A step by step guide on how to register a startup company in India. Know the documents required, eligibility criteria, benefits of startup india scheme, registration process & more.
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How to register a startup in india
1. How To Register A Startup In India
"The society we live in is blessed with an abundance of creativity & entrepreneurial spirit."
Having said this, with each passing hour, we are marching towards an AI-first world
and this is a great time for tech startups to make their mark. The Venture Capital
Firms & Investors are having a close eye towards all the novel ideas that can be turned
into reality. As the new motto says - "Dream Big, Act Now."
In this blog, we will be discussing how to do a startup in India.
A start-up is defined as a company or a project initiated by an entrepreneur to seek,
develop, and validate a scalable business model. Entrepreneurship refers to all new
businesses, including self-employment and businesses that never intend to become
registered, whereas startups refer to the new businesses that intend to grow large
beyond the solo founder.
Startups & Small Business Statistics In India
Did you know that India is the 3rd largest startup ecosystem in the world? India is
expected to witness year-over-year (YoY) growth of a consistent 12-15%.
The Indian government defines a startup as an entity less than seven years young with
an annual turnover of less than 250 million rupees and headquartered in India.
Our beloved PM Narendra Modi announced the Start-up India campaign in 2016 to
promote and encourage entrepreneurship. This mainly revolves around financing,
incorporation, tax exemptions etc, to ease the functioning of startups. With these
benefits being provided by the Government, the majority of the start-ups have young
owners, this shows the diversity and volumes of talents that India has.
2.
3. Now that you have a better understanding about a startup, let us look into the Startup
in India scheme.
According to the revised announcement on 23rd May 2017, an organization will be
considered as a Startup, if it is incorporated in India as a private limited company (as
defined in the Companies Act, 2013) or registered as a partnership
corporation (registered under section 59 of the Partnership Act, 1932) or a limited
liability partnership (under the Limited Liability Partnership Act, 2008).
An organization created by splitting up or reconstruction of existing commerce will
not be considered a 'Startup'.
What Are The Eligibility Criteria For Startup Registration In India?
The following conditions must be fulfilled in order to be eligible as a Startup :
Being incorporated or registered in India for less than seven years and
for biotechnology startups up to 10 years from its date of incorporation.
Annual turnover not exceeding Rs 25 crores in any of the preceding
financial years.
4. Aims to work towards innovation, development, deployment, or
commercialization of new products, processes, or services driven by
technology or intellectual property.
It is not formed by splitting up or reconstruction of a business already in
existence.
It must obtain certification from the Inter-Ministerial Board set up for
such a purpose.
It can be incorporated as a private limited company, a registered
partnership firm, or a limited liability partnership.
Benefits Of Startup India Scheme
The Indian Government has come up with various schemes to promote startups. The
stated vision is to transform India from a nation of job seekers to job creators. To
fulfill this vision the GOI has launched the scheme viz Startup India registration under
DIPP (Department of Industrial Policy and Promotion) under the Ministry of
Commerce and Industry.
5. This scheme supports Startups by providing various benefits to the registered entity.
The benefits include financial as well as non-financial benefits. To register under this
scheme the entity must fulfill the criteria specified.
The benefits include :
Administrative and tax benefits.
Capital gains exemption.
Government help for startup funding.
Self- certification compliance framework with regard to labor and
environmental laws. (startup's businesses would be excluded from any
inspections of the place of business from up to 3-5 years.)
Qualified to incorporate 80% reduction patent registration fees and 50%
reduction in the trademark filing.
Benefited by free of cost legal help in conjunction with simplified entry
and exit norms and protection of Intellectual Property Rights (IPR).
Read more → Startup India Tax Exemptions
The Registration Process Of A Startup In India
6. The startup can be registered as:
Partnership Firm: To start a partnership firm, the parties have to draft a
partnership deed where the terms and conditions of the partnership firm
shall be mentioned. This partnership deed must be registered with the
registrar of firms. We can assist you with partnership formation. Click
below to know more https://adca.in/partnership-registration-
bangalore.php
Limited Liability Partnership Firm: Limited Liability Partnership(LLP) as
the name indicates, is a partnership firm with an additional feature of
partner liability is limited. For income tax purposes LLPs and partnership
firms are treated at par. The Ministry of Corporate Affairs is the
registration authority for LLPs. For more details on LLP registration,
click here. https://adca.in/llp-registration-bangalore.php
Private Limited Company: Private Limited Company is the most preferred
structure for businesses that plan to grow big, get investments by way of
7. equity, wish to offer sharing of ownership with employees by way of
ESOP, wish to get FDI, etc. The major advantage of Private Limited
structure is the segregation of management from ownership. Directors
form the management of the company, and Shareholders are the
owners of the company.
The online registration process of a startup in India
Log on to Startup India Portal
Enter the required details
Enter the Details of Directors and Partners.
Upload the essential documents and Self-certification in the prescribed
manner.
File the Incorporation/Registration certificate of the company.
Documents required for a startup registration in
India:
8. Memorandum of Association for Pvt. Ltd. / LLP Deed
Board Resolution (If Any)
Annual Accounts of the startup for the last three financial years
Income Tax Returns for the last three financial years
How to check your startup India registration status
Refer to your Dashboard on the Startup India Portal for the status of your application.
This can be found on the top right of the page after you log in.
You can read more about startup registration here.
For any concerns related to the same, you can get in touch with us. Our team of
experts will help you with the Startup Company Registration in Bangalore.