Govt-recognised startups eligible for angel tax exemption: DPIIT Secy

A government-recognised start-up is eligible for exemption from the provisions of an Income Tax rule commonly referred to as angel tax, said Anurag Jain, secretary in the Department of Promotion of Industry and Internal Trade (DPIIT), on Thursday.

Companies recognised as startups by DPIIT are eligible for tax benefits and easier compliance. Government data showed that there are more than 84,000 DPIIT-recognised start-ups in the country.

“The section 56 (2) (viib) used to have two proviso. One was preferential treatment of foreign players. The preferential treatment has done away with. But there’s no change for start-ups. Any start-ups that are recognised by DPIIT will not attract angel tax if investment is made into them (by foreign or domestic investors),” said Jain during a post-budget interaction with reporters.