Startup India Registration
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Startup India Registration
The Government of India, under the leadership of PM Narendra Modi, has started and promoted the Startup India initiative to develop the Indian economy, recognise and promote startups and attract talented entrepreneurs.
DPIIT Registration for Startups
Under the Startup India scheme, eligible companies can be recognised as Startups by the Department for Promotion of Industry and Internal Trade (DPIIT), which is part of the Ministry of Commerce and Industry, Government of India. When a startup obtains DPIIT recognition, it becomes eligible for a range of benefits outlined under the Startup India scheme.
Eligibility Criteria
Job Creation: The startup should either contribute to job creation or have the potential to do so in the future, aligning with the Startup India scheme’s objective to stimulate employment within the country.
DPIIT Recognition: The startup must acquire a startup India certificate from the Department for Promotion of Industry and Internal Trade (DPIIT).
Innovative Approach: The startup must aim to innovate, develop, deploy, or commercialise new products, processes, or services driven by technology or intellectual property.
Business Structure: The startup must be incorporated as a private limited company, a limited liability partnership (LLP), or a partnership firm.
Age of the Startup: The startup should be at most ten years from its incorporation. However, startups in the biotechnology sector are allowed up to 15 years.
Annual Revenue: The startup's yearly turnover must not exceed INR 100 crores in any fiscal year since its inception.
Innovative Approach: The startup must aim to innovate, develop, deploy, or commercialise new products, processes, or services driven by technology or intellectual property.
Documents Required
Incorporation/Registration Certificate of your startup
Proof of funding, if any
Authorisation letter of the authorised representative of the company, LLP or partnership firm
Proof of concept like pitch deck/website link/video (in case of a validation/ early traction/scaling stage startup)
Patent and trademark details, if any
List of awards or certificates of recognition, if any
PAN Number
Key Features of the Fund of Funds
The Fund of Funds shall be managed by the Small Industries Development Bank of India (SIDBI)
Life Insurance Corporation (LIC) shall be a co-investor in the Fund of Funds
The Fund of Funds shall contribute to a maximum of 50% of the SEBI registered Venture Funds (“daughter funds”). In order to be able to receive the contribution, the daughter fund should have already raised the balance 50%. The Fund of Funds shall have representatives on the board of the venture fund based on the contribution made.
The Fund shall ensure support to a broad mix of sectors such as manufacturing, agriculture, health, education, etc.
It’s very easy to register as a startup thanks to the various government initiatives. However, you can focus on your key area while we at ClearTax help you from start to finish right from incorporating your company to getting your startup recognition. Do visit our website to know more about startup services.
How to Register a Startup company in India ?
Here’s a step-by-step guide on how to register your startup with Startup India and obtaining Startup India Certificate:
Incorporate Your Business
Begin by incorporating your business. You can choose from several structures, such as a Private Limited Company, Partnership Firm, or Limited Liability Partnership (LLP). This involves submitting a registration application along with the necessary documents and fees to the appropriate authority.
Private Limited Company or LLP: File your registration application with the Registrar of Companies (ROC)
Partnership Firm: Submit your registration application to the Registrar of Firms.
For both types of registration, you will need to obtain a Startup Certificate of Incorporation or Partnership registration, confirming the legal formation of your business. The experts at IndiaFilings can help you register your company easily in India.
Register with Startup India
Once your business is incorporated, you can register it as a startup on the Startup India website. You'll need to fill out a form on the Startup India portal and upload certain documents, including details of your business structure and a brief about your products/services.
Obtain DPIIT Registration
Once your profile on the Startup India website is set up, the next essential step is to secure recognition from the Department for Promotion of Industry and Internal Trade (DPIIT). As mentioned earlier, DPIIT recognition grants startups numerous advantages.
To apply for DPIIT Recognition, sign in with your registered profile credentials on the Startup India website and navigate to the ‘Apply for DPIIT Recognition’ option located under the ‘Recognition’ tab. On the subsequent page, select either ‘Apply as Company or LLP’ or ‘Apply as Partnership Firm.’
If you choose ‘Apply for Company or LLP,’ you will be directed to the National Single Window System (NSWS) website. Here, companies and LLPs must register and add the ‘Registration as a Startup’ form to begin the DPIIT registration process.
Successfully completing this step will officially recognise your startup under DPIIT, enabling access to the comprehensive benefits and support provided by the Startup India initiative.
Obtain Your Startup India Recognition Number
Once you apply for registration, you will immediately receive a DPIIT recognition number. This serves as a preliminary acknowledgement of your application. The official Startup India Certificate of Registration will be issued after the relevant authority thoroughly reviews all your submitted documents. This Startup India certificate is your formal recognition under the Startup India initiative, confirming that your startup meets all the necessary compliance and eligibility criteria.
After receiving the DPIIT certificate, you can apply for various benefits offered under the Startup India scheme, such as tax exemptions (under the Income Tax Act), patent filing, and IPR services. IndiaFilings makes this process easier for your new business with reasonable startup India registration fees.
Startup accelerators support early-stage, growth-driven companies. These programmes usually have a timeframe in which individual companies spend anywhere between a few weeks and a few months working with a group of mentors who are educated and may also provide financial help.
Benefits Provided under the Start up India Scheme
Self-certification under Employment and Labour Laws
Startups can self-certify compliance under specific labour and environmental laws, reducing the compliance burden and associated costs. This allows startups to self-certify under six labour laws and three environmental laws for three to five years post-incorporation.
Tax Exemption
DPIIT-recognized startups are entitled to an income tax exemption for three consecutive financial years out of their first ten years since incorporation. Moreover, startups can apply for an exemption from angel tax under Section 56 of the Income Tax Act, which is particularly beneficial for early-stage startups receiving external equity investments at valuations exceeding their fair market value.
Environment-Related Acts Exemption
Startups in the thirty-six industries categorised as 'white' by the Central Pollution Control Board are exempt from certain environmental clearances under three specific acts for up to three years.
Streamlined Winding up
Startups can shut down their operations within 90 days from the date of making the application, providing a hassle-free exit strategy for businesses that need to cease operations.
Patents, Trademarks, and Design Registration
Startups that need to secure patents for innovations or trademarks for their business can access facilitators from a government-approved list. By engaging these facilitators, startups benefit from an 80% reduction in fees, covering only the statutory charges.
Funding Support
Many startups face challenges in accessing finance due to their lack of experience, absence of security, or insufficient cash flows, which often pose a high risk for potential investors. To mitigate this, the government has set up a fund with an initial corpus of Rs. 2,500 crore, aiming for a total of Rs. 10,000 crore over four years. This fund, functioning as a Fund of Funds, invests in the capital of SEBI-registered venture funds, thus providing indirect financial support to startups.
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FAQs
Startup incubators are typically institutions that help entrepreneurs by developing their business, especially in the initial stages. The incubation function is usually carried out by institutions that have experience in the business and the tech world.
Startup accelerators support early-stage, growth-driven companies. These programmes usually have a timeframe in which individual companies spend anywhere between a few weeks and a few months working with a group of mentors who are educated and may also provide financial help.