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India’ s rapidly growing economy has created an environment conducive to growth of new business ventures. Starting a business requires not only sufficient funding and detailed planning but also the knowledge of related rules and regulations. This makes it compulsory for any new businessman to hire the services of a startup law firm in India before moving ahead with his plans.

Startup Law India

To be recognised as a StartUp in India and avail all the benefits:

  • Considering the long gestation period by Startups to establish, an entity shall be considered as a “Startup” up to 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 ten years from the date of incorporation/ registration.
  • Incorporated as either a Private Limited Company or a Registered Partnership Firm or a Limited Liability Partnership
  • Turnover for any fiscal year has not exceeded INR 25 crore
  • Entity should not have been formed by splitting up or reconstruction a business already in existence
  • Working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation

What do you need to set up a startup in India:

  • Startup lawyer in India – In most countries, hiring a good lawyer is a wise choice – in India it is considered imperative. Sound startup legal advice is essential to guide an entrepreneur through the many processes and compliances needed for any set up to prosper without any hindrances and ensure that all benefits are availed by the novice company.
  • Structuring – The first thing to starting any business is to recognize the nature and type of the business as per law. Founders will need to incorporate the business as a specific business type – sole proprietorship, private limited, public limited, partnership, limited liability partnership, etc. It is very essential to have this clarity at the very beginning as this is integral to the business, both short term and long term.
  • Incorporation / Startup Registration in India – Depending on the choice of structure, the startup law firm hired by you will require to register your entity. For such purpose the requirements are:
    • Suitable Name
    • Paid up capital
    • A minimum number Directors and members
    • DIN (Director Identification Number) and DSC (Digital Signature Certificate)
    • PAN (Permanent Account Number) and TAN (Tax Deduction and Collection Account Number)
    • Appropriate documentation such as Founders Agreement/Shareholders Agreement
    • Duly filled forms to be filled and filed with appropriate government Authority

Basic documentation that a Startup Lawyer in India will assist you with:

For any business to function both smoothly and safely, it is extremely important to have a strong base and not cut corners for short term growth. Some of basics for an entity should be to:

Structuring and Incorporation – The correct advice and guidance is essential at this stage, whether it is identifying which type of entity is the best fit or drafting documentation to raise funds and getting investments which will look out for your best interest for the future.

Licenses and Permits – Ensure that all licenses and permits to function have been procured.

Employment / Labour – Template of the employment agreements which can be executed with the employees and at some stage to have an employment manual that enumerates the rules and regulations that govern the employees. In our country, It is mandatory to inform a worker about his/her rights prior to the appointment. There are a number of startup legal services in India which can help in drafting employee contracts and code of conduct.

Confidentiality – To keep your business safe execution of NDA’s/Confidentiality Agreement is a must to be executed with the vendors;

Good and experienced Professional Guidance – Ignoring the need for legal and financial advice from the time of commencement is the Achilles heel of most startups. Good startup legal advice and assistance on all registrations and documentation that may be required at the time of incorporation of Company and post incorporation (such as Director identification number, PAN Number, Digital Signature, TAN registration, Name Approval of the company, MOA and AOA drafting etc.) is most crucial when setting up a business in India. This will prove most beneficial when looking for funding and investor options.

IP Protection – Ensure trademark registration and the protection from any infringement of your intellectual property rights.

Taxes – Proper registration as per law and GST registration provides start ups in India the perfect impetus needed for uninterrupted and cost effective setting up a business in India;

Startup Registration in India

Under the Startup India Action Plan, startups that meet the definition as prescribed under the G.S.R. notification 501 (E), are eligible to apply for recognition under the program. The Startups have to provide support documents, at the time of application.

No letter of recommendation from an incubator/industry association shall be required for either recognition or tax benefits

Start-up registration with Department of Industrial Policy and Promotion (DIPP) provides you with all government benefits such as tax saving, etc.

Do not hesitate in approaching one of the most reputed startup law firms in India Ahlawat & Associates for assistance on any issue regarding such matters.