How to Register a Startup in India ?

 India's unicorns are currently worth more than $170 billion, and counting. The startups from India are attracting great investments because they are the breeding ground of new-age innovations focused on empowering the people in emerging markets with the right digital solutions, impacting the lives of millions. The government’s priority is to give as many youth as possible the opportunity for innovation.

The government has set up various schemes and institutional mechanisms such as ‘Start-Up India, Stand-India’ type of programmes and ‘Make in India’ which ensure the hand-holding of young innovators.

In India to register a start up following conditions must be fulfilled

• The firm has to be a private limited company or a limited liability partnership (LLP)
• The company remains a startup for the first 7 years (Earlier 10year)
• The company remains a startup if the turnover per year does not cross the Rs 100 crore mark in any of the 10 years. Once the company crosses the mark, it no longer remains eligible to be called a startup.
• The firm should have approval from the Department of Industrial Policy and Promotion (DIPP)
• The firm should be funded by an Incubation Fund, an Angel Fund or a Private Equity Fund
• A patron guarantee from the Indian Patent and Trademark office is necessary
• You must have a recommendation letter by an incubation
• The firm must come up with innovative ideas and schemes
• All the details regarding the funding must be registered with SEBI (Securities and Exchange Board of India)

Procedure for registering a startup in India

For this first have to incorporate your business as a Private Limited Company or a Limited Liability Partnership or a Partnership firm and you need to register your firm or company as a startup in the Startup India scheme of the government. You have to fill in all the details and upload a certain number of documents as well. 

On application of this registration, you will get a recognition number with immediate effect. You get the certificate of registration or incorporation only after the authority goes through all your uploaded documents. 

You need to be careful while uploading the data, as any discrepancy in it can cause you a huge fine of up to 50% of your paid-up capital or Rs 25,000 at the very least. 

In India, startups do not have to pay income tax for the first three years but to avail such benefits, the company must be certified by the Inter-Ministerial Board (IMB). This is where companies registered with DIPP get relaxation as the registration is enough to get the benefits.