Pre-round exemption
File Form 2 before the share issue to lock exemption ex-ante.
- DPIIT recognition first
- Declaration in Form 2
- Investor self-declaration
Without exemption, share premium above fair value triggers 'angel tax' under Section 56(2)(viib) - taxed at 30% as income. DPIIT-recognised startups can file Form 2 to claim full exemption.
Starting at
₹9,999
Angel Tax Exemption
DPIIT startups raising premium rounds
Timeline
2-3 weeks
Section 56(2)(viib) treats share premium received from resident investors (in excess of fair market value) as income in the company's hands - taxed at 30%+. DPIIT-recognised startups filing Form 2 with investor declarations and committing to a ₹25 crore aggregate paid-up + premium cap are fully exempted.
TL;DR
Pvt Ltd raising at premium from resident investors? File Form 2 declaration after DPIIT to avoid the 30% angel-tax hit on every excess premium rupee.
Section 56(2)(viib)
Angel-tax provision - premium above FMV from resident investors taxed as income.
Form 2
Declaration on Startup India portal claiming exemption under Section 56(2)(viib).
₹25 crore cap
Aggregate paid-up capital + securities premium ceiling for the exemption.
File Form 2 before the share issue to lock exemption ex-ante.
Already issued at premium - file to formalise the exemption before assessment.
01
DPIIT status + aggregate paid-up + premium cap + investor type verified.
02
Form 2 + investor self-declarations drafted; PAN verifications done.
03
Form 2 filed on Startup India portal; acknowledgement obtained.
04
Stored in data room for tax assessment + investor onboarding diligence.
Upload via our secure portal. We pre-check every scan before filing - cuts portal rejections by ~90%.
Still unsure if Angel Tax Exemption is right for your case? Book a free 20-minute consult - a senior CA / CS will walk you through your specifics.
Still have questions?
Book a free 20-minute consult with a senior partner - we'll walk through your case and outline next steps.
Talk to a partner →A senior CA / CS will get on a call with you, confirm scope and start the work - usually within 24 hours.