Which Type of Support Provides for a Startup Pvt. Ltd. Company?
November 2, 2018
As per the Definition of Start-up by Department of Industrial Policy & Promotion, Startup means an entity, incorporated or registered in India :
- Not prior to seven years, however for Biotechnology Startups not prior to ten years,
- With annual turnover not exceeding INR 25 crore in any preceding financial year, and
- Working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation
Provided that, such entity is not formed by splitting up or reconstruction of a business already in existence. Provided also that an entity shall cease to be a Startup if its turnover for the previous financial years has exceeded INR 25 crore or it has completed 7 years and for biotechnology startups 10 years from the date of incorporation/ registration. Provided further that, a Startup shall be eligible for tax benefits only after it has obtained certification from the Inter-Ministerial Board, setup for such purpose.
Thus the following criteria is to br matched for being eligible as a start-up:
- Up to 7 years and for biotechnology startups up to 10 years from its date of incorporation / registration
- Incorporated as either a Private Limited Company or a Registered Partnership Firm or a Limited Liability Partnership
- Turnover for any fiscal year has not exceeded INR 25 crore
- Entity should not have been formed by splitting up or reconstruction a business already in existence
As far as support is concerned, the support with respect to working towards innovation, development or improvement of products or processes or services, or a scalable business model with a high potential of employment generation or wealth creation shall form as a part of consideration with respect to a Private Limited looking forward to recognize itself as a start-up entity.
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