A startup is a business managed by the collection of a few people that solves a problem.
Such companies come into formation when the founders find some negatives in the existing system they have been working in and intend to solve the issues by creating a new company of their own.
Apart from this, a startup can also come into existence when the founder(s) come with a potentially great idea. The services such startups provide are the services they think currently exist in inferior quality or do not exist at all.
The biggest advantage of a startup is that it improves employment in the country as it is the direct result of more and more companies coming up. With the possibility of increased job opportunities, the Indian government has tried to help young companies grow and thrive in the Indian market. The Startup India initiative helps you to innovate and improve economic sustainable development.
Now that you have a better idea about what a startup is and what Startup India talks about, let us look into what all companies qualify as a Startup in India.
What makes you a startup under the Startup India program?
First things first, you need to incorporate your business as a Private Limited Company or a Limited Liability Partnership or a Partnership firm. You just need to follow the normal procedure that includes you filling up a form to get the registration.
Now you need to register your firm or company as a startup in the Startup India scheme of the government. You just need to fill the form available for you on the Startup India website. You have to fill in all the details and upload a certain number of documents as well.
You need to upload the certificate of incorporation of your company or LLP, or the registration certificate for a partnership company.
In India, startups do not have to pay income tax for the first three years but to avail such benefits, the company must be certified by the Inter-Ministerial Board (IMB). This is where companies registered with DIPP get relaxation as the registration is enough to get the benefits.
On application of this registration, you will get a recognition number with immediate effect. You get the certificate of registration or incorporation only after the authority goes through all your uploaded documents.
You need to be careful while uploading the data, as any discrepancy in it can cause you a huge fine of up to 50% of your paid-up capital or Rs 25,000 at the very least.
Now that you know the eligibility and registration criteria for a startup, enroll your company as well into the Startup India scheme and reap all the benefits provided by the government.