Karnataka Tax Incentives for Startups

Karnataka Tax Incentives for Startups

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Karnataka Tax Incentives for Startups

The Government of Karnataka is providing Incentives for Startups through state incentives and policies to elevate the startup’s growth.  According to the Karnataka Startup policy, the startups will be eligible for reimbursement of GST on any goods that are supplied to the incubatee. Reimbursement will be done annually by the Karnataka Startup Cell. In this article, we will look at the Karnataka Tax Incentives for Startups in detail.

Know more about the Government Incentives for Startups

Reimbursement of GST

The startup can claim reimbursement against net GST, concerning purchasing goods made by incubatee physically incubated in Karnataka Government-supported incubators.

Eligibility Criteria

The eligibility Criteria to avail of the Karnataka Tax Incentives for Startups are as follows:

  • The applicant should be a Startup registered with the Karnataka Startup Cell.
  • The startup should be physically incubated in any of the Government of Karnataka-supported incubators.
  • This reimbursement incentive will only apply to details of the purchase of goods provided after the date of registration with the Karnataka Startup Cell.
  • The GST is paid in Karnataka by a physically incubated Startup company/entity with an annual turnover of up to a maximum of Rs. 50 Lakhs will be eligible for this reimbursement incentive annually for the first three years of being incubated.
  • The Reimbursement amount will be released/disbursed on a seniority basis depending upon the Budget allotment of the State Government.

Documents Required

The documents required for Karnataka Tax Incentives for Startups are as follows:

  • Copy of the GST Registration and other registration of Commercial Tax Department/Central Tax Department
  • Indicate the year-wise and monthly/quarterly (as applicable) NET GST paid to the Government being claimed by the applicant
  • Copy of Tax returns filed by Startup for the year for which reimbursement is being claimed
  • GST Registration Number of the supplier
  • Relevant purchase invoices raised
  • Audited financial statements for the years for which reimbursement is claimed

Application Procedure for Karnataka Tax Incentives for Startups

The application procedure for Karnataka Tax Incentives for Startups is explained here:

  • The startup needs to access the official website of Startup Karnataka to apply for Karnataka Patent Reimbursement Incentive for Startups.
  • Click on the Register / Login Button available in the Top Right Corner of the Screen.
  • Sign Up as a Startup by filling out an application form based on the instructions provided. Existing Users can directly log in to the portal.
  • Once logged in, select the ‘Incentives’ tab available on the home page. From the menu select the Karnataka Patent Reimbursement Incentive for Startups.
  • The link will redirect to a new page, click on apply now option, and the application form will open.
  • The Eligibility Criteria and other details about Karnataka Patent Reimbursement Incentive for Startups are mentioned on the Landing page once you scroll down the page.

All reimbursements will be made subject to the consideration of the screening procedure mentioned below. The decision of the Managing Director, KBITS in this regard to sanction of any reimbursement under this incentive will be final

The Nodal Officer Karnataka Startup Cell, on receipt of the required documents, will scrutinize and perform necessary due diligence on the purchases/sales made by the applicant. On confirmation of the Startup/Incubator’s eligibility, the Karnataka Startup Cell shall make an assessment of the eligible reimbursement of GST claims. Based on this assessment, the Managing Director KBITS will sanction the eligible amount for reimbursement through a sanction order.

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Post by Renu Suresh

Renu is experience content writer specialised in compliances and company rules.