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Tax Exemptions, Eligibility and Incentives for Startups in India

tax exemptions

The Prime Minister of India, Shri Narendra Modi announced some visionary goals to enhance the Startup ecosystem in the country. Promoting the Startup ideology, the PM brought up the Startup India initiative. The initiative is proposed to fulfil the needs of struggling entrepreneurs and encourage them to work in a more feasible manner. Notedly, the Budget 2016 also had a different section for the tax benefits and exemptions for new startups. The Government aims to boost the economy with the help of technology and consumer-oriented startups.

The Government has also issued an action plan that lists around 19 points that could help the startups grow at a faster rate. The action points comply with the easy launch of mobile app and website, self-certification, startup India community, low-cost patent examination, proper funding support, fast exits, etc. The Startup India action plan term “Startup” as an individual entity which has to be registered with the Government of India (not prior to 5 years) and the annual turnover should not exceed 100 crores in any financial year. It shall be working in the field of development and making products for the welfare of society with the help of innovation and technology.

Tax Exemptions for the Startups, Effective from 2017-18

Following Tax exemptions for the startups have been introduced that will be effective from 2017-18. The proposed incentives and exemptions are:

Eligibility Conditions for Startups in India

There are certain eligibility conditions for the Indian startups that will ensure their best collaboration with the Government of India. To be considered as eligible, the startup should be:

Recommended: GST Benefits for Startups in India

Tax Exemptions in Indian Union Budget 2016 under Startup India Campaign

The Union Budget 2016 highlighted some major tax exemptions for startups in India. The exemptions come under the Startup India campaign. Take a glance at the budget 2016 highlights that focus on boosting the startup ecosystem in the country.

With such tax exemptions for Startup India, the Government aims to produce a better environment for new businesses and entrepreneurship. The tax relaxation for three years has brought up certain enthusiasm and the Indian entrepreneurs need not worry about the downfall and should feel free to take the risk in the market. The Government will provide all kinds of support and aid to the Startups that lie under the above-mentioned eligibility criteria.

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