START UP Registration

Funding support & Incentives

• Provide funding support to startups: The Government will set up an initial fund of Rs.2,500 crore per year and a total of Rs.10,000 crore over a period of 4 years

• Credit Guarantee for Startups: To encourage Banks and other Lenders to provide Venture Debts to startups, Credit guarantee mechanism through National Credit Guarantee Trust Company (NCGTC)/ SIDBI is being considered with a budget of Rs.500 crore per year for the next four years.

• Tax Exemptions on Capital Gains: To promote investments into Startups, the Government will give tax exemption to those who have capital gains during the year and have invested such capital gains in the Fund of Funds recognized by the Government.

• Tax Exemption to Startups for Three Years: To address the working capital requirement, stimulate the development of Startups in India and provide them a competitive platform, the profits of Startups will be exempted from Tax for a period of 3 years.

• Tax Exemption on Investments over Fair Market Value: Investment by incubators in Startups will be exempted from Tax.

Simplification & Handholding

• Compliance regime based on self-certification: The idea is to reduce the regulatory burden on startups, so that they can focus on their core business and keep the cost of compliance low. The regulatory regimes will thus be made simpler and flexible; inspections more meaningful and simple.

• Startup India Hub: Creation of a single point of contact for the entire startup ecosystem to enable the exchange of knowledge and access of funding. The Government will be the main stakeholder and will collaborate with Central and State Governments, Indian and foreign VC's, angel networks, banks, incubators, legal partners, consultants, universities and R&D institutions.

• Rolling Out of Mobile App and Portal: It will act as an interacting platform for startups with the Government and regulatory institutions. This will be made available from 1st April, 2016 on all leading mobile/ smart device platforms.

• Legal Support and Fast: Tracking Patent Examination at Lower Costs- To promote and create awareness in startups about IPRs and ensure continuous growth and development of new startups, this scheme will make the task of filing patents easier.

• Relaxed norms of Public Procurement for Startups: The aim is to provide equal opportunity to Startups as compared to experienced companies. The Government will exempt startups from the criteria of 'Prior experience/ Turnover' in case of tenders floated by Government or by PSU's, without relaxation in the quality parameters.

• Faster Exit for Startups: The Action Plan will make it easier for Startups to wind up operations in case they fail to succeed. An insolvency professional will be provided to the Startups, who will be in-charge of the company for liquidating the assets and paying the creditors in six months time. This process will accept the concept of limited liability.