80IAC – Startup Tax Exemption

One of the major benefits of the Startup India initiative is the income tax exemption under Section 80-IAC of the Income Tax Act. This exemption allows eligible startups to claim a 100% tax holiday for 3 consecutive years out of their first 10 years since incorporation.

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Benefits of 80IAC Tax Exemption

100% Tax Exemption: No income tax liability for 3 out of the first 10 years of incorporation.
Cash Flow Relief: Retain profits and reinvest in business growth during critical early years.
Boosts Investor Confidence: Recognized tax exemption strengthens startup valuation and investor trust.
Government Recognition: Enhanced credibility with IMB approval and DPIIT-recognized startup status.

Eligibility Criteria

To apply for 80-IAC exemption, the startup must:

Be recognized by DPIIT as a startup.
Be incorporated as a Private Limited Company or LLP.
Be incorporated on or after April 1, 2016.
Have an annual turnover of less than ₹100 Crores in any financial year.
Be engaged in innovation, development, or improvement of products/processes/services, or have a scalable business model with a high potential for employment or wealth creation.
Not be formed by splitting up or reconstruction of an existing business.

Application Process

DPIIT Recognition Check
If not already done, we help you get DPIIT Startup Recognition (mandatory prerequisite).
Document Preparation
We assist in preparing a business plan, financial projections, and innovation details required for the 80-IAC application.
Online Application Filing
Submission of the 80-IAC application via the DPIIT portal, along with necessary declarations and attachments.
IMB Review
The Inter-Ministerial Board evaluates your application. On approval, you receive the Tax Exemption Certificate.