Before we dive into the eligibility criteria and the process to obtain tax exemption, it is important to understand what a startup is. According to the Department for Promotion of Industry and Internal Trade (DPIIT), a startup is an entity that has been incorporated not more than ten years ago and is working towards innovation, development, deployment, or commercialization of new products, processes or services driven by technology or intellectual property.
To avail of the tax benefit under Section 80IAC, the startup needs to obtain tax exemption every year. The approval for tax exemption is discretionary and based on the concept, its innovativeness, and scalability. The potential of growth and employment generation is one of the major criteria, hence you should include these aspects in your pitch deck and video.
The pitch deck and video are an essential part of the process to obtain tax exemption under Section 80IAC. The pitch deck should include details about the startup, the product or service, the market, the competition, and the potential for growth and employment generation. The video should provide a brief overview of the startup, the product or service, and the team.
The approval for tax exemption is subject to the satisfaction of the Income Tax Department. The department will evaluate the startup’s application, documents, and pitch deck and video and decide whether to grant tax exemption or not.
Tax exemption under Section 80IAC is a significant benefit for startups in India, as it can help them reduce their tax liability and reinvest the savings into their business. However, it is important to note that the approval for tax exemption is discretionary and based on the evaluation of the startup’s concept, innovativeness, scalability, and potential for growth and employment generation. Therefore, it is crucial for startups to put together a compelling pitch deck and video that highlights their strengths and potential.