💰 Tax Savings · Special-status benefits
Startup tax holiday — 100% profit deduction (Section 140, old 80-IAC)
✍️ EaseValue Advisors · Updated 17 Jul 2026 · FY 2025-26
In short
An eligible DPIIT-recognised startup gets a 100% deduction of its profits for any 3 consecutive years out of its first 10 — Section 140, Income-tax Act 2025 (old 80-IAC).
The benefit
Full (100%) profit deduction for 3 consecutive years chosen by the startup within its first 10 years — a genuine tax holiday during the growth phase.
Conditions
- DPIIT-recognised eligible startup, incorporated as a company or LLP within the eligible window.
- Turnover under the prescribed limit (₹100 crore) in the relevant year.
- Engaged in innovation/improvement or a scalable model with high employment/wealth-creation potential; not formed by splitting an existing business.
- An inter-ministerial certificate of eligibility is required.
Note: MAT/AMT can still apply, and founders can pair this with capital-gains reinvestment into the startup (old 54GB) and ESOP TDS deferral for employees.
Who it helps
Recognised startups turning profitable within their first decade — time the 3-year window to your most profitable years.
The law behind it
Section 140 (old 80-IAC)
General information for FY 2025-26 (AY 2026-27), not advice on your specific case. Limits, rates and conditions
change with each Finance Act and depend on your facts — confirm before acting. © EaseValue Advisors LLP.
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