The Startup Compliance Handbook: Day 1 to Day 365
Founders obsess over product and funding — and then a ₹50,000 penalty for a form they’d never heard of lands in month seven. This handbook lays out everything a new Indian startup must do in its first year, in chronological order, so compliance becomes a checklist instead of a crisis.
Phase 1: Days 1–30 — Foundation
1. Incorporate the right business structure. For fund-raising startups, Private Limited Company Registration In India is almost always the preferred choice. Bootstrapped service firms often benefit from LLP Registration in India, while solo entrepreneurs can opt for One Person Company Registration in India. (For a detailed comparison, see our Company Registration Guide.)
2. Appoint your first auditor within 30 days filed via ADT-1.
3. Open the current account & deposit subscription capital. You’ll need the bank proof for INC-20A.
4. Get Digital Signature Certificates for all directors every MCA and tax filing needs them.
Phase 2: Days 30–90 — Identity & Protection
5. Startup India / DPIIT Recognition. One of the most valuable benefits of Startup Registration In India is obtaining DPIIT recognition, which offers eligibility for the Section 80-IAC tax holiday, angel-tax relief, self-certification under labour laws, IPR fast-tracking, and access to government tenders. It is the single highest-ROI registration for a genuine startup.
6.MSME Udyam Registration in India – is free, takes about 15 minutes to complete, and unlocks valuable benefits such as priority-sector lending and protection against delayed payments from large customers.
7. Protect the brand. Company-name approval from MCA gives you zero trademark rights. File Trademark / Wordmark Registration before you’re big enough for someone to squat on your name.
8. GST Registration in India is mandatory once your business crosses the prescribed turnover thresholds, engages in inter-state supply, or sells through e-commerce marketplaces. Exporting services? Add a Letter of Undertaking (LUT) to invoice clients without charging IGST.
9. Shop & Establishment Registration for your office many banks and platforms ask for it.
Phase 3: Days 90–180 — The Hard Deadline
10. INC-20A — Commencement of Business. The deadline founders miss most. File within 180 days of incorporation (after capital is deposited) or face a ₹50,000 company penalty, officer penalties, and strike-off risk. You cannot legally commence business or borrow before this is filed
11. Issue share certificates to subscribers within 60 days of incorporation; stamp them as per state law.
12. Hiring? Watch the thresholds. PF/EPFO registration (generally at 20 employees) and ESI registration (generally at 10 employees, wage-linked) become mandatory and backdated non-compliance with employee dues is expensive and painful.
Phase 4: Days 180–365 — The Operating Rhythm
13. TDS discipline. Once you pay salaries, rent or vendor fees above thresholds, deduct TDS and file quarterly returns — TDS Return Filing. Get a TAN if you don’t have one.
14. Board meetings & registers. Minimum 4 board meetings/year (gap ≤120 days; small companies/OPC get relaxations). Maintain minutes and statutory registers from day one — investors WILL check in due diligence.
15. Founders’ own taxes. Director remuneration and ESOPs have personal tax consequences — plan Individual ITR alongside the company’s.
16. Year-end closing. Statutory audit → AGM → AOC-4/MGT-7 → Company ITR-6 by 31 October. The full cycle is in our MCA Compliance Checklist and Annual Filing Deadline Calendar.
17. Raising or scaling? Increase your authorised capital before a funding round, obtain an LEI code for large credit facilities, and consider Virtual CFO Services in India once your finance function outgrows a part-time accountant to ensure better financial planning, compliance, and strategic decision-making.
The 5 Most Expensive Startup Compliance Mistakes
- Missing INC-20A — ₹50,000+ and a frozen company.
- No TDS deduction on rent/contractor payments — expense disallowance + interest + penalty.
- Skipping DPIIT recognition — paying full tax while eligible for a tax holiday.
- No founders’ agreement / unissued share certificates — due-diligence red flags that delay or kill funding rounds.
- Treating GST registration as “later” — marketplace onboarding blocked, input credit lost.
Get a Compliance Co-Founder
OurCAsaab runs first-year compliance for startups end-to-end — incorporation, DPIIT, GST, payroll registrations, TDS and the full ROC cycle — so the founder builds the product, not the paperwork.
🚀 Launch Smart. Stay Compliant. Grow Faster.
Call +91-99114 91551 or email info@ourcasaab.com to get started.
