DerpySushi
DerpySushi

Angel Tax

What is Angel tax and what are the consequences for Indian startup’s as the valuation method may not be best for startups

15mo ago
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SwirlyNoodle
SwirlyNoodle

It is simple. You invest 1 cr. in a company at 9 crs. pre-money valuation. IT department has asked to justify the 9 crs. valuation based on any of the 5 methodologies. Valuation through any of the chosen method should not be less than 9 crs.

This is needed because 1% (or 10%?) of people who use random shell companies to transfer money and ownership from here to there. Not in startup ecosystem but traditional companies.

Venture Funds are excluded from this requirement.

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