Get the Startup India recognition for your startup. Now is the time.

With the BJP government back to the helm, one can only expect the Startup India program to further get more momentum. Quite a few things have already been rolled out by the government under the Startup India program. As many as 19,000 startups have received their DIPP numbers (Startup India recognition) as per the government website.

While the levels of expectation were quite high among startups earlier in the year, the Angel Tax fiasco created some jitters amongst startups. Eventually after a few unpopular attempts the government finally cleared the confusion around Angel Tax exemption and raised the limits. So is it all OK now you may ask. That is a million dollar question. At least what we can decipher is that the government is serious about startups and believes in removing hurdles from their way.

Does it still make sense to get your startup Startup India recognised and get your DPIIT number (previously known as DIPP number)? We think it does for more than one reason.

1. As much as 541 DPITT registered startups were exempted from Angel Tax as on 28th May 2019. Being DPIIT recognised in an eligibility criteria for a startup to qualify for this exemption. Angel investors also would be interested only in DPITT recognised startups for the same reason
2. Getting FDI in the form of Convertible Notes for your startup is easier if your startup has a DPIIT number. We were able to validate this based on personal experience by one of GoFloaters’ member startups.
3. The government also provides Income Tax exception for a recognised startup. As on date only around 90 startups have been able to claim this benefit. It is to be seen if the government will relax the norms here to benefit more startups.
4. Many banks that provide startup specific banking services also provide preferential terms if you startups is DPIIT recognised
5. There are other benefits like getting approvals, easier process for IPR and easier process for winding down the company as mentioned in the Startup India website.

Clearly it does make sense to get DPIIT recognition for your startup. Why wait when the process is straight forward and when no cost is involved?

Originally published at https://medium.com on May 31, 2019.