Section 80-IAC → Section 140
Special provision in respect of specified business (Eligible Start-ups)
Quick Answer
Section 80-IAC of the Income Tax Act, 1961 (Special provision in respect of specified business (Eligible Start-ups)) corresponds to Section 140 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.
What changed for Section 80-IAC
Under the Income Tax Act, 1961, Section 80-IAC governs special provision in respect of specified business (eligible start-ups). Allows a 100% deduction of profits for 3 consecutive years out of the first 10 years for an 'Eligible Start-up' recognized by DPIIT.
The new code maps this to Section 140: the provision is retained and renumbered as Section 140 of the Income-tax Act, 2025, applying from 1st April 2026. Retained and heavily linked with digital verification. The incorporation deadline is actively extended via Finance Acts.
On the ground, changes to Section 80-IAC carry a Very High impact. The holy grail of tax incentives for Indian tech start-ups.
Sec 80-IAC
Provision Summary
Allows a 100% deduction of profits for 3 consecutive years out of the first 10 years for an 'Eligible Start-up' recognized by DPIIT.
Sec 140
Provision Summary
Retained and heavily linked with digital verification. The incorporation deadline is actively extended via Finance Acts.
Key Changes & Highlights
- Direct API integration with the Inter-Ministerial Board (IMB) database to auto-validate start-up status during ITR filing.
Related Sections
Frequently Asked Questions
What does Section 80-IAC of the Income Tax Act 1961 deal with?
Section 80-IAC of the Income Tax Act, 1961 covers special provision in respect of specified business (eligible start-ups). Allows a 100% deduction of profits for 3 consecutive years out of the first 10 years for an 'Eligible Start-up' recognized by DPIIT.
Where does Section 80-IAC of the ITA 1961 go under the Income-tax Act, 2025?
Section 80-IAC of the Income Tax Act, 1961 maps to Section 140 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained and heavily linked with digital verification. The incorporation deadline is actively extended via Finance Acts.
Why does the change to Section 80-IAC matter for taxpayers?
The transition impact for Section 80-IAC is rated Very High. The holy grail of tax incentives for Indian tech start-ups.
What are the key changes to Section 80-IAC under the Income-tax Act, 2025?
Direct API integration with the Inter-Ministerial Board (IMB) database to auto-validate start-up status during ITR filing. These points are specific to Section 80-IAC (Special provision in respect of specified business (Eligible Start-ups)).
Disclaimer: This mapping of Section 80-IAC (Special provision in respect of specified business (Eligible Start-ups)) to Section 140 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 80-IAC is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.
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