Sector
• Name of the Entity
• Incorporation / Registration No.
• Incorporation / Registration Date
• PAN
• Full Office Address
• Authorized Representative Details

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• Details of Directors
• Supporting Documents and Self-Certification
• Incorporation/ Registration Certificate
• Brief note on innovativeness of products
  /services offered by the entity
• Confirm if you like to avail Tax benefits?
• Certification

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Apart from these make sure you are not getting
carried away by the blockbuster ideas that will
come up in brain storming, always think through
everything from a realistic and practicality
perspective. Focus on the execution of what is in
plan and then look out for way to expand and
enhance the performance.