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Startup Registration in India – How to Register a Startup Online?
Whether you're a budding entrepreneur with a groundbreaking idea, a student exploring new opportunities, or a professional trying their luck for the nth time, starting a new business in India is a challenging but rewarding adventure.
Unlike traditional businesses, startups often begin with a small team, minimal resources, and a focus on scaling rapidly. India's startup ecosystem is one of the fastest-growing in the world. It is fueled by a vibrant mix of innovation, entrepreneurship, and government support. With over 100 unicorns, India ranks as one of the top global hubs for startups.
It's not just a vibrant ecosystem- the Indian Government offers a tonne of initiatives like Startup India, Make in India, etc., designed to benefit and support the ease of doing business, but these advantages are only accessible to registered startups.
A registered startup can enter into contracts, own property, and be eligible for government schemes and incentives. It also enhances credibility with customers, investors, and partners. So, let us explore the process and key aspects of startup registration in India.
About Startup India Scheme
The Startup India initiative is a program launched by the Government of India in 2016 to promote and support entrepreneurship, innovation, and the growth of startups in the country.
The scheme aims to build a strong ecosystem for nurturing innovation and entrepreneurship, making India a global hub for startups. Startup India provides a comprehensive platform that offers free services, learning modules, information on government policies, a creative idea bank, and active programs.
DPIIT Registration for Startup
The Department for Promotion of Industry and Internal Trade (DPIIT) registration is a crucial step for startups looking to benefit from the various incentives and schemes offered by the Indian government under the Startup India initiative.
DPIIT, which operates under the Ministry of Commerce and Industry, grants official recognition to startups, enabling them to access a host of benefits designed to support their growth and development.
Eligibility Criteria for Start-up Registration in India
To qualify as a Startup in India, companies must obtain recognition from the Department for Promotion of Industry and Internal Trade (DPIIT) and meet specific predefined eligibility conditions. Below is a detailed breakdown of the eligibility requirements for Startup India recognition.
Incorporation Type
Your business should be registered as one of the following:
a. Private Limited Company
b. Limited Liability Partnership (LLP)
c. Registered Partnership Firm
Startups incorporated outside India are ineligible to receive Startup India recognition.Age of Business
Your startup should be relatively new and have been incorporated or registered within 10 years from the date of application.
Annual Turnover
Your startup should have an annual turnover of less than Rs. 100 Crores in any of the previous financial years.
Innovation or Scalability
The startup should work towards innovation, development, deployment, or commercialization of new products, processes, or services driven by technology or intellectual property.
Alternatively, it should aim for a scalable business model with high growth potential. Non-profit organizations are ineligible to apply for Startup India Recognition.
Entity type
Entities formed as a result of demergers, mergers, or those operating as established subsidiaries are not eligible to apply for Startup India Recognition.
Startup Registration Process in India
Step 1: Register your Business
The first and crucial step in the process of registering your startup is to formally incorporate your business tailored to your specific needs and preferences.
You can register your business as following types:
Please note: It's essential to understand that DPIIT recognition does not apply to all types of incorporated entities. To know more about the eligible entity type, click here.
Here is a brief outline of the business registration process:
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- Obtain a Digital Signature Certificate (DSC)Acquire DSCs to securely authenticate electronic documents and transactions. This ensures the integrity and security of online submissions throughout the registration process.
- Secure Company Name ApprovalSelect a suitable and unique company name, then submit it to the MCA for approval. Ensure the chosen name complies with MCA guidelines and is not already in use.
You can perform a quick company name search on our website to avoid any potential issues before proceeding. - Apply for Business Registration
Once your chosen name is approved, begin the incorporation process. This entails providing comprehensive information about your business's structure, registered office, directors, shareholders, and other crucial details.
For Private Limited and One Person Company (OPC) registrations, utilize SPICe+, while FiLLiP is for LLP registration. - Obtain a Certificate of Incorporation
After thoroughly reviewing your application, the MCA will issue you a Certificate of Incorporation (COI). The COI signifies the successful establishment of your startup, granting it a distinct legal identity.
The above steps can differ for various company types, and additional compliances might apply depending on the nature of the business and industry.
* Effective 15th July, 2024, DSC charges have increased by ₹ 1,000 per DSC, by the Government. This will be chargeable over and above the given prices.
Step 2: Register with Startup India
The next step is to create an account on the Startup India website. This process is 100% online and can be done through the following steps:
- Visit the official website of “Startup India”.
- Create an account by clicking “Register” if you don't have one. You can also log in if you already have an account.
- Fill out the online application form with accurate and detailed information about your startup, like your name, the startup stage, etc.
- Once submitted, your profile will be created.
After creating your profile on the Startup India website, you can access a wide range of opportunities and resources available on the portal.
Step 3: Register with DPIIT
The last step of Registration includes getting the Department for Promotion of Industry and Internal Trade (DPIIT) Recognition.
To apply for DPIIT Recognition for your startup, follow these steps:
- Visit the Startup India website and log in using your registered profile credentials.
- After logging in, go to the 'Recognition' section on the website.
- Under the 'Recognition' tab, you should find the option to 'Apply for DPIIT Recognition.' Click on this option to initiate the application process.
- On the next page, you will typically encounter two options:
a. 'Apply as Company or LLP'
b. 'Apply as Partnership Firm'
Choose the option that corresponds to the legal structure of your startup. - Fill out the application form with accurate and detailed information about your startup, including its business model, founders, and other relevant details.
- Upload the required documents as mentioned above.
- As part of the application, self-certify that your startup meets the DPIIT's eligibility criteria and is not involved in any activities that disqualify it from recognition.
- Submit your application through the online portal.
Once recognised by the DPIIT, your startup can leverage these benefits to accelerate growth, access funding opportunities, and contribute to India's growing entrepreneurial ecosystem.
Step 4: Obtain Startup India Recognition Number
Upon submitting your application for Startup India registration, you will be provided with an Acknowledgment Receipt Number (ARN) to track the status of your certificate.
DPIIT will examine your application and documents. Once verified, it will issue a Certificate of Recognition (DIPP Certificate), which includes a unique Recognition number and the date of recognition that can be used during different stages of your business.
With your Certificate of Recognition, you can access various benefits and support offered under the Startup India initiative, including tax exemptions, funding opportunities, and more.
Documents Required for Registration
Documents of the Directors/ Shareholders/ Partners
- Identity Proof: PAN card/Aadhar card/ Driving license/ Passport
- Address Proof: Utility Bills like electricity bills, water bills, etc.
- DIN/DPIN and DSC of all the directors/ partners
Documents of the Startup
- Incorporation/ Registration Certificate for your startup.
For detailed information on documents required specific to different types of company registration, check out the respective pages along with the steps. - Authorization letter of the authorized representative of the company, LLP, or partnership firm
- LLP Agreement/Partnership Deed in Case of a Firm
- Memorandum of Association (MoA) and Articles of Association (AoA) in case of a company
- PAN of the Business
- Based on the startup stage, additional documents like Pitch deck, Website/App link, Proof of funding, List of awards, Patent and Trademark details, etc.
Startup Registration Fees in India
While the registration process under Startup India and DPIIT is generally straightforward and free of charge, incorporation with the MCA can incur additional costs.
These costs can include fees related to
- Name Reservation
- Director Identification Number (DIN) application
- Incorporation fees based on authorized capital
- Stamp duty
- PAN/TAN application fees and GST registration fees, if applicable.
This cost depends on several factors, including the type of business entity, professional fees, and other specific requirements.
Benefits of Startup Recognition under DPIIT
Tax Benefits
- Income Tax Exemption
You can obtain approval for tax exemption under section 80 IAC of the Income Tax Act. This offers the startup a tax holiday for three consecutive financial years during its initial ten years of incorporation.
Eligibility Criteria for 80IAC Exemption:
1. The entity must be officially recognized as a Startup, typically through the Startup India program or relevant government authorities.
2. Only Private Limited Companies or Limited Liability Partnerships (LLPs) are eligible for Tax exemption under Section 80IAC.
3. The Startup should have been incorporated after April 1, 2016. This means it must have been established on or after this date to be eligible for the specified Tax exemption. - Capital Gains Tax Exemption
Capital gains from the sale of specified assets are exempted under Section 56 of the Income Tax Act if the proceeds are invested in eligible startups. This is also known as Angel Tax Exemption.
Eligibility Criteria for Section 56 Exemption:
1. The entity must have obtained recognition as a Startup by the Department for Promotion of Industry and Internal Trade (DPIIT).
2. The total sum of paid-up share capital and share premium of the Startup, considering any proposed share issuance, must not surpass INR 25 Crore.
Intellectual Property Protection
The recognition includes the following key provisions to support startups in the patent and intellectual property (IP) process:
- A panel of "facilitators" regulated by the Controller General of Patents, Designs, and Trademarks (CGPDTM) will offer guidance on IP matters and international IP protection.
- The Central Government will cover facilitators' fees for all patents, trademarks, or designs filed by startups. You only need to pay the statutory fees.
- There is an 80% rebate on patent filing fees compared to other companies, reducing costs during the initial years.
The progress in patents and trademarks can be accessed through a fast-tracking application system.
For the most current information on the patent or trademark application process, as well as the necessary documents, you should directly contact a Facilitator. The choice of Facilitator may depend on your specific industry sector and the jurisdiction in which you intend to file your application.
Self- Certification
You can self-certify compliance with 6 Labor and 3 Environmental Laws through a simplified online process.
For Labor Laws, inspections will only be conducted for 5 years if a credible written complaint, approved by a higher-level officer, is received. Startups categorized as white (non-polluting industries) by the Central Pollution Control Board (CPCB) can also self-certify for environmental laws.
Here is a list of Labour Laws and Environment Laws eligible for self-certification:
- Labour Laws:
a. The Building and Other Constructions Workers’ (Regulation of Employment & Conditions of Service) Act, 1996
b. The Inter-State Migrant Workmen (Regulation of Employment & Conditions of Service) Act, 1979
c. The Payment of Gratuity Act, 1972
d. The Contract Labour (Regulation and Abolition) Act, 1970
e. The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952
f. The Employees’ State Insurance Act, 1948 - Environment Laws:
a. The Water (Prevention & Control of Pollution) Act, 1974
b. The Water (Prevention & Control of Pollution) Cess (Amendment) Act, 2003
c. The Air (Prevention & Control of Pollution) Act, 1981
Access to Funding
The Department for Promotion of Industry and Internal Trade (DPIIT) has established the Startup India Seed Fund Scheme (SISFS) with a budget of INR 945 Crore to offer financial support to startups through Incubators.
This can help you in various stages of your journey, including Proof of Concept, prototype development, product trials, market entry, and commercialization.
The seed fund can be disbursed as follows:
- A grant of up to Rs. 20 Lakhs to validate their Proof of Concept, develop prototypes, or conduct product trials. This grant is disbursed in installments based on milestones.
- Up to Rs. 50 Lakhs in investment for market entry, commercialization, or scaling up through convertible debentures or debt-linked instruments.
Numerous Central Government and State schemes provide early-stage funding opportunities. These include schemes like Credit Guarantee Scheme, NIDHI PRAYAS, NIDHI SSS, BIRAC's initiatives, and TIDE 2.0, among others.
Easy Winding up of Company
Under the Insolvency and Bankruptcy Code of 2016, startups with simple debt structures or those meeting specific income criteria can complete the insolvency process within 90 days of filing an application.
Once filed, an Insolvency Professional will be appointed to take control of the company, including asset liquidation, creditor repayment, and closing the business within 6 months while upholding the principle of limited liability.
This encourages entrepreneurs to freely experiment with fresh and innovative ideas without the burden of navigating intricate and time-consuming exit procedures.
Easy Public Procurement Norms
As a DPIIT Recognized Startup, you can list your products on the Government e-Marketplace (GeM) by registering as a Seller.
GeM is a prominent online procurement platform used by the Government to acquire products and services. This makes it easier to access a potential market for their products.
You can also avail exemption on the following during Government Tenders:
- Prior Experience/ Turnover
- Earnest Money Deposit (EMD) or Bid Security
Company Name Availability
Choosing the right name for your company can either set you up for success or hold you back. A strong, unique name sets you apart in a crowded market and communicates your vision to customers. Before finalising it, ensure that your name is unique, legally compliant, and aligns with your startup’s mission and values.
Check if your desired company name is available with our easy-to-use tool below.
Searching for a company name?
Check company name availability using our powerful name search tool.
Checklist for the Registration of a Startup
Time Taken to Register a Startup under DPIIT
The Certificate of Recognition from the Department for Promotion of Industry and Internal Trade (DPIIT) is typically issued promptly, within 2 working days of submitting your application.
However, the overall timeframe for officially registering your startup under DPIIT may extend to approximately 10-15 working days. This extended timeline accounts for the steps involved in the startup incorporation and registration process, including obtaining necessary documents, registering with the MCA, registering with Startup India, etc.
Things that Can Delay a Registration Process
- Incomplete or Incorrect Documentation: Providing incomplete, inaccurate, or mismatched documents can result in delays.
Please note- If, upon subsequent verification, it is discovered that the required document is either missing, incorrectly uploaded, or found to be forged, there are legal consequences.
In such cases, you may be subject to a penalty equal to 50% of your paid-up capital, with a minimum fine of Rs. 25,000. - Delay in Verification Process: Government agencies may need time to verify the information provided in your application.
- Delay in MCA registration step: Your registration with MCA can be delayed due to name approval issues, technical server errors, etc., which further affects the registration under DPIIT.
Several factors can cause delays in your startup registration process. It's advisable to consider these factors and monitor them closely to ensure a streamlined and seamless registration experience.
Choosing the Right Business Structure: Proprietorship vs Limited Liability Partnership (LLP) vs Company
Frequently Asked Questions
Is it mandatory to register with Startup India?
No, registration with Startup India is not mandatory. However, it is advisable to register if you tick all the eligibility boxes to access several benefits and support.
Can a sole proprietorship be considered a startup under Startup India?
No, sole proprietorships are not eligible for recognition under Startup India. Only private limited companies, LLPs, and partnership firms are eligible.
Do I need to register my startup with both the MCA and DPIIT?
Yes, the registration with the Ministry of Corporate Affairs (MCA) and DPIIT serves different purposes. MCA registration establishes your legal entity, while DPIIT recognition provides access to benefits and support from the Government.
How do you get a registration number for a startup?
Once verified, a Certificate of Recognition from DPIIT will be issued, containing a unique recognition number and the date of recognition, which can be used at various stages of your business.
This number officially recognizes a business as a startup under the government's Startup India program, granting it access to various benefits, such as tax exemptions, government funding schemes, simplified regulatory processes, and other incentives designed to support and accelerate its growth.
How can Razorpay Rize assist me with startup registration?
Razorpay Rize offers comprehensive, 100% online MCA registration for your startup, with the lowest professional fees and no hidden charges.
We provide seamless registration for Private Limited Company, One Person Company, and Limited Liability Partnership.
To explore our range of services, Click here.
Is it mandatory for a startup to get GST Registration?
GST registration is mandatory for startups if their annual turnover exceeds the prescribed threshold, which varies based on the type of business.
How do you get the Startup India Certificate?
To obtain the Startup India Certificate, follow these steps:
- Ensure eligibility
- Register on the Startup India Portal
- Apply for recognition
- Submit documents
- Receive the Certificate post-verification
Does the Startup India certificate have a validity period?
The Startup India Certificate becomes invalid if-
- A business entity has completed 10 years from the date of incorporation.
- The turnover for any previous financial year exceeds Rs. 100 Crores.
Can an existing entity/company register as a “Startup” on the Startup India Portal?
Yes, an existing entity or company can register as a “Startup” on the Startup India Portal, provided it isn’t older than 10 years and meets the eligibility criteria.
Can a non-resident be a part of the Startup India initiative?
Any entity with at least one registered office in India can register on the Startup India hub. Currently, location preferences are only available for Indian states.
How long does it take to register a startup under DPIIT?
DPIIT registration for a startup typically takes around 2-3 working days, provided all required documents and information are submitted correctly.
What are the tax benefits for startups?
Startups in India registered recognized by the DPIIT can enjoy several tax benefits to foster growth. Here are the key tax benefits for startups:
- Tax exemption on profits for any three consecutive financial years.
- Exemption from Angel Tax
- Capital Gains Exemption
- Carry Forward of Losses and Capital Gains
What is the turnover limit for a startup?
The turnover limit for a startup to be recognized under the DPIIT is ₹100 crore.
What is startup registration?
Startup registration is the process of getting your business officially recognized as a startup by the Indian government through the Startup India initiative.
Which type of registration is best for startup?
The best type of registration for a startup depends on the business goals, scale, and future plans. Here are the most common options:
- Private Limited Company: Best for Startups aiming to scale, attract investors, or raise external funding.
- Limited Liability Partnership (LLP): This is best for Professional services seeking a flexible structure with limited liability and lower compliance.
For most startups, a Private Limited Company is the best choice, especially for scalability, fundraising, and protection of personal assets.
Who is eligible for startup in India?
To be eligible for startup recognition in India under the Startup India initiative and DPIIT, a business must meet the following criteria:
- The startup must be registered as one of the following:
a. Private Limited Company (under the Companies Act, 2013)
b. Partnership Firm
c. Limited Liability Partnership (LLP) - The business should not be more than 10 years old from the date of incorporation or registration.
- The annual turnover of the startup should not exceed ₹100 crore in any financial year since its incorporation.
Who can register with startup India?
Any business meeting the eligibility criteria can register with Startup India and gain recognition under the DPIIT.
What are the benefits of signing up with startup India?
Here are the key benefits:
- 3-Year Tax Holiday
- Angel Tax Exemption
- Capital Gains Exemption
- Access to Government Funding
- Fast-Tracked Patent Applications
For how long is a company recognised as a startup?
A company is recognized as a startup in India for a period of up to 10 years from the date of its incorporation or registration, provided its turnover should not exceed ₹100 crore in any financial year during this period.
How much does it cost to register a startup with Razorpay Rize?
The cost of registering a company in India varies according to its type, number of stakeholders, capital, and size. Razorpay Rize offers company registration services for Private Limited Companies, LLPs, and OPCs, starting at just Rs. 1499!
What are the benefits of a startup scheme?
The Startup Scheme offers several key benefits:
- Tax Exemptions: 100% tax holiday for 3 years, angel tax exemption, and capital gains tax benefits.
- Funding Support: Access to government-backed venture capital and credit guarantees.
- Compliances: Self-certification for labor laws, no inspections for 3 years.
- IPR Benefits: Fast-tracked patent approvals and fee rebates.
- Public Procurement: Exemptions from EMD and eligibility criteria for government tenders.
- Networking: Access to mentors, incubators, and startup showcases.
- Simplified Exit: Quick winding-up process if needed.
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We just got incorporated yesterday.
Thanks to Rize team for all the Support.
It was a wonderful experience.
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@foxsellapp
#razorpayrize #rizeincorporation
#entrepreneur #tbsmagazine #rize #razorpay #feedback
We just got incorporated yesterday.
Thanks to Rize team for all the Support.
It was a wonderful experience.
CHEERS 🥂
#entrepreneur #tbsmagazine #rize #razorpay #feedback