The Startup India Scheme has a multitude of benefits for those who are planning to begin theirstartup venture or those who already have a startup. Let’s have a look at these variousadvantages that the scheme presents to startups. To name a few:
- Reduced regulatory work – This scheme is allowing Self Certification under 9 labor laws and environmental laws via a mobile application. No inspection will be conducted for a period of 3 years from the date of incorporation. This will reduce the burden of regulatory work significantly.
- Income tax relief – If you are a startup that has been granted with an inter-ministerial board certificate under section 80-IAC of the income tax, then the profits earn will be exempted from income tax for a period of three years. Furthermore, any income/premium that is made by incubators or investor of a higher value than that of the market price will be exempted from income tax. Note: It is only applicable to startups Incorporated on or after 1st April 2016 but before 1st April 2021
- Rebate on patent application – A great advantage of registering under this scheme is that it eases the cumbersome process of patent protection that new startups have to go through. The patent applications are subjected to a fast – track examination and a rebate of 80% of the total value of the patent fee is granted when the patent has been filed.
- Rebate on trademark application – This scheme also provides a 50% rebate of government fees while filing trademark application.
- Assistance on Intellectual Property application – The scheme also provides resources and a panel of facilitators to help in the IP application filing process as well as support to bear the facilitation costs.
- Quick wind-up – An easy winding-up process for the company is provided. Startups that are also known as fast track firms are allowed to be wound up within 90 days under this scheme as compared to 180 days under normal circumstances. An insolvency professional is also appointed for liquidating the assets and paying creditors within six months of filing an exit application.
- Relaxed norms on Govt. Tenders – The norms for Public Procurement are considerably relaxed under this scheme. Earlier, prior experience and a requisite turnover were necessary for a company that opted to go for public procurement. However, Startup India has levelled the playing field for both new startups and experienced entrepreneurs by providing relaxation in public procurement norms. Now, a startup can avail for exemptions on earnest money deposit, prior turnover and experience requirements in case of Government tenders.
- Listing on Govt. e- Marketplace (GeM) – Startups can be listed as sellers on the Government- Marketplace (GeM), which is Indian Government’s largest e- procurement portal.
- Access to SIDBI funds – An important provision of this scheme is the SIDBI Fund of Funds, wherein a corpus fund of Rs.10,000 crore has been set aside by the Government. This fund contributes to the SIDBI registered funds. These funds further invest in startups to provide equity funding support.
- Incubation and mentorship – This scheme presents the startups with a number of networking options as well. It facilitates the meet-up of startup stakeholders through a fest that is organized twice a year.
- Various other infrastructure facilitation – The Startup India Scheme is also facilitating Research and Innovation through the establishment of research parks and incentives for innovation.
The advantages that accrue to being registered under the Scheme are multi-faceted and numerous, whereas drawbacks none. Therefore, every Startup must sign up for the same and make the most of the opportunity to experience accelerated growth.
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