DPIIT Grants Tax Relief to 187 Startups Under the Revised 80-IAC Provisions

The Department for Promotion of Industry and Internal Trade (DPIIT) has approved 187 startups for income tax exemption under Section 80-IAC of the Income Tax Act. These approvals came during the 79th and 80th meetings of the Inter-Ministerial Board (IMB), with 75 startups cleared in the 79th meeting and 112 in the 80th meeting, held on April 30, 2025. 

Tax Benefit Details

Startups approved under this scheme can claim a 100% income tax deduction on profits for any three consecutive years out of 10 years from the date of incorporation. The plan is to provide financial support to early-stage ventures. This scheme supports new businesses during their early stages to foster innovation, job creation, and wealth generation.

Extension of Eligibility Window

As part of the Union Budget 2025-26 announcements, the government has extended the eligibility criteria. Startups incorporated on or before April 1, 2030, can now apply for this tax relief. Earlier, the cutoff date was set to expire sooner.

Application Process 

The DPIIT has revised the evaluation process to make it more structured. Complete applications are now reviewed within 120 days. Startups that were not approved have been advised to improve their applications and reapply. Major areas of focus include technological innovation, business potential, scalability, and employment generation.

Recognition Requirements

To apply, startups must be recognised by DPIIT and operate as a private limited company or limited liability partnership. The company’s turnover should not exceed ₹100 crore in any previous financial year.

Read more: DPIIT and YES BANK Join Forces to Empower India’s Startup Ecosystem

Recent Policy Updates

On May 9, 2025, the government also revised the Credit Guarantee Scheme for Startups. The guarantee cover was increased from ₹10 crore to ₹20 crore per borrower. Loans up to ₹10 crore will now have an 85% guarantee cover, and loans above that will have 75%. The update is meant to improve access to working capital and other credit needs.

Conclusion 

As of December 2024, over 1.57 lakh startups have been recognised by DPIIT. Since 2016, these startups have collectively generated more than 15.5 lakh direct jobs. Since the scheme's inception, over 3,700 startups have been granted exemptions. The government continued to support its dedication to building a strong, future-focused startup ecosystem for a self-reliant and innovative New India.

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