Startup India Registration
What is a startup?
Startup India Registration- A startup is newly established, usually small business started by one or a group of people. What separates it from other new businesses is that a start-up provides a new product or service that is not provided in the same way elsewhere. Innovation is the keyword. The company either develops a new product/service or redevelops something different into an existing product/service.
What is Startup India?
Startups in India are becoming very common. The Government of India, under the leadership of PM Narendra Modi, has initiated and supported Startup India initiative to recognize and encourage startups in order to develop the Indian economy and attract talented entrepreneurs.
How to register your startup with Startup India
Step 1: Incorporate your business
Next, you should establish your business as a private limited company, a corporation or a joint partnership.
You should follow all standard registration procedures for any company, such as obtaining the Incorporation / Partnership registration certificate, PAN, and other appropriate enforcement.
Step 2: Register with Startup India
The business must then be licensed as a start-up. The whole system is online and quick. All you need to do is log in to the website of Startup India and fill in the form with your company information and upload some documents.
Step 3: Documents to be uploaded (in PDF format only)
- a) A letter of recommendation/support
A letter of recommendation with the registration form must be submitted. All below will be valid-
- A recommendation (regarding the innovative nature of business) from an Incubator formed at a post-graduate college in India, in a format defined by the Department of Industrial Policy and Promotion (DIPP);
- A letter of support from an incubator funded by the Government of India (in relation to the project) as part of any particular innovation promotion scheme;
- A letter of recommendation (in terms of business creative nature) from an Incubator recognized by the Government of India in a format specified in DIPP;
- A letter of funding of not less than 20 per cent in equity from any Incubation Fund / Angel Fund / Private Equity Fund / Angel Network, properly registered with SEBI, supporting the business ‘ creative nature;
- A letter of funding from the Government of India or any Government of any State as part of any particular innovation promotion scheme;
- A patent filed by the Indian Patent Office and published in the Journal in areas specific to the nature of the business being promoted.
- b) Incorporation/Registration Certificate
You need to submit your company / LLP incorporation certificate (Partnership Registration Certificate)
- c) Description of your business in brief
A brief description of the innovative nature of your products/services.
Step 4: Answer whether you would like to avail tax benefits
Startups are 3 years free from income tax. But in order to take advantage of these advantages, the Inter-Ministerial Board (IMB) must approve them. DIPP-recognized start-ups, Govt. In India, IPR-related benefits can now be directly available without requiring additional IMB certification.
Step 5: Finally, you must self-certify that you satisfy the following conditions
- You should declare the new company as a private company, a partnership or a limited partnership
- You should incorporate/register your company in India, not before 5 years.
- Turnover must be less than 25 crores per year.
- Innovation is a must– the organization must strive to invent something new or to dramatically improve the existing software used.
- The separation or restoration of an existing business must not result in your business.
Step 6: Immediately get recognition number
That’s all there is! You will receive an immediate recognition number for your company when you apply. After all the records are checked, the certificate of recognition will be given.
Be patient, though, when uploading the files. If it is found on subsequent verification that the required document is not uploaded /the wrong document uploaded or that a forged document has been uploaded, you will be liable for a fine of 50% of your paid-up start-up capital with a minimum fine of Rs. 25,000.
Step 7: Other areas
- a) Patents, trademarks and/or design registration
If you need an invention patent or a trademark for your company, you can easily access anyone from the government’s list of facilitators.
- b) Funding
Access to finance was one of the primary challenges facing many startups Entrepreneurs fail to attract investors due to lack of experience, security, or existing cash flows. In reality, many investors are compensated by the high-risk nature of startups as a significant percentage fail to take off. Startup India Registration
Government has formed a fund with an initial corpus of INR 2,500 crore and a cumulative corpus of INR 10,000 crore over a 4-year period (i.e. INR 2,500 crore per year) to provide funding aid. The Fund is in the form of Fund of Funds, meaning it will not invest directly in Startups but will participate in SEBI’s registered Venture Funds capital.
Key features of the Fund of Funds
- The Fund of Funds is operated by a committee of industry professionals, academics, and innovative entrepreneurs.
- Life Insurance Company (LIC) is a co-investor in the Trust.
- The Fund of Funds shall contribute up to 50 per cent of the Venture Funds (“daughter funds”) registered by SEBI. The daughter fund should have increased the balance by 50 per cent in order to receive the donation. The Fund of Funds will have members depending on the contribution made on the board of the venture fund.
- The Fund would fund a large mix of sectors such as manufacturing, agriculture, health, education, etc.
Due to the various government programs, it is very easy to register as a company. Nonetheless, you should concentrate on your key area while we at ClearTax support you to get your startup recognition right from start to finish. Visit our website for more information on start-up services
FAQ Startup India Registration
Can I start a business without registering it?
When you start a business without reporting it, even if you don’t want to be one, you’ll be called a sole trader. Businesses are required to register and receive a business license in most states before they can operate legally, but this is different from forming or establishing a business.
How do you register a startup company?
- Step 1: Incorporate your business. …
- Step 2: Register with Startup India. …
- Step 3: Documents to be uploaded (in PDF format only) …
- Step 4: Answer whether you would like to avail tax benefits. …
- Step 5: Finally, you must self-certify that you satisfy the following conditions.
Can I start a business without registering it in India?
The answer is no! It is not the only way to start a company in India to register a company. … The best way to start your own business is to buy any tax permit, such as service tax registration
Can I sell products without registering as a company?
Yes, starting to sell products without registering as a business is legally feasible. The issue is the collection of payments and taxes. Without a business registration, you can’t open a current account. Through registration, you can start slowly and choose the legal way when you start to gain traction.
Is it illegal to have an unregistered business?
In addition, many companies are not going to do business with an unregistered company.
How do I register my business legally?
- Use a Doing Business As (DBA) The easiest way to register a business is to file a DBA, also sometimes called registering a fictitious business name, with your state or county clerk’s office. …
- Create a Business Structure. …
- Register a Trademark.
Do I need to register my small business?
It is usually not mandatory to register one-person businesses that operate as a sole proprietorship. You would usually also need to file with your state for any more complex business form such as a limited liability company (LLC), limited liability partnership (LLP) or corporation.