Section 8 Company (NGO) Registration
A Section 8 Company is a non-profit organization (NGO) that aims to promote charitable activities, art, science, education, and sports. The profits of such companies are utilized for promoting these objectives and are not distributed among the Company’s members. 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.
Benefits of a Section 8 company (NGO)
Section 8 companies in India have several benefits, including…
- Tax exemptions: Section 8 companies are exempt from paying tax on income generated from charitable activities. Donors to Section 8 companies are also eligible for tax benefits under Section 80G of the Income Tax Act.
- Minimal share capital: Section 8 companies do not require a minimum paid-up share capital.
- Limited liability: Members of Section 8 companies are only allotted a limited liability.
- Non-profit objective: Section 8 companies promote healthcare, education, social, urban, and rural empowerment on a non-profit basis.
- Easy to raise funds: Section 8 companies are easy to raise funds.
- Perpetual existence: Section 8 companies have perpetual existence.
Some examples of Section 8 companies include: Reliance Foundation, Tata Foundation
Other benefits of Section 8 companies include:
- Zero stamp duty
- Separate legal entity
- Improved credibility
- Eligibility for grants
- Exempted from any name
- Eligible for foreign contribution
- Profit distribution is not permissible
The minimum requirements for a Section 8 company
- The minimum requirements for a Section 8 company in India are:
- Stockholders: At least two stockholders are required.
- Directors: At least two directors are required. Stockholders and directors can be the same person. At least one director must be an Indian resident.
- Members: A minimum of two members are required. There is no maximum limit on the number of members. Members can be individuals or entities.
- Capital: There is no minimum capital required.
- Audit: An annual audit of the company’s financial statements is mandatory.
- Income tax return: Section 8 companies are required to file an income tax return (ITR) annually.
Required documents to register a Section 8 company
- PAN card of the directors and shareholders
- Aadhaar card
- Latest bank statement
- Telephone bill or electricity bill
- Voter ID or passport or driving license
The company’s name must be unique and must not be similar to any other registered company or trademark. The company’s name must include words like Foundation, Forum, Association, Chambers, or council.
More Registration Required after Company (NGO) Incorporation:
- 12A & 80G Registration
- NGO Darpan Registration
- Trademark Registration
NCF SMART SOLUTION provide services according to your requirements, our expert team help to register section 8 companies with consultation also help you for all legal compliances.
1. What documents required to set up NGO Company in India?
You need to arrange very simple documents of director like photograph, Pan card and one address proof. For more details, please fill the above details and Get Started Now.
2. Do I have to have office (commercial) space to start a Company?
No, commercial office space is not required. You can show your own residential or rented home address as the registered office address of the Company. This office address can be changed at any time after incorporation of the company. Once your startup is set up, stable and ready to move on to a nice corporate space you can change the registered office address by informing to the ROC office.
3. Who is Registrar of Company (ROC)?
ROC is a Government office with whom companies get registered. Every State has one ROC office except Maharashtra and Tamilnadu where there are two ROC offices. In Maharashtra companies are registered with Mumbai & Pune ROC. In Tamilnadu companies are incorporated at Chennai and Coimbatore ROCs. In all other States like Delhi there is only one ROC office, like at Bangalore, Hyderabad and so on.
4. Do I have to physically visit ROC Office while Setting up company?
No. Startupwala provides complete online Company Incorporation process. All legal documentation and visits are done by Startupwala.
5. Is Private Limited Incorporation to be renewed every year?
No. Once the company is formed, it will be valid till it is officially closed down by the owners. No renewal or fees is required. However, every year companies have to file very basic returns with ROC office.
6. What is a DIN?
Director Identification Number (DIN) is a unique identification number required for a person to become a director of a company. DIN is issued by ROC office (Ministry of Corporate Affairs)
It is similar to a PAN Card number.DIN is to be mentioned in documents while appointing a person as a director of a company.
7. What is a DSC?
A digital signature is electronic signature, which is in the form of codes. It is used for signing the electronic forms, filed with ROC for incorporation of Company. Digital Signature cannot be used in physical documents.
8. What is Company name search? Why it is important for new company registration?
Company name is very important part in registration of company. The company name is divided into 3 Parts:
1) Keyword (brand name like TATA or Flipkart)
2) Activity word (i.e. showing nature of business like Software)
3) Business Type word (i.e. Pvt. Ltd. or LLP). For Incorporation of company, the suggested name should not match with existing companies or trademark.
9. What is MOA & AOA of company?
MOA means Memorandum of Association and AOA means Articles of Association. These are the byelaws or rules based on which important matters like main business of the company or meetings is decided. These are standard legal documents prepared by Company Secretaries during registration of the Company.
10. Can Section 8 Company distribute its profit to anyone?
Profit or Income of Non Profit Company can only be used for promotion of the charity work in which it is involved. Even declaration of dividend or distribution of profit to its promoters is not allowed
11. Can promoters of Non profit company can be employed as paid employee of the company?
No. Promoters of Non profit company cannot be employed as paid employee of the company
12. Can a Section 8 company be converted into private limited company?
Yes, Section 8 company be converted into private limited company after taking the approval from ROC.