Tax holidays & IP benefits for Indian startups.
Tax holidays under Section 80-IAC, the 20-year GIFT IFSC regime, IP fee rebates under SIPP, and international-patent reimbursement under SIP-EIT. These are the highest-ROI benefits per hour of effort once the entity is set up.
Section 80-IAC is the headline tax benefit for DPIIT-recognised startups — 100% tax deduction on profits and gains for 3 consecutive years out of the first 10 years. Approval is via an Inter-Ministerial Board with historic approval rates around 1.8%, so the paperwork must be tight.
GIFT IFSC offers a 20-year tax holiday (extended from 10 years in Budget 2026-27) for entities domiciled in the international financial services centre. Especially valuable for cross-border fintech, fund management, insurance, and aircraft leasing.
For IP, SIPP gives DPIIT-recognised startups an 80% rebate on patent fees, 50% on trademarks, and access to free facilitators for filing. SIP-EIT reimburses up to ₹15 L per invention for international patent filing in electronics and IT.
Schemes that apply
8 schemes
DPIIT Startup India Recognition
The gateway credential. Itself free, but unlocks 80-IAC tax holiday, IP fee rebates, labour self-cert, GeM access, SISFS eligibility. First filing post-incorporation.
Section 80-IAC — Income Tax Holiday
100% tax deduction on profits for 3 consecutive years out of first 10. Approval rate ~1.8% — IMB scrutiny is rigorous. Time the 3-year window strategically.
Udyam Registration
Free, online MSME credential. De facto mandatory for accessing CGTMSE, PMEGP, public procurement, delayed-payment protection. File alongside DPIIT.
iStart Rajasthan
Large district-level network of incubators (Jaipur, Kota, Bikaner). Sustenance allowance, marketing and IP support.
UP Startup Policy + Fund of Funds
₹1,000 Cr Fund of Funds (SIDBI-managed). Plus seed capital, patent/IPR reimbursement, marketing support.
GIFT City IFSC — 20-Year Tax Holiday
20-year tax holiday (extended from 10 in Budget 2026-27). 100% NRI/OCI fund ownership. Zero capital gains for non-residents in Cat III AIFs.
SIP-EIT — International Patent Support
Up to ₹15 L per invention (or 50% of cost) for international patent filing.
SIPP — Startup IP Protection
80% rebate on patent fees + 50% on trademarks + expedited examination (4-6× faster). Free facilitators.
Frequently asked questions
How does Section 80-IAC tax holiday work?+
100% deduction on profits and gains for 3 consecutive years out of the first 10 years of incorporation. Pvt Ltd or LLP only (not Partnership). Eligibility window: incorporated between 1 April 2016 and 1 April 2030. Approval is via the DPIIT Inter-Ministerial Board.
Is the GIFT IFSC tax holiday really 20 years now?+
Effectively yes. Budget 2026-27 extended the qualifying window. The benefit is structured as 100% tax holiday on profits for 10 years out of any 15 consecutive years from the start of operations. Combined with extensions, the regime is widely described as a 20-year tax holiday.
What does SIPP cover for patents and trademarks?+
DPIIT-recognised startups get 80% rebate on patent fees and 50% on trademarks, plus access to a panel of facilitators whose fees are paid by the government. Examination is also expedited — 4-6× faster than the standard track.