Start-ups get partial relief as Centre eases Angel Tax exemption rules
New Delhi, Jan 17 (IBNS): In a bid to give relief to start-up founders and investors dealing with the issue of "Angel Tax", the government has notified changes in Section 56 of the Income Tax Act, officials said on Thursday.
" After intense deliberation, the government has issued a notification to ease availment of #angeltax exemption. Refer to the notification for more details : http://bit.ly/2AOIbNL #StartupIndia," tweeted Department of Industrial Policy & Promotion, Ministry of Commerce & Industry.
The department further said neither the Inter-ministerial board certificate nor a merchant banker certificate is required for Angel tax exemption.
As per reports, Angel Tax is imposed on companies on the difference between the premium value and fair market value of shares.
The department said for the startup to be eligible for Angel Tax Exemption, the aggregate amount of paid up share capital and share premium of the Startup after the proposed issues of shares, should not exceed Rs. 10 crores.
"(4/9):For the Investor to be eligible for #AngelTax Exemption, she/he should have filed Income tax returns of alteast INR 50 Lakhs for the year preceding the investment year. #StartupIndia," it said in another tweet.
"(5/9): Additionally, the investor’s net worth should exceed INR 2 Crores or the amount of investment proposed in the Startup, whichever is higher, as on the last date of the financial year preceding the investment year. #StartupIndia," it said.
The department further said to further the ease of application, startups are not required to submit investor income and net worth details.
'Keeping confidentiality of investor tax returns and net worth certificate in mind, the investors can now directly upload these details on the DIPP portal," it said.
"Angeltax exemption applications of DIPP recognized startups will be directly evaluated by CBDT going forward," the department said.
The department said: "(9/9): The scope of the #Angeltax exemption extends to all past and future investments, and applies for startups incorporated before April 2016 as well. #StartupIndia."
Support Our Journalism
We cannot do without you.. your contribution supports unbiased journalism
IBNS is not driven by any ism- not wokeism, not racism, not skewed secularism, not hyper right-wing or left liberal ideals, nor by any hardline religious beliefs or hyper nationalism. We want to serve you good old objective news, as they are. We do not judge or preach. We let people decide for themselves. We only try to present factual and well-sourced news.
Support objective journalism for a small contribution.
