Section 80-IAC: a 3-year income-tax holiday for startups
A 100% income-tax deduction for eligible startups for three consecutive years.
What the exemption actually gives you
A 100% income-tax deduction for eligible startups for three consecutive 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. It is one of the most valuable benefits a DPIIT-recognised startup can claim, which is exactly why the application is worth getting right.
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.
Start with DPIIT recognition
DPIIT (Startup India) recognition is a prerequisite for 80-IAC — it comes first.
How CapEasy handles your 80-IAC claim
End to end — assess, build, file. The paperwork stays off your plate.
- Assess eligibility honestly — we check DPIIT status, the incorporation window and turnover first, so you only invest time if you genuinely qualify.
- Build the application — we assemble the financials, projections and supporting material the Inter-Ministerial Board expects.
- 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.
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.
Frequently asked questions
What is the Section 80-IAC tax exemption?
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.
How much tax can a startup actually save?
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.
Which three years can be claimed?
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.
Who is eligible for 80-IAC?
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.
Is DPIIT (Startup India) recognition required first?
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.
How does the application work?
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.
How does CapEasy help with 80-IAC?
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.
Talk to a CapEasy advisor
Tell us about your startup and we’ll confirm your 80-IAC eligibility and the cleanest route to the exemption — free, no obligation.