A Comprehensive Guide to Startup Business Company Registration
In the ever-evolving landscape of business, the concept of startups has gained immense prominence, catalyzing innovation, employment generation, and economic growth. The Indian government, recognizing the pivotal role of startups, introduced the Startup India Scheme on January 16, 2016. This initiative aims not only to foster the spirit of entrepreneurship but also to provide a conducive environment for startups to thrive. One of the integral components of this scheme is the process of Startup Business Company Registration.
Understanding Startup Eligibility:
According to the revised announcement of May 23, 2017, an organization qualifies as a startup if:
- It is incorporated in India as a private limited company, registered as a partnership corporation, or a limited liability partnership.
- It is within ten years from the date of its incorporation/registration, or for biotechnology startups, up to ten years from the date of incorporation/registration.
- Its annual turnover for any financial year since incorporation/registration does not surpass Rs. 100 crores.
- It is actively working towards innovation, development, or improvement of products, processes, or services, demonstrating a scalable business model with high potential for employment generation or wealth creation.
Notably, organisations created by splitting up or reconstruction of existing commerce do not qualify as startups. Additionally, for startup recognition and eligibility for a Tax Exemption certificate, a startup should not be more than 10 years old or incorporated before April 2016.
Read also this -: Why Should I Register my Company TodayBenefits of the Startup India Scheme:
The Startup India Scheme, initiated by Prime Minister Narendra Modi, is a catalyst for the promotion of startups, employment generation, and wealth creation. The benefits include:
1. Recognition as Startups by DPIIT:
Eligible organisations can get recognized as startups by the Department for Promotion of Industry and Internal Trade (DPIIT). This recognition opens doors to various advantages, including tax benefits, easier compliance, and fast-tracking of Intellectual Property Rights (IPR).
2. Financial Support:
Startups enjoy financial benefits, including an 80% reduction in patent registration fees, making the process more accessible and affordable. The government also facilitates the payment of facilitator fees for obtaining patents.
3. Tax Benefits:
Startups can avail themselves of income tax benefits under Section 80 IAC of the Income Tax Act, providing tax holidays for three consecutive financial years out of the first ten years since incorporation.
4. Registration Benefits:
The registration process for startups is streamlined, with a single meeting arranged through the Startup India hub. A dedicated doubt and problem-solving window enhances the registration experience.
5. Government Tenders:
Startups can participate in public procurement through tenders, with relaxation in criteria such as prior experience, Earnest Money Deposit (EMD), or turnover.
6. Huge Networking Opportunities:
The government organizes two startup fests annually, both nationally and internationally, providing a platform for various stakeholders to connect. Intellectual Property awareness workshops are also part of the scheme.
Advantages of Startup Business Company Registration:
The advantages of Startup Business Company Registration are multifaceted:
Startups are allowed to self-certify compliance with six Labour Laws and three Environmental Laws through a simple online process.
No inspections for labour laws are carried out for a period of five years, with inspections conducted only upon receiving a credible and confirmable grievance of infringement filed in writing.
Startups falling under the white category can self-certify compliance with environmental laws, with only random checks conducted in such matters.
Eligibility and Registration Process:
To be eligible for Startup India registration, the entity must be a private limited company, LLP, or partnership firm, offering innovative products or services. It should be registered for not more than ten years, with a business model having high potential for employment generation or wealth creation, and an annual turnover not exceeding Rs. 100 Crore.
The registration process involves:
1. Incorporate Your Business:
Follow the standard procedure to incorporate your business as a Private Limited Company, LLP, or Partnership Firm.
2. Register Under Startup India:
For Startup Business Company Registration, complete the registration process under the Startup India scheme on the official website, providing necessary details and uploading required documents.
3. Upload Required Documents:
Upload documents such as Certification of Incorporation, MOA & AOA, List of Directors or Designated Partners, contact details of Directors/Partners, information related to awards/certificates, details of investment and investors, details of Intellectual Property Rights Registration, website link/mobile app link, Udyam Registration/MSME Registration, and the business plan & growth plan.
4. Tax Exemption Declaration:
If seeking tax exemption, declare the same in the application.
5. Self-Certification:
Self-certify compliance with the specified conditions, including business type, incorporation period, turnover, and innovation focus.
6. Get Your Recognition Number:
Receive a recognition number immediately upon application submission. The certificate of registration or incorporation follows after a thorough review of uploaded documents.
Read also this -: The 7 Steps to Register Your Startup in IndiaHow LegalRaasta Facilitates Startup India Registration?
LegalRaasta serves as the premier business and legal services platform, offering specialized assistance for Startup India registration. Services include One Person Company (OPC) registration, Partnership, LLP registration, Public Limited Company registration, Nidhi Company Registration, Section 8 Company Registration, and FSSAI registration. With the help of our experts, entrepreneurs can seamlessly navigate the process of startup registration and access the myriad benefits provided by the government.
In conclusion, the journey of registering a startup under the Startup India Scheme is a transformative step towards unlocking a world of opportunities. From financial benefits to tax exemptions, streamlined registration processes to networking opportunities, the advantages are diverse and impactful. As the government continues to champion the cause of entrepreneurship, startup registration stands as a beacon for those looking to innovate, create employment, and contribute to the economic fabric of the nation. Embrace the Startup India initiative, embark on your entrepreneurial journey, and let LegalRaasta be your guide in this exciting venture.
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