Startups are booming in India. A startup is a small pool of innovation and efficiency. They are owned by a single founder or many founders ready to scale their business to greater heights. It is an entrepreneurial venture in its early stages of operations created to solve real-life problems or upgrade products/services available in the market. This article provides how to register a startup in India and the documents required for it.
Startup registration eligibility
Anyone above 18 years having an innovative idea or idea to improve an existing product/service can register a startup in India. Even NRIs and foreigners can register a startup in India along with an Indian entrepreneur.
How to register a startup in India?
Entrepreneurs can register a startup as a One Person Company (OPC), private limited company, partnership firm or Limited Liability Partnership (LLP).
One Person Company (OPC): OPC is a company registered under the Companies Act, 2013. It is owned and promoted by only one person. A single founder looks after the company. However, it can have up to 15 directors. It is ideal for sole owners who want to run a business with limited liability.
Private Limited Company (Pvt. Ltd.): A private limited company is registered under the Companies Act, 2013. It is privately owned and is separate from its founders. It can have up to 200 members and 15 directors. At least two members and directors are required to establish a private limited company. It is ideal for businesses with high annual turnover.
Partnership Firm: A partnership firm is a firm registered under the Indian Partnership Act, 1932. A minimum of two partners is required to register it, and they share the profits and losses of the firm business. However, they have unlimited liability. It is ideal for small businesses.
Limited Liability Partnership (LLP):A LLP is registered under the Limited Liability Partnership Act, 2008. It is formed through a partnership between a minimum of two partners where their liabilities are limited. An LLP is a partnership structure having the features of a company. It is ideal for businesses looking for limited liability and funding options.
How to register a startup company in India?
OPC or a private limited company can be registered through the SPICe+ form introduced by the Ministry of Corporate Affairs (MCA). The company registration process is online, and founders must fill out the SPICe+ form on theMCA portal. Below is the process of company registration in India:
- The founding members and directors of the company must obtain a Digital Signature Certificate (DSC).
- The directors of the proposed company must get a Director Identification Number (DIN).
- The company should apply for name reservation in Part-A of the SPICe+ form.
- The company must fill in the other details in Part-B of the SPICe+ form.
- The Registrar of Companies (ROC) will issue the Certificate of Incorporation along with the PAN number after examining the SPICe+ application and documents.
How to register a company in the Startup India scheme?
The Government of India has introduced the Startup India scheme to encourage startups in India. Startups registered under the Startup India scheme get various benefits, such as ease of compliance, tax exemptions and various funding options.
Startups must be registered as an OPC, limited liability company, LLP or partnership firm before registering under the Startup India scheme. Startups in existence for more than ten years cannot register under this scheme. Similarly, startups having an annual turnover of more than ₹100 crore cannot register under this scheme. The process to register with the Startup India scheme are as follows:
- Visit theStartup India scheme website.
- Click on the ‘Register’ button.
- Create a Startup India profile after entering the required details.
- Log in to the Startup India scheme website and click the ‘Apply for DPIIT Recognition’ option under the ‘Recognition’ tab.
- Select the ‘Apply as a Company or LLP’ or ‘Apply as Partnership Firm’ option.
- Fill in the details on the ‘Startup Recognition Form’ and click the ‘Submit’ button.
Click here to learn more about the Startup India scheme registration.
List of documents required for startup registration in India
- PAN card of all directors and members (partners in case of LLP or partnership firm).
- ID and address proof of all directors and members (partners in case of LLP or partnership firm).
- Proof of registered office address of the startup (Registered address’ utility bill or rental agreement).
- NOC from the land owner where the startup is situated on a rental property.
- Partnership deed or Articles of Association and Memorandum of Association.
Startup company registration cost
The startup registration cost depends on the legal entity and share capital. The startup company registration cost is as follows:
- OPC Registration service cost – ₹22,418*
- LLP Registration service cost – ₹23,103*
- Private Limited Company Registration service cost – ₹22,968*
- Partnership Firm Registration cost - ₹11,798*
*Prices shown above can vary.
Startup registration benefits
- Startups are exempted from paying income tax for three years provided they get an Inter-Ministerial Board (IMB) certification.
- Startups can apply for government tenders since they are exempt from the ‘prior experience/turnover’ criteria.
- Startups registered under the Startup India scheme can self-certify compliance with nine labour and three environment laws.
- Startups recognised by DPIIT can list as sellers on the Government e-Marketplace, the Government of India’s largest e-procurement portal.
- Startups can raise money easily from investors, Venture Capitalists (VCs) and angel investors.
- Startups can process patents and other intellectual property rights at a considerably lower fee.
Frequently Asked Questions
How to get a startup registration certificate?
Startups can get a startup registration certificate by applying under the Startup India scheme. Startups can apply for the Startup India scheme by registering on the Startup India scheme website and applying for DPIIT recognition.
How much does it cost to register a startup in India?
It usually costs around ₹2,000 to ₹30,000 to register a startup in India. The cost varies depending on the legal structure and the investment of the startup.
How can I start a startup company in India?
You can start a company in India by logging into the MCA website and submitting the SPICe+ form along with the required documents.
Can I register a startup in India?
Yes. You can register a startup in India by establishing it as a public limited company, LLP, OPC or partnership firm under the respective acts. After establishing the startup, it should apply under the Startup India scheme to get DPIIT recognition and get various startup benefits provided by the government.
How do I register my company as a startup?
You can start a company in India by logging into the MCA website and submitting the SPICe+ form along with the required documents. After obtaining the Certificate of Registration from the Registrar of Companies, the startup should apply under the Startup India scheme by registering on the Startup India website and get DPIIT recognition.
How many startups are there in India?
In April 2023, the Union Minister for Science and Technology, Jitendra Singh, stated that the startups have grown from around 350 in 2014 to over 90,000 in 2023, with more than 100 unicorns in India.
What is the turnover limit for a startup?
The annual turnover limit for a startup is below ₹100 crore in India.
What are the tax benefits for startups?
A startup has tax exemption under Section 80-IAC of the Income Tax Act, 1961, when it is registered under the Startup India scheme and has obtained the DPIIT recognition. It can apply for exemption from angel tax under Section 56 of the Income Tax Act. It can also avail of a tax holiday for three consecutive years.
