Mumbai: Union Minister of Commerce & Industry, Mr. Suresh Prabhu brings breather for several startups that have received funds from Angel Investors or looking for funds. Government of India, recently announced the decision of easing the rules for startup by announcing a string of exemptions which included the contentious and much debated issue of Angel Tax. It was a much debated and was a long demanding step. Additionally, the widened definition of startups will also create business environment and will inspire new entrepreneurs to establish startups.
Consideration of an entity as startup upto 10 years from the date of incorporation / registration instead of existing 7 years & relief in turnover from 25 crore to 100 crore will help businesses to establish.
Simplification of the process for starups to get exemption on investment under section 56(2)(viib) of Income Tax Act, 1961 will help P2P lending industry which wasn’t so attractive for VCs & Angle investors due to low volume & higher operational cost. NBFC-P2P lending industry welcomes the announcement.
“The notification eliminates a major obstacle and clarification would help several startups in avoiding potentially significant tax challenges faced by startup and will allow them to focus on their core activities. However I would request Govt. of India to relook the section 68 of Income Tax, that will broaden the reforms,” said Mr. Rajiv M Ranjan, Founder & CMD PaisaDukan.
The Govt. of India has widened the definition of startups based on their incorporation date. Now an entity shall be considered as startup upto 10 years from the date of incorporation / registration instead of existing 7 years, relief in turnover from 25 crore to 100 crore and exemption on shares received up to an aggregate limit of Rs. 25 crore.
Founded by Rajiv Ranjan, PaisaDukan.com is a leading Peer to Peer money lending platform, it is a solely owned marketplace of BigWin Infotech, has come into existence as a matchmaker of the FinTech industry. PaisaDukan.com provides a highly secured customer experience with their completely transparent, hassle free and user friendly digital platform for all the borrowing and investing needs. The brand announced its entry in July 2018 in the NBFC-P2P lending category as the first new entrant to receive Certificate of Registration (CoR) from the Reserve Bank of India (RBI).