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Frequently Asked Questions
What is Startup India and why was it launched?
Startup India is a flagship initiative launched by the Government of India in 2016 to build a strong ecosystem for innovation and entrepreneurship. It aims to empower startups by offering tax benefits, ease of doing business, and support through funding and incubation.
Who is eligible to register under the Startup India scheme?
Entities must be registered as a private limited company, partnership firm, or LLP, and be less than 10 years old with annual turnover not exceeding ₹100 crore. The business must work towards innovation, improvement of products or services, or scalable development.
What is DPIIT Recognition and how does it benefit startups?
The Department for Promotion of Industry and Internal Trade (DPIIT) grants recognition to startups, enabling them to avail tax exemptions, easier compliance, faster patent application processing, and funding support under various government schemes.
How can a startup apply for DPIIT Recognition?
Startups can apply online through the Startup India portal by submitting incorporation details, a brief about the innovation, and required documents such as PAN, company registration, and a brief pitch.
What are the tax benefits offered under Startup India?
Eligible startups can avail of income tax exemption under Section 80-IAC for three consecutive years and exemption on capital gains and investments above fair market value under Section 56 (Angel Tax exemption).
Is there any government funding available through Startup India?
Yes, the Government supports startups through the Fund of Funds for Startups (FFS) and Startup India Seed Fund Scheme (SISFS), which provide funding support via SEBI-registered venture capitalists and incubators.
Do startups receive intellectual property support under this initiative?
Yes, DPIIT-recognized startups get a fast-track mechanism for patent examination, 80% rebate on patent fees, and access to facilitators who help with IP filing at subsidized costs.
Can foreign nationals or NRIs register a startup under this scheme?
Yes, as long as the startup is incorporated in India and meets the eligibility criteria, foreign nationals or NRIs can be founders or co-founders and apply for DPIIT recognition.
What are the compliance benefits for recognized startups?
Startups enjoy self-certification under labor and environmental laws, relaxed norms in public procurement, and exemptions from prior experience or turnover criteria in government tenders.
Does Startup India support women or sector-specific startups?
Yes, Startup India promotes diversity and inclusion by supporting women entrepreneurs and sector-specific initiatives such as agritech, edtech, healthtech, etc., through dedicated funds, mentorship, and incubation programs.