For Startups:
1. DPIIT Recognition:
Startups must register with the Department for Promotion of Industry and Internal Trade (DPIIT) to get legal
benefits.

2. What is a Startup?
- A Company which has been established for less than 10 years old
- Has Turnover less than ₹100 crore
- Working on innovation or new ideas

3. Tax Benefits:
- 3-year income tax holiday (under Section 80-IAC)
- Exemption from angel tax (Section 56(2)(viib)) if DPIIT recognized

4. Compliance Relief:
- Easy company registration
- No minimum capital required
- Self-certification for some labour and environmental laws

For Angel Investment:
1. Angel Tax:
- Tax on investment above fair market value (FMV)
- Not applicable if startup is DPIIT-recognized and meets certain conditions

2. Angel Funds (SEBI Regulation):
- Must register as Category I AIF (Alternative Investment Fund)
- Minimum investment from each investor: ₹25 lakh
- Fund size: at least ₹10 crore

3. Shareholder Agreement:
- Legal agreement between startup and investor
- Includes investor rights, profit sharing, and exit options

4. Foreign Investment:
- Startups can receive money from foreign investors under RBI rules
- Can issue convertible notes (minimum ₹25 lakh)