Startup Registration in India
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Introduction of Startup Registration
Start-up is a business that has an association of person or a group of few people that manage to solve the problems related to such business. Basically, the formation of such a start-up can be seen on the grounds when the founders of any existing company find the problems in the existing system of a company and intend to resolve such problems by creating a new company or entity of their own. Moreover, a Startup Company registration can be done when the founders of the company come up with a potentially great idea or they might come to the conclusion that the start-ups provides services currently exist in inferior or does not want to sustain it further.
Definition of Startup
Any company with the following features falls into the category of Startup and is also eligible to avail the benefits of DPIIT
Age of The Company
Company’s Date of Incorporation should not exceed 10 years
Type of Company
Either your company is a Private Limited Company under the Companies Act, 2013 or is registered under Indian Partnership Act, 1932 as a Partnership Firm or is registered under the Limited Liability Partnership Act, 2008 as a Limited Liability Partnership Firm.
Turnover Limit
Business has less than 25 crores per year turnover
A New Business Entity
The business should be new it must not be the result of split or restructure of an already existing business.
Innovation Friendly
The startup should be working towards innovation or development of new products or services or is working in the direction of improvising an existing one.
DIPP Certificate
Obtaining certificate from the Inter-Ministerial Board is essentially required; the Board is set up by the DIPP (Department of Industrial Policy and Promotion).
Benefits Obtained from DPIIT
DPIIT registered companies can avail the following benefits provided under Startup India Registration Scheme:
Simplification and Handholding
With much easier compliance and an exit process for failed start-ups, legal support has also become feasible and smooth.
Funding and Incentives
Exemption is provided on income Tax and Capital Gain Tax, apart from that funds are raised to infuse more capital into the start-up.
Incubation and Industry Academia Partnership
Developing number of incubators and innovative labs, events, competition and grants.
Benefits of Startup Registration in India
Easy Process
A mobile app and a website have been launched by the government of India for easy registration for all the startups. Any business can set up a startup by filling a simple form on the website and by uploading all the required documents. The entire registration process is completely online.
Self-Certification
The Startups under the scheme are allowed to self-certify their compliance under 6 labour laws and 3 environmental laws. Such certification is allowed for a period of 5 years from the date of the incorporation of the entity.
Easy access to funds
The government has set up 10,000 crore rupees fund to provide it as venture capital to the start-ups. The guarantee is also given by the government to the lenders to encourage the banks and other financial institutions for providing with the venture capital.
Cost reduction
A list of facilitators of trademarks and patents is provided by the government. It provides high-quality intellectual property right services including the fast examination of patents at the lower fees. The startup has to bear all the statutory fees and the government will bear all the facilitator fees. Therefore, the startup enjoys the 80% reduction in the cost of filing patents. Rendering 50% rebate on the trademark filing when compared with other companies.
Easy public procurement norms
Tax exemption
The Startups are exempted from income tax for 3 years provided that they get certification the Inter-Ministerial Board (IMB).
No time consuming compliances
The people who are investing their capital gains in the venture funds which are set up by the government shall get exempted from capital gains. This allows the startups to attract more and more investors.
Research and Development benefits
The startup India research and advocates innovation between those who project themselves as entrepreneur in the near future. The government is committed in establishing seven new research parks for the research and development of the products.
Easy winding up of the company
Startups which are also known as fast track firms can be winded up within 90 days (3 months) as against the 180 days for the other companies. Further, an appointment for insolvency professional shall be done for liquidating the assets and paying to the creditors. This shall be done within 6 months of filing an application to be allowed for such an exit.
Eligibility Criteria for Startup Registration in India
Private Limited Company under Companies Act, 2013
Limited Liability Partnership under the Limited Liability Partnership Act, 2008
Partnership Firm under the Partnership Act, 1932
The business turnover does not exceed 100 crores for any financial year since incorporation.
The business is working towards innovation, development, processes or improvement of products and services, or if it is a scalable business model with high ability for employment generation etc.
Any business will be termed a startup for 10 years from the due date of incorporation.
Documents required for Startup Registration in India
A Letter Of Recommendation
It is essential to submit a letter of recommendation accompanying with a registration form
Registration Certificate
It is essential for you to upload the certificate of incorporation of your company/LLP (Registration Certificate in case of partnership)
A Brief Description of Your Business
Provide a quick description of the innovative nature of your business.
PAN Card
PAN Card of your business
Constitutional documents
MOA & AOA in case of company and Partnership deed in case of LLP or Partnership Firm
List of Directors, DP's and Members
List of Directors or Designated partners or members along with their photographs and contact details
Steps to Register Your Startup with Startup India
1. Incorporate your Business
You must first incorporate your business as a Private Limited Company or a Partnership firm or a Limited Liability Partnership. You have to follow all the normal procedures for registration of any business like obtaining the Certificate of Incorporation/Partnership registration, PAN, and other required compliances.
2. Register with Startup India
Then the business must be registered as a startup. The entire process is simple and online. All you need to do is log on to the Startup India website and fill-up the form with details of your business.
3. Get DPIIT Recognition
The next step after creating the profile on the Startup India Website is to avail Department for Promotion of Industry and Internal Trade (DPIIT) Recognition
4. Recognition Application
Fill up the ‘Startup Recognition Form’ and submit the form
5. Recognition Number
On applying you will immediately get a recognition number for your startup. The certificate of recognition will be issued after the examination of all your documents which is usually done in 2 days after submitting the details online.
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FAQs on Startup Registration in Jaipur
To avail benefits of government schemes, entity needs to be recognized as a Startup by applying on Startup India Mobile App/portal and obtaining the certificate of recognition.
The startup certificate is valid for 5 years from the date of incorporation.
No, you just need to apply for the registration online.
You can get the certificate of recognition instantly by downloading it online from the official website after form submission.
Yes, your entity can be registered as a Startup, if you do not have your entity’s PAN.
Application process for getting certificate from IMB completes within 10-25 working days.
The registration fee for a startup shall depend on the type of company registration and shall vary from person to person.
Letter of support is a recommendation letter from the angel investors or incubators in which they declare to help the startup by providing funding or loan.
No, the application process is performed online only, so you need to fill in and submit the application form online.
Yes, a foreign national can enter into partnership under the LLP Act and register under Startup India.
Yes, One Person Company is eligible to avail benefits under the Startup India Scheme.