Angel Tax: deciphering the notifications and the way forward

Angel Tax: deciphering the notifications and the way forward

  • It promised an end to the dreaded “Angel Tax” regime of Section 56(2)(viib), which taxed investments from Indian investors above “Fair Market Value
  • The Good 1.Increase in the tenure and revenue threshold for a startup to 10 years and Rs 100 crore, so a company incorporated in the last 10 years which has revenue below Rs 100 crore will be considered a startup.
  • Rs 25 crore blanket exemption on any capital raised from any source, subject to a self-declaration.
  • Exempting investments from listed companies into startups from Section 56(2)(viib) provided they meet the following criteria: Their shares are frequently traded, and Their revenue is above Rs 250 crore or Their net worth is above Rs 100 crore 4.
  • On March 1, 2019, the DPIIT held another consultative meeting with various stakeholders – entrepreneurs, startups, investors, industry bodies, professionals, etc, which I had the privilege of being invited to.


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