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Income Tax Checklist for Startups Raising Their First Round of Funding

1. Clean Up Past Compliance

  • File all pending ITRs and tax audit reports.
  • Clear old TDS mismatches and demands where possible.

2. Share Capital and Valuation

  • Ensure proper documentation for valuation reports.
  • Check implications of angel tax-type provisions if applicable.

3. ESOP and Employee Tax Matters

  • Review ESOP scheme structure.
  • Understand TDS / perquisite implications for employees.

4. Ongoing Compliance Post-Funding

  • Track utilisation of funds vs business plan.
  • Keep Board and investor reporting aligned with tax and financials.

5. Work With Advisors

  • Coordinate between CA, CS, and legal counsel.
  • Keep a single source of truth for cap table and tax positions.

Fastlegal Team

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