New Delhi. There is good news for the country’s young entrepreneurs and entrepreneurs running startups. The Income Tax Department said on Friday that startups recognized by DPIIT are eligible for various tax exemptions.
The department also said that investments made in such companies will also get these benefits and are not subject to investigation. However, investments made in startups that do not meet the necessary conditions can be investigated based on the department’s risk management strategy. The Income Tax Department gave this information on the social media platform ‘X’ while responding to a tweet.
The Income Tax Department posted, “Recognised startups that fulfil the conditions prescribed in the notification of DPIIT (Department for Promotion of Industry and Internal Trade) dated February 19, 2019 and file a declaration in Form-2 are eligible for various tax exemptions and deductions under the Income Tax Act, 1961.”
It said that benefits will also be available on investments made in companies that are not under investigation. On February 19, 2019, the government relaxed the definition of startups and allowed them to avail full ‘angel’ tax exemption on investments up to Rs 25 crore.
what are startups
In the business world, “startup” means an organization that is doing business with new and innovative ideas. The main objective of a startup is to find a solution to a problem and present it in the form of a business. Many online platforms including Amazon, Flipkart, Zomato and Swiggy started as startups.
In recent years, many Indian startups have received huge business funding from abroad. Earlier, the government had also abolished the angel tax imposed on startups.
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