See what you qualify for
DPIIT / CBDT

Section 80-IAC: a 3-year income-tax holiday for startups

A 100% income-tax deduction for eligible startups for three consecutive years.

Check your eligibilityTalk to an advisor
50+
80-IAC approvals secured
₹141.6 Cr+
Raised via debt & equity
2,700+
Startups & SMEs served
5.0
335+ Google reviews
Zero-Scam
Honest advice over the upsell

What the exemption actually gives you

Section 80-IAC gives a DPIIT-recognised startup a 100% deduction on its profits for any three consecutive financial years chosen from its first ten since incorporation, provided turnover stays under ₹100 crore in the year claimed. In effect, no income tax is payable on those profits for the three years selected; the rupee value depends on how profitable the company is in those years.

  • 100% tax deduction for 3 consecutive years — Out of the first 10 years since incorporation.
  • The three years are chosen from the first ten since incorporation, so the relief lands when profits are highest.

For a company approaching profitability, 80-IAC keeps three years of income tax inside the business — money that can fund hiring, product and runway instead of a tax outflow.

The incorporation window now runs to 2030

Until the Finance Act 2025, a startup had to be incorporated before 1 April 2025 to claim 80-IAC. That deadline was extended by five years. The current position: the company must be incorporated on or after 1 April 2016 and before 1 April 2030, with turnover not exceeding ₹100 crore in the financial year for which the deduction is claimed.

This matters because a good number of pages still print the old 2025 cutoff and tell founders incorporated in 2025 or 2026 that they have missed it. They have not.

How the Inter-Ministerial Board actually decides

80-IAC is not a filing you complete and receive. DPIIT recognition gets you to the door; the exemption itself is granted by the Inter-Ministerial Board, which meets periodically and assesses each application on its merits.

  • The Board had held 80 meetings by 30 April 2025, when it cleared 112 startups — 187 across its 79th and 80th sittings together.
  • More than 3,700 startups have been granted the exemption since the scheme began.
  • Under the revised evaluation framework, DPIIT has committed to reviewing complete applications within 120 days.
  • The operative word is complete. An application missing documents, or one that answers a Board query slowly, restarts its own clock.

What the Board is testing is genuine innovation and scalability — whether the business improves a product, process or service in a way that is materially different from what already exists, and whether it can scale to create employment or wealth. It is a real bar, not a formality.

What the application has to contain

  • A valid DPIIT recognition certificate — the prerequisite, not part of this application.
  • Incorporation documents, PAN, and the MoA.
  • Shareholding pattern as per the MoA and the current structure, reconciled.
  • Financial statements for the years since incorporation.
  • A pitch deck or supporting write-up making the innovation case in terms the Board can assess.

Why applications get rejected

  • The innovation case is thin. The most common failure by some distance — a business that is competent but reads as an existing model executed locally.
  • No clear differentiation. The write-up describes what the company does without establishing how it differs from what already exists.
  • Incomplete documentation. Missing attachments or a shareholding pattern that does not reconcile.
  • Slow responses to Board queries. A request for clarification answered late, or partially, can end the application.

Eligibility at a glance

  • DPIIT-recognised startup incorporated as a Private Limited Company or LLP.
  • Incorporated on or after 1 April 2016 (within the window notified by the government).
  • Annual turnover within the limit prescribed for the relevant year.

Final eligibility is always confirmed against the scheme guidelines in force when you apply.

How CapEasy handles your 80-IAC claim

  1. Assess eligibility honestly — we check DPIIT status, the incorporation window and turnover first, so you only invest time if you genuinely qualify.
  2. Build the application — we assemble the financials, projections and supporting material the Inter-Ministerial Board expects.
  3. File and time the claim — we submit to the IMB and help you choose the best three consecutive years to take the deduction.

We assemble the financials and application the IMB expects and help you time the three-year claim.

Verified August 2026 against the Finance Act 2025 amendment and DPIIT’s published IMB outcomes. CapEasy is a private consultancy and is not affiliated with any government authority; approval rests solely with the Inter-Ministerial Board. Official scheme page →

From the casebook

Tax work like this

The holiday only pays off if the claim stands up. A few tax engagements from the casebook.

All case studies →
Tax Structuring & Optimisation
3 yearsIncome-tax exemption

Securing Section 80IAC Tax Exemption for a Clean Energy Startup

An innovative clean-energy startup had developed proprietary waste processing technology but was unaware that it qualified for benefits under Section 80IAC of the Income Tax Act. The founders were preparing for expansion and wanted to preserve cash for product development rather than paying avoidable income tax.

Confidential · Waste-to-Energy & Clean Technology · Growth
Tax Structuring & Optimisation
₹12 croreAnnual revenue at engagement

Tax Restructuring for a Fast-Growing IT Services Company

A five-year-old IT services company based in Bengaluru had crossed ₹12 crore in annual revenue and was experiencing healthy profitability. However, the promoters were paying significantly more tax than necessary because the business had evolved without revisiting its legal and tax structure. Director remuneration, dividend distribution, and operational expenses were not aligned with long-term tax planning, leading to unnecessary tax leakage every financial year.

Confidential · IT Services & Software Development
Tax Structuring & Optimisation

Optimising Promoter Compensation and Tax

The promoters of a profitable healthcare-services group in Bengaluru were drawing income in a way that had grown up organically, without tax planning — an inefficient mix of salary, dividend, and informal drawings that increased their overall tax burden and complicated the company’s books.

Confidential · Healthcare Services
Free eligibility check · about 60 seconds

See which schemes you qualify for

Answer four quick questions and we’ll map the exemptions and schemes — including 80-IAC — your startup can claim.

Question 1 of 4

How long since you incorporated?

Frequently asked

80-IAC, answered plainly.

Section 80-IAC of the Income-Tax Act lets an eligible DPIIT-recognised startup deduct 100% of its profits and gains for three consecutive financial years. In effect it is a three-year income-tax holiday on eligible profits, intended to help young companies reinvest early earnings into growth.

For each of the three claimed years, eligible profits are deducted in full, so the income tax that would otherwise apply to those profits is not payable. The rupee value depends entirely on how profitable the company is in the years it claims — there is no fixed figure.

Any three consecutive financial years chosen out of the first ten years since incorporation. Because you choose the window, the deduction is usually most valuable in the years a startup turns meaningfully profitable.

Broadly: a DPIIT-recognised startup incorporated as a Private Limited Company or LLP, incorporated within the window notified by the government, and with annual turnover within the prescribed limit for the relevant year. Exact eligibility is confirmed against the scheme guidelines at the time of applying.

Yes. DPIIT recognition is a prerequisite for 80-IAC. If a company is not recognised yet, that is the first step — and it can be done before the 80-IAC application is prepared.

After DPIIT recognition, the 80-IAC application is submitted to an Inter-Ministerial Board (IMB) with the company’s financials and supporting material. The Board reviews each application on its merits; review timelines vary case by case.

Yes. The Finance Act 2025 extended the incorporation window by five years. A startup must now be incorporated on or after 1 April 2016 and before 1 April 2030 to be eligible. Pages still quoting a 1 April 2025 cutoff are out of date.

Turnover must not exceed ₹100 crore in the financial year for which the deduction is claimed.

Under the revised evaluation framework, DPIIT has committed to reviewing complete applications within 120 days. The word doing the work there is “complete” — a missing document or a slow reply to a Board query extends it, and no advisor can promise a date.

Most often because the innovation case is thin — the business is competent but reads as an existing model executed locally. Other common causes are no clear differentiation from what already exists, incomplete documents, a shareholding pattern that does not reconcile, and slow responses when the Board asks for clarification.

More than 3,700 since the scheme began. The Inter-Ministerial Board had held 80 meetings by 30 April 2025, clearing 187 startups across its 79th and 80th sittings.

We confirm eligibility honestly up front, assemble the financials and application the Board expects, file it, and help time the three-year claim. We don’t promise approval or a fixed timeline — no advisor truthfully can — but we make sure a genuinely eligible company is presented as strongly as possible.

Book a free consultation.

An honest assessment of where you are and what comes next — no cost, no pressure, no inflated promises.

Book a consultation →WhatsApp us →