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Tax incentives for venture capital

Discuss Tax incentives for venture capital within the Financial Management ( FM ) forums, part of the Resolve Your Query - Get Help and discuss Projects category; Tax incentives for venture capital In September 1995, Government of India issued guidelines for overseas venture capital investment in India ...

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Sunanda K. Chavan
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Tax incentives for venture capital - September 10th, 2010

Tax incentives for venture capital


In September 1995, Government of India issued guidelines for overseas venture capital investment in India whereas the CBDT issued guidelines for tax exemption purposes. (The RBI governs the investment and flow of foreign currency in and out of India.) As a part of its mandate to regulate and to develop the Indian capital markets, Securities and Exchange Board of India (SEBI) framed the SEBI (Venture Capital Funds) Regulations, 1996.


SEBI was recognized as the single nodal agency.
A new clause u/s 10(23FB) of Income Tax Act was introduced with effect from 1st March 2000. This clause stated that any income, of a venture capital company or a venture capital fund, from any investments made in venture capital undertaking, would not be included in computing the total income.

Section 115U was also introduced in the Income Tax Act with effect from the assessment year 2001-02 to establish a VC pass through. This means that the VC profits will not be taxed twice. The regulated VC Fund (with SEBI) would be exempted from tax (subject to certain conditions) but the VC investor will have to pay tax.
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Rose Marry
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Re: Tax incentives for venture capital - April 11th, 2016

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Originally Posted by sunandaC View Post
Tax incentives for venture capital


In September 1995, Government of India issued guidelines for overseas venture capital investment in India whereas the CBDT issued guidelines for tax exemption purposes. (The RBI governs the investment and flow of foreign currency in and out of India.) As a part of its mandate to regulate and to develop the Indian capital markets, Securities and Exchange Board of India (SEBI) framed the SEBI (Venture Capital Funds) Regulations, 1996.


SEBI was recognized as the single nodal agency.
A new clause u/s 10(23FB) of Income Tax Act was introduced with effect from 1st March 2000. This clause stated that any income, of a venture capital company or a venture capital fund, from any investments made in venture capital undertaking, would not be included in computing the total income.

Section 115U was also introduced in the Income Tax Act with effect from the assessment year 2001-02 to establish a VC pass through. This means that the VC profits will not be taxed twice. The regulated VC Fund (with SEBI) would be exempted from tax (subject to certain conditions) but the VC investor will have to pay tax.
Hey buddy,

Here I am uploading Tax Incentives and Venture Capital Financing, so please download and check it.
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File Type: pdf Tax Incentives and Venture Capital Financing.pdf (320.6 KB, 0 views)
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