Startup India is a flagship initiative of the Government of India to support new businesses and innovation. It was launched on 16 January 2016, and India now has one of the world’s largest startup ecosystems. A key step for founders is getting recognised as a startup by the Department for Promotion of Industry and Internal Trade (DPIIT). Here is a guide.
Who is eligible
An entity can be recognised as a startup if:
- It is a private limited company, a registered partnership firm or a limited liability partnership.
- It is not more than 10 years old from the date of incorporation.
- Its turnover has not exceeded Rs 100 crore in any financial year.
- It is working towards innovation, development or improvement of products, processes or services, or has a scalable business model with potential to create jobs or wealth.
- It is not formed by splitting up or reconstructing an existing business.
Benefits of recognition
- Self certification: under certain labour and environment laws, reducing inspections.
- Faster patents: fast tracked patent applications and a large rebate on patent filing fees, with facilitators to help.
- Easier public procurement: relaxed norms on prior experience and turnover in government tenders.
- Easier exit: faster winding up under the insolvency law for eligible startups.
- Funding: access to the Fund of Funds for Startups managed by SIDBI, which invests through SEBI registered funds, and the Credit Guarantee Scheme for Startups.
Income tax exemption
Eligible recognised startups can apply to the Inter Ministerial Board for a tax holiday on profits for three consecutive years out of their first ten years. The Union Budget 2025 extended the incorporation deadline for this benefit to 1 April 2030. The Budget 2024 also abolished the so called angel tax for all classes of investors.
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How to apply
- Register on the Startup India portal.
- Incorporate your business as a company, LLP or partnership, if not already done.
- Fill the DPIIT recognition form with business details, a description of the innovation and documents like the incorporation certificate.
- Submit and track the status online.
Once approved, you receive a recognition certificate and number.
Other support
- Startup India Seed Fund Scheme: early stage funding through incubators.
- Startup India Hub: a portal for mentorship, learning programmes and networking.
- National Startup Awards: recognising outstanding startups.
- States also run their own startup policies with extra benefits.
National Startup Day
The government observes 16 January as National Startup Day to mark the launch of Startup India.
Bottom line
DPIIT recognition is the gateway to Startup India’s benefits, from tax exemption and faster patents to funding. Eligible founders can apply online on the Startup India portal.
Source / स्रोत: Startup India, DPIIT, Department for Promotion of Industry and Internal Trade, Press Information Bureau
