Government has launched a scheme for assisting the Start-up in a big way. There are many policy support measures and incentives. The important one is tax exemption.
Income Tax Exemption on profits under Section 80-IAC of Income Tax Act for the following eligible entities:
A private limited company or a limited liability partnership,
Incorporated on or after 1st April 2016 but before 1st April 2021, and
Products or services or processes are undifferentiated, have the potential for commercialization and have significant incremental value for customers or workflow
The deduction is for any three consecutive years out of seven years from the year of incorporation of startup.
Also, the Income Tax Exemption is allowed on the investments above fair market value for the investment made by the angel investors.