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Angel Tax, the demon that haunts startups

The Morning Brief

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The Taxman Doesn't Understand How Startups Operate

The taxman just doesn't understand how to correctly value a startup, says Achilles Ranjan. A DCF calculation is done before any cash flows after year six or year seven because of the height discount rate as you become immaterial. Myepa Nagapan, whose partner in the tax practice at Law Firm Tri-Legal, says the tax men have often gone to court against startups.

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