Angel Tax
The local circles has raised a very pertinent question about abolition of angel tax in the budget.
In fact this is a leading cause of income tax notices on startups.
the biggest problem (most startups dont realise) is that these notices will run late.
So say your startup raised 2 crores in capital in 2015-16. this capital say finished by 2017. The notice for this will only come in 2018-19 and if by that time the capital has been used or startup is in dead state, the owners/directors will still be responsible for paying this bill of angel tax which could be like 60 lakhs plus on 2 crore raise.
This is something that must be abolished with immediate effect. Why did the UPA Govt introduce in the first place is beyond comprehension and why has the NDA Govt hun on to it for 4 years is also beyond understanding. more
In fact this is a leading cause of income tax notices on startups.
the biggest problem (most startups dont realise) is that these notices will run late.
So say your startup raised 2 crores in capital in 2015-16. this capital say finished by 2017. The notice for this will only come in 2018-19 and if by that time the capital has been used or startup is in dead state, the owners/directors will still be responsible for paying this bill of angel tax which could be like 60 lakhs plus on 2 crore raise.
This is something that must be abolished with immediate effect. Why did the UPA Govt introduce in the first place is beyond comprehension and why has the NDA Govt hun on to it for 4 years is also beyond understanding. more
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It should be abolished for first Generation entrepreneurs but not for all. YES they should be given every Possible support by providing land, Less Interest Loan etc. They need to be encouraged at all costs more
Jan 11
Tax is payable if the equity capital is raised on premium. Who stopped the startups from enhancing the equity capital and raise that at par. more
Jan 10
If there was no tax at all on the capital coming this way, this is a great loop hole to avoid tax; you have to invest this in a start up with some tacit understanding between the start up and such financiers. But to consider this as income from other sources is an extreme step. And this would go against the policy of encouraging to start start ups. But start ups do not provide for the interest/tax , whatever that may be as an expense? more
Jan 10
Angel Tax is correct in India's Context & has to be enforced on an immediate basis, not post-facto as it is being done right now .... How many World Class Angel Investors have actually invested in Fresh Start-Ups is very well known .. most of them invest only when the Real Incubation Period is coming to an end .. by then most Entrepreneurs are well aware about the various Legal & Financial Laws & Rules !! Both Investors & Entrepreneurs are by then generally prepared to follow the Laws of the Land as they should .... It is only the Black Money Investors who use any & every possible Entrepreneurship Project to try cheat the Country by inventively evading their Legal & Financial Responsibilities !!!! more
Jan 09
