Budget 2023- Extension of date of incorporation for eligible start-up for exemption
The existing provisions of the section 80-IAC of the Act, inter alia, provides for a deduction of an amount equal to hundred percent of the profits and gains derived from an eligible business by an eligible start-up for three consecutive assessment years out of ten years, beginning from the year of incorporation, at the option of the assessees subject to the condition that,
(i) the total turnover of its business does not exceed one hundred crore rupees,
(ii) it is holding a certificate of eligible business from the Inter-Ministerial Board of Certification, and
(iii) it is incorporated on or after 1st day of April, 2016 but before 1st day of April 2023.
2. In order to further promote the development of start-ups in India and to provide them with a competitive platform, it is proposed to amend the provisions of section 80-IAC of the Act so as to extend the period of incorporation of eligible start-ups to 1st day of April 2024.
3. This amendment will take effect from the 1st day of April, 2023 and shall accordingly, apply in relation to the assessment year 2023-24 and subsequent assessment years.
[Clause 41]
Extract of relevant clause of Finance Bill 2023
Clause 41 of the Bill seeks to amend section 80-IAC of the Income-tax Act relating to special provision in respect of specified business.
The said section, inter alia, provides for a deduction of an amount equal to one hundred per cent. of the profits and gains derived from an eligible business by an eligible start-up for any three consecutive assessment years out of ten years, beginning from the year of incorporation, at the option of the assessee subject to the conditions specified therein.
It is proposed to amend sub-clause (a) of clause (ii) of the Explanation to the said section so as to extend the period of eligible start-ups before which they are to be incorporated from “1st April, 2023” to “1st April, 2024”.
This amendment will take effect from 1st April, 2023 and will, accordingly, apply in relation to the assessment year 2023-2024 and subsequent assessment years.
Extract of Relevant Amendment Proposed by Finance Bill, 2023
41. Amendment of section 80-IAC.
In section 80-IAC of the Income-tax Act, in the Explanation, in clause (ii), in sub-clause (a), for the figures “2023”, the figures “2024” shall be substituted.
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we have received Income Tax exemption under 80 IAC under startup India. How do we claim our Tax benefits. We have started our factory in 2017-18.