Lately, there have been many plans and schemes that the Indian Government has introduced to promote startups and businesses. In recent times, the Government of India has launched a flagship initiative in January 2016 known as Startup India. A DIPP registration is very important and beneficial for every startup enterprise. The government had taken this initiative to boost and promote innovation and business startups in India, with a vision to change the country’s people from job seekers to creators of jobs and owners of enterprises. It will in turn help boost the economic growth and help create more job opportunities for the people.
What is the DIPP?
DIPP or the Department of Industrial Policy and Promotion operates under the Ministry of Commerce and Industry of The Government of India. Set up in 1995, the function of this department is to formulate and implement all the measures for the promotion and development of the industrial sector. The department also takes initiatives to protect intellectual rights.
Who is Eligible for DIPP Registration?
Several startup companies seek the DIPP registration for its many benefits, but you also have to be eligible for the same. The requirements for eligibility are:
- The company must be a private limited firm or a partnership
- Owners or partners applying should be above 18 years of age
- The company should complete at least 7 years since inception
- The enterprise should not be a result of a reconstructed company or the result of the splitting of a company.
- The annual turnover of the company should not go over 25 crores
- The product must be innovative and unique and the idea of the product should not be copied from somewhere else.
What are the Documents Required to Get Your DIPP Registration?
- Certificate of the company’s incorporation
- Pan card of the owner or partners
- In the case of a Partnership firm, MOA or AOA of the Partnership deed
- A list of the directors or partners along with their email addresses, photograph, and links to their social profiles
- If the enterprise has registered for IPR or is in the process of registration, then such information should be provided.
- If the owners have raised funds from investors then information regarding the funding should be given
- If the company has received awards, accolades, or possesses any recommendation letter then such information should be provided.
All of the documents should be available in pdf form because you have to upload them.
How to get the DIPP Registration of your Startup?
You can follow the given steps to apply for your Startup registration under DIPP:
- Incorporation of your Company
You must follow the procedures required for incorporating your company as a Limited Liability Partnership or as a Private Limited Firm. Keep the documents handy for the same, like the incorporation certificate and pan cards of the owners, among others.
- Register your Business under the Startup India Scheme
Follow a quick and easy process to register your company under the Startup India scheme initiated by the government. It is really a hassle-free process and can be done online. All you need to do is upload a form with all the required documents on the Startup India website.
- Organize your Required Documents and Self-certify them
You must keep all your important documents and papers (as mentioned in the earlier list) organized and handy to be uploaded on the website. Do not forget to self-certify the documents before uploading.
- Decide Whether you want Tax Benefits
You will be given the option to choose whether you would like to sign up for the tax benefits that this scheme ensures. But for that, you will have to get approval, that too from the inter-ministry board. The decision of approval of the application lies solely on the ministry. Once your application is approved, your company is eligible for registration along with tax benefits. Once your business is registered under the DIPP, you can enjoy the IPR-related tax benefits without any special license. But you must not forget to select the “With Tax Benefits” option while applying for registration.
- Getting the DIPP recognition number
After your approval from the ministry, you are ready to apply for the recognition of your company. On applying, you will be given a unique recognition number. Once your documents are examined, a certificate of recognition will also be issued. Always be extremely careful while uploading your documents. If you are found to have uploaded forged documents, or if you miss an important document while uploading, then you will have to pay a fine of 50% of the capital paid, with a minimum fee of Rs. 25000.
What Qualities must a Startup have to get the Registration done?
- The scheme does not cover E-commerce businesses. So that’s a bummer for E-commerce startups.
- The product or service must be absolutely unique and innovative with nothing at par with it in the market.
- The focus of the startup should be to solve an existing problem and help make the lives of people more comfortable.
- The business should be a Limited Liability Partnership or Private Limited Firm and must be incorporated on or after 1st April 2016.
- The company should have a working business model during the time of application.
Which Recommendation Letters Help to get Tax benefits?
When you are aiming for tax benefits, along with the approval of the ministry, the following recommendation letters will be beneficial:
- If a patent is filed and approved by the company under any patent journal that might be available online or offline
- From incubators that are already established in post-graduate colleges in the country.
- Getting a letter of support from any startup company funded by the central or state government in India, or any government-funded incubator.
- A letter of funding, and must not be short of 20% of the equity of the incubator or angel fund.
The Indian Government has extended a lot of help to startups in recent times and has given them many opportunities to grow and make it big in the market. This in turn has helped generate more employment and will boost the economy in the long run. Hope this article on DIPP registration will be of great help to entrepreneurs and businessmen.