Business News Desk, Startups around the world including India are still struggling with the problem of funding (Startups Funding Winter). Meanwhile, startups in India have received good news on this front. CBDT has released a list of 21 countries from where startup angel tax will not be levied on investment in startups.The 21 countries which have been given this exemption by the Central Board of Direct Taxes (CBDT) include countries like USA, UK and France. . NRI investment in Indian startups from these countries will not attract angel tax. This exemption will be available on investment in such startup companies, which are not yet listed in the stock markets. Countries like Singapore, Netherlands and Mauritius have been kept out of this exemption.
was proposed in the budget
Presenting the budget in February, Finance Minister Nirmala Sitharaman had proposed to bring foreign investment in unlisted companies under the ambit of angel tax. The CBDT issued a notification in this regard on May 24 regarding investors who would not be covered by the provisions relating to angel tax. Earlier in the budget proposal, investment in startups recognized by DPIIT (DPIIT) was kept out of the purview of angel tax.
they will get the benefit of exemption
Investors now exempt from angel tax include investors registered with SEBI as Category-I FPIs, endowment funds, pension funds and broad-based investment vehicles. According to the notification, apart from the US, UK and France, Australia, Germany, Spain, Austria, Canada, Czech Republic, Belgium, Denmark, Finland, Israel, Italy, Iceland, Japan, South Korea, Russia, Norway, New Zealand and Sweden are included. .
Changes apply from April 1
This notification of CBDT has become effective from 1 April 2023. This means that such investments before the issue of notification will also get this exemption, which have come after April 1, 2023. However, experts are surprised that countries like Singapore, Ireland, Netherlands and Mauritius have not found a place in this notification, from where India has been getting a major share of FDI. Released at a time when startups around the world are facing the problem of funding shortage, which is being known as funding winter.