Benefits Under MSMEs That Startup Owners Should Not Miss
It’s the best chance for the ones who have dreamt of having their business or want to do a startup. Due to pandemic COVID-19 the not only the Indian Economy but the World’s Economy has fallen. And to bring it up Indian Government is trying so hard to maintain its consistency. And that’s why they have made many changes in the definition of the MSME and have brought some of the best schemes, measures, and reliefs. And to promote and support the MSMEs the government is providing subsidies, schemes, incentives, and many more through the MSMED act. But to avail of these and more benefits firstly you will have to register your business or startup under MSME.
No wonder that why Government of India is showing that much interest in MSME and especially for the startups, because they have seen the magic and power of startups and the best example of Indian Startups is WOW MOMO, OLA Cabs, Address, Zomato, Paytm, FreshToHome, etc. The difference in definitions of Startups and MSMEs means that most of the startups can miss the cut-off, but the government is some changes in its policies to make it more energetic and board one of the initiatives taken by the Prime Minister, Startup India, to include more number of startups under the “Medium Industry” category that will be eligible for public procurement incentive and preferential benefits.
The motive behind this is to give an equal platform to startups also to showcase their talents and participate in the Indian Economy. Startups and businesses registered under MSME are not much different but have given different benefits and they are-
● The government will be providing early life funding, including the micro one to support the idea and development of the startups in the early stages.
● During their formative years, ESOP was considered as an important component for the compensation for those who were working as a startup employee.
● ESPOs help in maintaining the liquidity for those who don’t sell their shares easily and kees with them for a longer period.
● To boost the ecosystem of startups, the FM decided to lower down the burden of tax on the employees by deferring the tax’s payment by five years, or while leaving the company or whenever they sell the shares.
● For a good and an eligible startup turnover of Rs. 25 Crore is allowed for the deduction of which 100% of its profit shall remain with them if profit for the three consecutive years out of seven years, only if the total turnover doesn’t exceed Rs. 25 Crores.
● The limit of the turnover has been extended to Rs. 100 Crores from Rs. 25 Crores.
● The period of eligibility for claiming the deduction has also extended to 10 years from 7 years because in the initial stages startups do not work properly as they need some time to settle down and to survive.
● Knowledge Translation Clusters have been proposed to set up different technology sectors including the old and new ones.
● There have been an establishment of the small scale manufacturing facilities for designing, validation, setting up the tools and equipment, for fabrication, and many more.
● Quantum technology is spreading its aura all over the world especially in the fields of computers, communications, cybersecurity, and many more. Lots of commercial applications may emerge in it from theoretical constructs that are developing in this area. And it is also expected that an outlay of Rs. 8000 Crore will be provided for the next 5 years for the National Mission on Quantum Technologies and Applications.
Through startups, not only the economy will gain its rate or will come back again on track as it was earlier but the youth will have a chance to show their talent, creativity, ideas, and will also help in generating more jobs for the freshers, undergraduate, or for the ones who have always wished to work with the startups.
There is a hidden truth behind all the startups that without proper marketing, sitemap, communication, and many more they fail. But there is a thing which can relax you. the government will try every single thing to save your idea and will provide you with the training also under some experts. So, come up with new and exciting ideas and avail for the MSME registration.