BUDGET 2017: WHAT'S IN STORE FOR START-UPS?

Bugdet 2017

BUDGET 2017: WHAT'S IN STORE FOR START-UPS?
Image Source - https://pixabay.com/photo-2112081/
The Budget 2017 has come up with few benefits to startups in India to promote more business, entrepreneurs and reduce the percentage of job seekers. These all changes and revisions are taking place because of the "Start-Up, Stand-Up" of our Hon'ble Prime Minister Narendra Modi.

Given the recent trend of “starting our own venture”, all the young and passionate entrepreneurs had high hopes from the Government for recognition and benefits to start-ups in the Union Budget, 17. This hope has surprisingly been satisfied by our Hon’ble Finance Minister Sh. Arun Jaitley to some extent, which will be helpful in ease of doing business in India.

These benefits will add wings to the budding entrepreneurs as promised by the Government of India in the "Start-up, Stand-up" campaign.                                                            

Needless to say, the star-up culture has tremendously changed the market scenario and impacted each and everyone’s life in person. You can buy any product you wish for while sitting at home or ask for any service you may need, discounted and cash-back offers etc.

To further strengthen the system and motivate people to think out of the box, there are few benefits which have been granted:

  1. Can avail tax holiday in first seven yearsIn the Budget, period of tax concession has been revised for startups and firm incorporated after March 31, 2016. The Profit linked deduction available to start-ups for 3 years out of 5 years is now being revised to 3 years out of 7 years.

  2. Reduction in rate of Income Tax for MSMEs: In order to encourage firms to convert themselves into a Company, the income tax rate for Micro Small and Medium Enterprises with annual turnover of upto INR 50 crore has been reduced to 25% from existing rate of 30%.

  3. Presumptive tax: For the businesses having turnover of upto Rs 2 crores under section 44AD of the Income Tax Act, income would be presumed to be 6% (earlier 8%) of the total turnover of the assesses, provided gross receipts are received through digital means only. It definitely increase digital use for transactions and contribute a major part in the Digital India plan.

  4. Carry forward of losses despite of change in shareholdings in the Company: As per Section 79 of Income Tax Act, 1961 no loss incurred in any year prior to the previous year shall be carried forward and set off against the income of the previous year unless on the last day of the previous year, the shares of the company carrying not less than 51% of the voting power were beneficially held by persons in the year in which the loss was incurred.

    Now, the condition of continuous holding of 51% of voting rights has been relaxed in respect of eligible start-ups, however, shares must be held by the original promoter/promoters.


Let us know how you like this article. Like it and Rate it below.
133 0
0
0 stars - by 0 user(s)

Related Articles

Third World economy continues to remain as heterogeneous in nature as it has been since the middle of twentieth century. The good news is that most economies are experiencing a positive growth pattern, and becoming better off, even though population growth often dilutes that effect.

As college savings, healthcare balances and/or retirement plans are becoming a critical piece in investing, the creation of another type of investing called Variable Unit Links (VULs) are becoming ubiquitous for every investor. Let us have a look.

The term, accounting cycle, is commonly referred to as accounting process or the steps involved for all the business activities during an accounting period. It’s a standard practice in financial accounting that allows an organization to record and calculate its financial activities appropriately.