The government has introduced minor changes to the startup definition, saying a business not older than seven years will now qualify for benefits under the Startup India Action Plan. So far, only companies up to five years from the date of incorporation were eligible for concessions under the plan announced last year.
As per the new definition, an entity shall be considered as a startup if its turnover is less than Rs 25 crore – which remains unchanged – and has not completed seven years from the date of its incorporation/registration. However, in the case of startups in the biotechnology sector, the period shall be up to 10 years.
To obtain tax benefits, it said, a startup should obtain a certificate of an eligible business from an inter-ministerial board of certification as constituted by the Department of Industrial Policy and Promotion.