Startup India Registration Requirements: Register Startup

Startup India, a flagship initiative of the Government of India (GOI), aims to promote innovation and entrepreneurship by providing a platform for aspiring entrepreneurs to realize their dreams. Dream, create jobs stimulate the economic growth and access government resources, advice and resources. This article provides a detailed overview of the Startup India Registration Requirements.

What is Startup?

A startup is a company that introduces innovative products or services to solve existing problems or needs in society. It can also improve an existing product or service, improving it to offer a better solution. The essence of a startup lies in its commitment to bringing new innovative ideas and solutions to market.

What makes it different from other new businesses is that the startup offers a new product or service that is not currently available elsewhere in the same way. The driving force behind entrepreneurship is innovation and the pursuit of growth and development.

What is Startup India program?

Startup India is an effort by the GOI to promote and nurture the growth of startups in the country. Startup India’s ultimate goal is to make India one of the most vibrant startup ecosystems in the world. By enrolling in the Startup India programme, startups have various benefits, including tax exemptions, financial support and access to incubators.

Launched in 2016, the scheme has helped build a strong startup ecosystem in India, encouraged innovation and created job opportunities. Under the Startup India program, the government has taken several important measures to support and promote startups, thereby promoting the success of entrepreneurs. The Department of Industrial Policy and Promotion (DPIIT) plays a crucial role in managing the programs and initiatives of the Indian Startup Scheme.

What is the objective of Startup India Scheme?

The Startup India scheme aims to foster a thriving startup culture and create a strong and inclusive ecosystem that encourages innovation and entrepreneurship in India.

What are the Startup India Registration requirements?

To be eligible to register with Startup India, an entity must meet specific criteria. Here is a detailed breakdown of the eligibility requirements for the Startup India program:

• Age of the applicant:
  • Any Indian citizen aged 18 years or above can apply to participate programme.
• Age of the Company:
  • The maximum date of establishment of the Company is ten years.
• Type of company:
  • The company should have been established as a partnership, Private Limited Liability Company or Limited Liability Partnership (LLP).
• Annual Turnover:
  • The company’s turnover is expected to not exceed INR 100 crore in any financial year from its inception.
• Initial Entity:
  • This entity must be established initially by the founders and not by merger or reconstruction of an existing company.
• Innovative and scalable:
  • The startup must have a plan to develop or improve a product, process or service and have a scalable business model with strong potential to create wealth and jobs.

Companies attempting to develop new products or services can avail the benefits of the Startup India policy if they meet the following conditions:

• Affected startups must make efforts develop, deploy or commercialize any product or service based on the latest news, technology or intellectual property.
• Startups should aim to improve existing products or create new products to improve customer value or work processes.
• Startups should only engage in developing and marketing a single product to enrich customer value or increase workflow.

For registration and approval, startups must obtain approval from the DPIIT based on the following criteria:

• Recommendation of any incubator. Which graduate school?
• Proposal of a state recognized nursery.
• Patents are filed and published in the journals of the Indian Patent Office in a specific field of product or service.
• Registration with SEBI for startups providing financial services and equity capital.
• Letter of sponsorship from the State or central government for any program to promote innovation.

Regarding cooperative startups, 51% of the shares must be held by women or individuals belonging to the Scheduled Caste and Scheduled Tribe categories. Additionally, they should not default on any credit.

What are the benefits of Startup India Registration?

The Startup India Program offers several key benefits to registered startups, including:

• Self Certification:
  • Startups with you can easily self certify compliance with 6 labor laws and 3 environmental laws through a simple online procedure.

• Tax Exemption:
  • Recognized startups benefit from income tax exemption for three consecutive financial years within the first ten years of incorporation. They can also claim angel tax exemption under Section 56 of the Income Tax Act.

• Easy winding up of Company:
  • Startups can close their business within 90 days of applying.

• Patent application and intellectual property services:
  • Startups recognized by DPIIT will benefit significantly when dealing with patents and other intellectual property services at significantly lower costs. Startup India offers 80% discount on patents and 50% discount on trademark applications.

• Access to funding:
  • Two kinds of funds are provided by Startup India for supporting registered startups:
    • Fund of Fund for Startups (FFS)
    • India Startup Seed Fund (SISFS) Scheme 

• Easier procurement norms:
  • Ministries, departments and public sector agencies have been allowed to relax norms in all activities Government procurement for PIIT accredited startups.

How to register a Startup in India?

To incorporate a starup in India, several mandatory steps need to be followed as per startup India registration requirements. Let us look in detail.

• Step 1: Incorporating your business
  • The first step is to establish your business as a Private Limited Company, Partnership Firm or LLP.
  • This includes following standard business registration procedures, such as submitting an application and obtaining a certificate of incorporation or registering a partnership.

• Step 2: Register with Startup India
  • After incorporating your business, the next step is to register your business as a startup. This simple process can be done through online mode.
  • To get started, visit the Startup India website and click on the “Register” button. Provide your name, email id and mobile number, create a password and click on ‘Register’.
  • Next, enter the OTP sent to your email address and provide additional details, such as user type, name, and startup steps. Click the “Submit” button to create your Startup India profile.
  • By completing this registration, your business will be recognized as a startup under the Startup India program, making it eligible for various benefits and support.

• Step 3: Get recognition from DPI
  • After creating a Startup India website profile, the next important step is to get recognition from the DPIIT. This recognition gives startups access to various benefits, such as high-quality intellectual property services, relaxation of public procurement standards, self-certification of labor and environmental laws market, easy business liquidation, access to capital funds and tax exemption for startups. Three consecutive years, including tax exemption for investments in excess of fair market value.
  • To apply for PPIT Recognition, log in with your registered profile credentials on the Startup India website and click on the “Apply for PPIT Recognition” option under the “Recognition” tab. On the next page, select ‘Register as a Business or LLP’ or ‘Register as a Partnership’.
  • If you select ‘Register a Company or LLP’ you will be redirected to the National One Stop Shop System ‘NSWS’; website. Companies and LLPs must register on the NSWS website and add a “Startup Registration” form to begin the DPI accreditation process.
  • This step will formally recognize your startup under DPIIT, making it eligible for the benefits and support offered by the Startup India scheme.

• Step 4: Submit documents for Registration
• The following documents should be submitted in order to complete the registration process and to obtain DPIIT recognition for your Startup.
  • Incorporation/Registration Certificate of your startup.
  • Proof of funding, if any.
  • Authorization letter of the company’s authorized representative, LLP, or partnership firm.
  • Proof of concept, such as a website link, a pitch deck, or a video (applicable for validation/early traction/scaling stage startups).
  • Patent and trademark details, if any.
  • List of possible awards or recognitions.
  • PAN number (Permanent Account Number).

• Step 5: Self-certify Eligibility Requirements:
• Self-certify that your business meets the following requirements:
  • Your business is a LLP, or corporation partnerships.
  • Your business is established or registered in India for no more than five years.
  • Your company’s turnover is a maximum of INR 100 crore.
  • Your company is constantly updating or improving existing systems.
  • Your business is based on a new idea without breaking up or rebuilding an existing business.

• Step 6: Get your Accreditation Number
  • When you register, you will immediately receive your accreditation number. The registration or enrollment certificate will be issued after the authority has verified all the documents you have uploaded.

Note: Ensure accuracy while uploading data to avoid discrepancies as errors may result in a penalty of up to 50% of your paid-up capital or a minimum of INR 25,000. By meeting the eligibility and application criteria, your business can apply for the Startup India program and access various benefits offered by the government.

What are the benefits under Startup India program?

As mentioned above, Startup India offers many benefits to startups, which are detailed below:

• Patents, Trademarks and Design Registrations
  • If your startup needs a patent for its innovation or a trademark for its operations, you can easily approach any of the facilitators on the government list. In doing so, you will only have to bear the legal costs, allowing you to benefit from an 80% reduction in costs.
• Financing
  • Accessing financing is a significant challenge for many startups due to factors such as lack of experience, security or existing cash flow, which can deter investors’ potential due to the high risk nature of startups.
  • To solve this problem, the government has set up a fund with an initial capital of INR 2,500 crore and a total amount of INR 10,000 crore over 4 years (i.e. INR 2,500 crore per year).
  • The fund operates as a fund of funds, participating in capital contributions of SEBI registered venture capital funds, indirectly providing financial support to startups.
• Self-certification
  • Under labor and employment law, 4,444 startups can self-certify compliance with labor and environmental laws, thereby reducing compliance costs.
  • Self-certification minimizes regulatory burdens, allowing startups to focus on their core business. Within three to five years of founding, startups are allowed to self-certify compliance with six labor laws and three environmental laws.
• Exemptions from environment-related laws
  • Units belonging to 36 white listed industries, as published on the website of the Central Pollution Control Board, are exempted from licensing under three environment related laws for three years.
• Tax Exemption
  • Startups qualify for a three year income tax exemption. To benefit from this advantage, they must be certified by the Inter-Ministerial Board (IMB).

Concluison

In conclusion, the Startup India program stands as a robust initiative by the GOI to foster innovation and entrepreneurship, providing a nurturing environment for startups to thrive. By simplifying the registration process and offering benefits, including tax exemptions, access to funding, and intellectual property support, the program plays a pivotal role in catalyzing the growth of the startup in India. One who want to register a startup should follow the guidelines as per the Startup India Registration requirements. Embracing Startup India not only empowers aspiring entrepreneurs but also contributes significantly to economic development, job creation, and the realization of innovative solutions to societal challenges.

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