To run an NGO in India, a non-profit organisation can be registered under any of the three options as given below:
- Trust Registration by executing a Trust deed or
- Society Registration under the Registrar of Societies, or
- Section 8 Company under the Companies Act, 2013.
There is no difference between a Section 8 Company and Section 25 Company. Under the new Companies Act 2013, Section 25 Company (as per the old Act) has now become Section 8 Company due to change in Companies Act from 1956 to 2013.
Well; you can register an NGO/NPO as Section 8 Company in the fields of promotion of arts, commerce, charity, education, protection of environment, science, social welfare, sports, research and religion with the support of our experienced Compliance Managers at Compliance Calendar LLP.
To assist you in procedure, Get in touch with us now.
The Companies Act defines a Section 8 company as one whose objectives is to promote fields of arts, commerce, science, research, education, sports, charity, social welfare, religion, environment protection, or other similar objectives.
Section 8 Company has become the most preferred form of Non-Profit Organization (NPO) or Non-Governmental organizations (NGO) in India due to its easy registration process, online secured data with www.mca.gov.in and many Features & Benefits because it functions exactly like a limited company (including all the rights and obligations that come with such a company). It has the authority to work anywhere in India.
Section 8 Company works as the Non-Profit Organizations. When we say not for profit, it does not mean that Section 8 Company cannot earn profits. In fact, such NGO/NPO can generate profits but the income of the Section 8 Company must be used to promote only charitable objects and it cannot pay any dividend to the members of the company.
This company is similar to trust and society, an exception to this is that Trust and Societies get registered under State Govt. Regulation whereas a Section 8 Company is registered online under aegis of Ministry of Corporate Affairs, Government of India.
If you want us to help you understand Section 8 Company more with regard to registration queries, Get in touch with us now.
Documents Required for Section 8 Company Registration
To register an NGO as Section 8 Company, we require certain fixed documents whose quick checklist has been given below for your easy understanding:
- Photograph of all the Directors
- PAN Card of all the Directors
- ID Proof of all the Directors (Driving License/Passport/Voter ID)
- Residence Proof (Bank Statement/Mobile Bill/Telephone Bill/Utility Bill)
- Electricity Bill or any other utility bill for the address proof of the Registered Office (along with Rent Agreement and NOC on case to case basis)
- We draft registration documents and send the same to you for signing.
Procedure for Section 8 Company Registration
Incorporation of a Section 8 Company is completely a legal work and it requires knowledge of Company Law and in-hand experience of clearing all the objections raised by the Central Registration Center (CRC)-MCA to register a Section 8 Company.
Below are the stages to register a Section 8 Company:
- Application of Digital Signature Certificate (DSC);
- Obtaining the Director Identification Number (DIN);
- Reservation of name of the Section 8 Company;
- Drafting of Memorandum of Association (MOA);
- Drafting of Articles of Association (AOA); and
- Receiving Certificate of Incorporation (COI).
Since registration of Section 8 Company is completely a legal procedure, we at Compliance Calendar LLP can help you to register your NGO if you are struggling to get proper guidance with regard to Section 8 Company legal registration process. Most of the service providers working out these days are non-professional firms. Their success rate is very low as their application for section 8 license gets too many objections and resubmissions and most of the time, it finally gets rejected.
On the other hand, the CCL is having a dedicated team of Company Secretaries who are considered domain experts in Section 8 Company Incorporation and eager to help you throughout the section 8 company registration process making it simple for you.
We also provide free consultancy to you for one year helping you out with its post-incorporation compliance with our Compliance Calendar Tools and Mechanisms.
You can Get in touch with our Compliance Manager to understand Section 8 Company annual compliance requirements including guidance with regard to their functioning and day-to-day operation, be it maintaining accounts, meeting legal compliance or making sure all the mandatory requirements of the law are fulfilled to save you from the severe fines, penalties and imprisonment due to non-compliance.
Get in touch with us now to give you a Quotation and Proposal.
Send us your queries at info@ccoffice.in or WhatsApp/Call us at +91 99 88 42 42 11.
Features & Benefits
- Tax benefits:
Section 8 Company being a non-profit organization, they leverage the exemption from the provision of income tax under section 12A and the donors also get tax deductions under section 80G of the Income Tax Act, 1961 respectively.
- Zero Stamp Duty:
A Section 8 company do not have to pay stamp duty on the AOA and MOA on its incorporation, which is compulsorily applicable on other forms of companies.
- The ease at transferring ownership/title:
The limited liability companies do not have the advantage to transfer their title or ownership, but the Income tax Act, 1961 does not confide Section 8 companies to transfer their ownership or title thereby, enabling the transfer of both movable and immovable interest without any hurdles or restrictions.
- Exempted from “Limited” name:
In contrast to other limited companies who are under obligation to use their company’s name as ‘limited company’, section 8 companies get exemption from the use of any such title. They use the word like Foundation, Association, Chamber, Confederation etc.
- Separate legal entity:
Section 8 company has a distinct legal entity which means the company’s existence is different from its members. The company has a perpetual existence along with greater flexibility.
- Uniform Registration:
Section 8 Company gets nationwide uniform registration unlike the other forms of NGOs, like Trust and Society. Further, their names are secured under CRC-MCA.
- CARO Not Applicable:
Requirements of Companies Auditor’s Report Order or CARO do not apply to Section 8 Company.
- Credibility in the eyes of public:
Section 8 Companies are more reliable than Trust and Societies. They are regulated like any other limited company strictly and have to follow the rules and regulations under Companies Act, 2013. This gives a trust and credibility in the eyes of public at large.
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