-
Hotline Number075048 85776
Well, when we talk about Section 8 Company people are a bit confused with the trust, society, and NGO. In short, Section 8 Company Registration, Society Registration ,Trust Registration all these are level in NGO Registration. They are basically a category of NGO registration one can opt for.
Section 8 company is the same as the NGO registration process. Section 8 Company is a non-profit organization (NPO) that can be registered as a trust, society or NGO under Section 8 of Companies Act 2013. Even registering Section8 Company offers more benefits than society registration or trust registration.
It is counted for the charitable purpose or for not-for-profit business. The license is issued to Section 8 Company under section 8 Companies act 2013. This type of Company has more credibility among donations makers, government departments, and other stakeholders.
The purpose of registering the Company is to promote Art, Science, literature Commerce, Technology, Sports, Education, Social Research, Social Welfare, Religion, Charity and Protection of Environment for charity. We take an initiative to simplify the process of company registration just for you. There are three main conditions for granting the NGO Registration license/ Section 8 Company are:
- The company must form to promote charitable objective accomplishments.
- Income and profits must be used towards these objects.
- No paying of dividends to the members of the company
Why Section 8 Company is more preferable over Trust & Society?
The first point to clear the confusion in the minds of people is NGO Registration and Section 8 company registration are no way different. But is the same. Section 8 company is more preferable because of its reach. That can be registered all over India like private limited companies. Trust & society registration are done only locally. It's better to register your NGO at the national level in the form of section 8 company. Lets' have a quick overview of the benefits of registering:
Transparency
A trust is an agreement among parties, whereby one party operates an asset for the profit of another party. Society is a group of persons, who grow together for initiating any literary, scientific or charitable purpose. "A Section 8 Company/NGO registration is a non-profit enterprise affiliated with a commercial venture. Also built for the progress of goals similar to trust or society.
Board of Management
In registering section 8 company it's clear that it will have board members. They take quick decisions and prevention of takeovers is easier than in society and Trust. How? The power of a single man prevails in a trust and a society is almost more democratic, and the consent is required for a resolution to pass.
All over India Registration
Business person or companies didn't know that for Society & Trust registration you have to make an appeal in the same state you live or reside. Like if you're from Maharashtra you have to apply for the registration in the Maharashtra itself. You cannot get it done in Delhi. so, in short, local reach only for registration, therefore choosing section 8 is a better option because it has reached all over India.
Legislation and Statue
Section 8 company register under the Indian Companies Act, 1956 applicable all over India. For Trust registration the relevant state trust act or Indian Trust Act. For society registration 1882 Societies Registration Act, 1860. So, it's true that registering sections company or NGO is much easier like any private limited company.
Change in Registered office
It's very difficult in case of bit trusts and societies but much easier in Section 8 company as eligibility reach is in all over India. The government is also preferring you to register your NGO at the national level in the form of section 8 company.
Who can apply for Section 8 company/ NGO Registration?
Eligibility criteria for a Section 8 company registration are as follows:
- Any Person
- HUF ( Hindu Joint Family)
- Limited Companies
- 2 or more persons who will act as a shareholder/director of the company
- 1 Person to be a resident of India
- NRIs or foreign national can also register
Requirements to start a section 8 company
- Minimum 2 shareholders
- Minimum 2 Directors (Directors and shareholders can be the same person)
- 1 Director must be resident in India
- No minimum -paid-up capitals
- Important documents MOA & AOA
Benefits of Section 8 Company/ Registering NGO
There are many benefits of enrolling an NGO or NPO under Section 8 of Companies Act 2013. Any partnership firm can be a part of its individual capacity and get Directorship. Some of them are as follows:.
Some of the popular trademark classes in India are
- Separate Legal Identity: Section 8 Company registration has a separate legal entity. It acquires a separate legal identity from its members.
- No minimum capital: There is no need for minimum paid-up capital.
- No minimum capital: A registered NGO gets the lawful status and becomes accountable for the funds received. For instance, when a person donates funds to a charitable trust, it is used under the name of the organization and applied for the trust’s activities. If there are unregistered firms, the assets can be taken below anyone’s name and maybe exercised for their own profit.
- Privilege to the donators: Under Section 80G, the privilege is granted to the donators if section 8 company is registered under section 80G.
- Tax Benefits: There are various tax benefits under the Section 8 Company Registration in India. Continuous obtainment of tax benefits under section 12AA and 80G of the Income Tax Act.
Documents Required for Section 8 Company / NGO Registration
- DSC & DIN of all director
- Utility Bill of the Registered Office ( Electricity, water, phone bills, etc)
- Memorandum of Association Articles of Association
- Id Proof for Members: (Aadhar Card, Passport, Voter Id)
- Passport Size Photographs
- Form DIR-2 which is consent to act as a Director.
Section 8 company/NGO Registration Procedure
Step 1: Apply for DSC, DIN:-
To register a company is applying for DSC (Digital signature) of all the directors. If you don't have any of them, the application will be made to certifying authority. It is mandatory for filling online forms for getting a license. The DIN (Director Identification Number) is also mandatory for all the partners. The Central Government provides DIN before filling the Company registration form. If the directors already have both moves to the next step.
Step 2: Apply for the name availability
For name approval, an application is file in Form INC-1 to the Registrar of the Company (ROC). Section 8 Company needs to add words such as foundation, association, forum, council, chambers, etc. complying with the Company as per incorporation rules 2014.
Step 3: File the MOA and AOA
Once the name approval from the ROC office proceeds further. One must draft Memorandum of association and Articles of Associate electronically. Both MOA and AOA. These forms are necessary to simplify the process of company registration in India. Memorandum describes the approval of the company while articles of association include the privacy rules and regulations of the company.
Step 4: Issuance of Incorporation Certificate and License
Form INC 12 registers with the ROC for the issuance of a License to the Section 8 Company under Companies Act, 2013. This includes the certificate of incorporation with a Company Identification Number (CIN). Along with PAN & TAN of the company and opening of a current bank account in the name of the company.
Step 5:Applicability of tax exemption
There is a usual idea that a Section 8 company must not pay tax as they work towards the benefit of the public at large. But this is not true. A Section 8 company, like any other legal entity, is responsible to pay tax. To be exempted from Tax, a Section 8 company is expected to get certification for the related exemptions like Section 12 A and 80G from the Income Tax Authorities
