diff --git a/features/steps/test_starter/{{ cookiecutter.repo_name }}/pyproject.toml b/features/steps/test_starter/{{ cookiecutter.repo_name }}/pyproject.toml
index ca5524efc1..cd118ef096 100644
--- a/features/steps/test_starter/{{ cookiecutter.repo_name }}/pyproject.toml	
+++ b/features/steps/test_starter/{{ cookiecutter.repo_name }}/pyproject.toml	
@@ -1,7 +1,41 @@
+[build-system]
+requires = ["setuptools"]
+build-backend = "setuptools.build_meta"
+
+[project]
+name = "{{ cookiecutter.python_package }}"
+readme = "README.md"
+dynamic = ["dependencies", "version"]
+
+[project.scripts]
+{{ cookiecutter.repo_name }} = "{{ cookiecutter.python_package }}.__main__:main"
+
+[project.optional-dependencies]
+docs = [
+    "docutils<0.18.0",
+    "sphinx~=3.4.3",
+    "sphinx_rtd_theme==0.5.1",
+    "nbsphinx==0.8.1",
+    "nbstripout~=0.4",
+    "sphinx-autodoc-typehints==1.11.1",
+    "sphinx_copybutton==0.3.1",
+    "ipykernel>=5.3, <7.0",
+    "Jinja2<3.1.0",
+    "myst-parser~=0.17.2",
+]
+
+[tool.setuptools.dynamic]
+dependencies = {file = "src/requirements.txt"}
+version = {attr = "{{ cookiecutter.python_package }}.__version__"}
+
+[tool.setuptools.packages.find]
+where = ["src"]
+namespaces = false
+
 [tool.kedro]
-project_name = "{{ cookiecutter.project_name }}"
-project_version = "{{ cookiecutter.kedro_version }}"
 package_name = "{{ cookiecutter.python_package }}"
+project_name = "{{ cookiecutter.project_name }}"
+kedro_init_version = "{{ cookiecutter.kedro_version }}"
 
 [tool.isort]
 profile = "black"
diff --git a/features/steps/test_starter/{{ cookiecutter.repo_name }}/src/pyproject.toml b/features/steps/test_starter/{{ cookiecutter.repo_name }}/src/pyproject.toml
deleted file mode 100644
index ea581e7028..0000000000
--- a/features/steps/test_starter/{{ cookiecutter.repo_name }}/src/pyproject.toml	
+++ /dev/null
@@ -1,31 +0,0 @@
-[build-system]
-requires = ["setuptools"]
-build-backend = "setuptools.build_meta"
-
-[project]
-name = "{{ cookiecutter.python_package }}"
-version = "0.1"
-dynamic = ["dependencies"]
-
-[tool.setuptools.packages.find]
-exclude = ["tests"]
-
-[project.scripts]
-{{ cookiecutter.repo_name }} = "{{ cookiecutter.python_package }}.__main__:main"
-
-[project.optional-dependencies]
-docs = [
-    "docutils<0.18.0",
-    "sphinx~=3.4.3",
-    "sphinx_rtd_theme==0.5.1",
-    "nbsphinx==0.8.1",
-    "nbstripout~=0.4",
-    "sphinx-autodoc-typehints==1.11.1",
-    "sphinx_copybutton==0.3.1",
-    "ipykernel>=5.3, <7.0",
-    "Jinja2<3.1.0",
-    "myst-parser~=0.17.2",
-]
-
-[tool.setuptools.dynamic]
-dependencies = {file = "requirements.txt"}
diff --git a/features/steps/test_starter/{{ cookiecutter.repo_name }}/src/tests/__init__.py b/features/steps/test_starter/{{ cookiecutter.repo_name }}/tests/__init__.py
similarity index 100%
rename from features/steps/test_starter/{{ cookiecutter.repo_name }}/src/tests/__init__.py
rename to features/steps/test_starter/{{ cookiecutter.repo_name }}/tests/__init__.py
diff --git a/features/steps/test_starter/{{ cookiecutter.repo_name }}/src/tests/pipelines/__init__.py b/features/steps/test_starter/{{ cookiecutter.repo_name }}/tests/pipelines/__init__.py
similarity index 100%
rename from features/steps/test_starter/{{ cookiecutter.repo_name }}/src/tests/pipelines/__init__.py
rename to features/steps/test_starter/{{ cookiecutter.repo_name }}/tests/pipelines/__init__.py
diff --git a/features/steps/test_starter/{{ cookiecutter.repo_name }}/src/tests/test_run.py b/features/steps/test_starter/{{ cookiecutter.repo_name }}/tests/test_run.py
similarity index 100%
rename from features/steps/test_starter/{{ cookiecutter.repo_name }}/src/tests/test_run.py
rename to features/steps/test_starter/{{ cookiecutter.repo_name }}/tests/test_run.py
diff --git a/kedro/templates/project/{{ cookiecutter.repo_name }}/pyproject.toml b/kedro/templates/project/{{ cookiecutter.repo_name }}/pyproject.toml
index 7ae06368bd..e555c197a6 100644
--- a/kedro/templates/project/{{ cookiecutter.repo_name }}/pyproject.toml	
+++ b/kedro/templates/project/{{ cookiecutter.repo_name }}/pyproject.toml	
@@ -1,3 +1,39 @@
+[build-system]
+requires = ["setuptools"]
+build-backend = "setuptools.build_meta"
+
+[project]
+name = "{{ cookiecutter.python_package }}"
+readme = "README.md"
+dynamic = ["dependencies", "version"]
+
+[project.scripts]
+{{ cookiecutter.repo_name }} = "{{ cookiecutter.python_package }}.__main__:main"
+
+[project.entry-points."kedro.hooks"]
+
+[project.optional-dependencies]
+docs = [
+    "docutils<0.18.0",
+    "sphinx~=3.4.3",
+    "sphinx_rtd_theme==0.5.1",
+    "nbsphinx==0.8.1",
+    "nbstripout~=0.4",
+    "sphinx-autodoc-typehints==1.11.1",
+    "sphinx_copybutton==0.3.1",
+    "ipykernel>=5.3, <7.0",
+    "Jinja2<3.1.0",
+    "myst-parser~=0.17.2",
+]
+
+[tool.setuptools.dynamic]
+dependencies = {file = "src/requirements.txt"}
+version = {attr = "{{ cookiecutter.python_package }}.__version__"}
+
+[tool.setuptools.packages.find]
+where = ["src"]
+namespaces = false
+
 [tool.kedro]
 package_name = "{{ cookiecutter.python_package }}"
 project_name = "{{ cookiecutter.project_name }}"
diff --git a/kedro/templates/project/{{ cookiecutter.repo_name }}/src/pyproject.toml b/kedro/templates/project/{{ cookiecutter.repo_name }}/src/pyproject.toml
deleted file mode 100644
index de4410c1af..0000000000
--- a/kedro/templates/project/{{ cookiecutter.repo_name }}/src/pyproject.toml	
+++ /dev/null
@@ -1,33 +0,0 @@
-[build-system]
-requires = ["setuptools"]
-build-backend = "setuptools.build_meta"
-
-[project]
-name = "{{ cookiecutter.python_package }}"
-version = "0.1"
-dynamic = ["dependencies"]
-
-[tool.setuptools.packages.find]
-exclude = ["tests"]
-
-[project.scripts]
-{{ cookiecutter.repo_name }} = "{{ cookiecutter.python_package }}.__main__:main"
-
-[project.optional-dependencies]
-docs = [
-    "docutils<0.18.0",
-    "sphinx~=3.4.3",
-    "sphinx_rtd_theme==0.5.1",
-    "nbsphinx==0.8.1",
-    "nbstripout~=0.4",
-    "sphinx-autodoc-typehints==1.11.1",
-    "sphinx_copybutton==0.3.1",
-    "ipykernel>=5.3, <7.0",
-    "Jinja2<3.1.0",
-    "myst-parser~=0.17.2",
-]
-
-[project.entry-points."kedro.hooks"]
-
-[tool.setuptools.dynamic]
-dependencies = {file = "requirements.txt"}
diff --git a/kedro/templates/project/{{ cookiecutter.repo_name }}/src/tests/__init__.py b/kedro/templates/project/{{ cookiecutter.repo_name }}/tests/__init__.py
similarity index 100%
rename from kedro/templates/project/{{ cookiecutter.repo_name }}/src/tests/__init__.py
rename to kedro/templates/project/{{ cookiecutter.repo_name }}/tests/__init__.py
diff --git a/kedro/templates/project/{{ cookiecutter.repo_name }}/src/tests/pipelines/__init__.py b/kedro/templates/project/{{ cookiecutter.repo_name }}/tests/pipelines/__init__.py
similarity index 100%
rename from kedro/templates/project/{{ cookiecutter.repo_name }}/src/tests/pipelines/__init__.py
rename to kedro/templates/project/{{ cookiecutter.repo_name }}/tests/pipelines/__init__.py
diff --git a/kedro/templates/project/{{ cookiecutter.repo_name }}/src/tests/test_run.py b/kedro/templates/project/{{ cookiecutter.repo_name }}/tests/test_run.py
similarity index 100%
rename from kedro/templates/project/{{ cookiecutter.repo_name }}/src/tests/test_run.py
rename to kedro/templates/project/{{ cookiecutter.repo_name }}/tests/test_run.py
diff --git a/tests/framework/cli/test_starters.py b/tests/framework/cli/test_starters.py
index 03e16bc29c..b8119c3268 100644
--- a/tests/framework/cli/test_starters.py
+++ b/tests/framework/cli/test_starters.py
@@ -17,7 +17,7 @@
     KedroStarterSpec,
 )
 
-FILES_IN_TEMPLATE = 29
+FILES_IN_TEMPLATE = 28
 
 
 @pytest.fixture