Section 8 Company Registration in India
Section 8: Company Registration in India: Process, Documents, Benefits, and Compliance
Getting Section 8 company registration done in India is basically incorporating a non-profit company under Section 8 of the Companies Act, 2013, with a license from the Registrar of Companies (RoC). The purpose for this incorporation shall be to support charitable activities, education, science, sports, social welfare, religion, environment protection, or like objects. The company will only apply its income to such objects and will not give any dividends. Minimum capital is not at all required.
You need to submit all registration details to the MCA portal via SPICe+ along with Form INC-12 (license application), which shall normally take around 15 to 30 working days to process.
What Is a Section 8 Company?
Such companies under Section 8 are considered as separate legal entities, which function like an NGO according to company laws. They have the advantage of perpetual succession, members are under limited liability, and they can own property and even make contracts, all under their company name.
| Feature | Detail |
|---|---|
| Governing law | Companies Act, 2013 |
| Regulator | Ministry of Corporate Affairs (MCA) / Registrar of Companies |
| Purpose | Charity, education, science, art, sports, social welfare, environment, and similar objects |
| Profit distribution | Not allowed. Surplus is applied only to the objects. |
| Minimum capital | None prescribed |
| Minimum directors | 2 (private) or 3 (public) |
| Minimum members | 2 (private) or 7 (public) |
| Name suffix | “Limited” or “Private Limited” can be dropped. Names often end in “Foundation,” “Forum,” “Association,” “Council,” etc. |
| Typical timeline | 15 to 30 working days |
Why Register Your Organization with a Section 8 Company?
1. It is a more credible entity to donors as well as the various government departments and CSR teams.
2. Personal assets of members are generally protected in case of company default.
3. The company operates as a separate legal entity and can own assets and sign contracts in its own name.
4. For the NGOs whose activities spread across several states, or for those that have larger grant components and need professional management, this mode is quite suitable.
5. Being the Section 8 company with 12A, 80G, and CSR-1, your organization can access corporate partnerships and various governmental grants.
6. The company will not be burdened with any hefty stamp duty on capital, because it is not the case of a shareholding company that would require minimum share capital.
Section 8: Company vs. Trust vs. Society: Which Is Better?
| Parameter | Section 8 Company | Public Charitable Trust | Society |
|---|---|---|---|
| Law | Companies Act, 2013 | Trusts Act / state laws | Societies Registration Act, 1860 |
| Registering authority | RoC (MCA) | Sub-Registrar/Charity Commissioner | Registrar of Societies |
| Legal personality | Separate legal entity | Trust is not always a separate legal person. | Separate legal entity |
| Compliance burden | Highest | Lowest | Moderate |
| Donor / CSR trust | Very high | Moderate | Moderate |
| Best for | Scalable NGOs, CSR-funded work, institutional funding | Small or family charitable work | Membership-based bodies |
If you want lighter compliance, see our pages on Public Charitable Trust Registration and Society Registration. If you want maximum credibility for funding, a Section 8 company is usually the stronger route.
Who can become the owner of a Section 8 company?
- Any person or group of persons or an existing company or LLP who intends to run charitable/non-profit operations.
- Minimum directors: 2 members (private company) or 3 members (public company) 7.
- Pursuit of objects should fall under one or more of the permitted areas: commerce, art, sciences, sports, education, research, social welfare, religion, charity, environment protection, or similar.
- Trial of profits to only be used for furthering these objects and prohibition of dividends.
Documents Required for Registering a Section 8 Company
Details of directors and members
- PAN card
- Aadhaar card, Voter ID, or Passport
- Passport-size photograph
- Address proof (bank statement or utility bill not more than two months old)
- Email ID or mobile number
Registered Office
- Rent agreement and NOC from the landlord or proof of ownership.
- Utility bill (for electricity, water, and gas) for a recent period.
Company-related documents
- Mother Memorandum of Association & Articles of Association
- Estimated statement showing income versus expenditure for the coming 3 years
- Declarations by directors and subscribers
- Digital Signature Certificates (DSC) of the proposed directors
Step-by-Step Process for Section 8 Company Registration in India
- Firstly, get a Digital Signature Certificate as well as the Directors’ Identity Number (DIN). Digital signatures are essential for every director and subscriber of the proposed company. Then, reserve the company name (SPICe+ Part A). The name should be different, depict the company objectives, and follow the name-giving rules. Prepare the MoA and AoA with the charitable objects, and without the dividend declaration, the surplus should be the only use, and no part can be kept or distributed as a dividend. Closing of SPICe+ Part B with INC-12. Submit the incorporation form along with the section 8 license request form and the necessary documents. Responding to the registrar. To avoid or at least minimize delays or even rejection, you must answer completely and quickly all the registrar’s questions. You should get the license and certificate of incorporation. The license and the certificate with the CIN are issued by the MCA. Finalizing post-incorporation formalities. Such as opening a bank account, conducting the first board meeting, and arranging tax and funding registration.
Registrations to Get After Company Registration Why it matters
12AB Registration
Gives income tax exemption on the organization’s income, subject to conditions
80G Registration
Allows donors to claim a deduction, which encourages donations
NGO Darpa
n
Unique ID used for many government grants and schemes
CSR-1 Registration
Needed to act as an implementing agency for corporate CSR funds
FCRA Registration
Required before receiving foreign contributions
E-Anudan
For certain state government grants
Just registering as a Section 8 company doesn’t automatically qualify you for the tax exemption or the right to receive foreign funds. It’s up to you and you alone to obtain these authorizations. The first 80G and 12AB are granted provisionally and later on converted into regular registration, so keep track of the timelines. You can check our Provisional to Regular 12AB and Provisional to Regular 80G guides.
Section 8 Company Annual Compliance
- Have the statutory books audited and then maintain the books of accounts.
- Provide the AOC-4 / MGT7 / MGT7A (annual report) to the RoC.
- Submit the income tax return along with the audit report (where applicable)
- Conduct the board meetings required and the yearly General Meeting
- DIRECTORS Submit DIR-3 KYC
- AUDITOR: Submit ADT-1 for auditor selection
- DONATIONS Submit Form 10BD / 10BE for donations and certificates, wherever applicable
- Keep minutes and other records of meetings.
- Prepare reports of the directors and file these with the RoC
- Record the books of accounts and file these with the audit report.
Penalties can be imposed, and licenses to be revoked are some consequences. Even if you are disqualified as a director, if the non-compliance lasts, your Section 8 certificate can be revoked. Please check out our page on Compliance for Section 8 Company for more details, and also the page on 10BD and 10BE.
Common Errors That Cause Delays to or the Collapse of the Registration
- Vague, commercial, or overly broad description in the Memorandum of Understanding (MoA) A proposed name that is very similar to the name of an existing company or registered trademark No or a weak license to occupy the property plus the lack of proof of the identity of the person or firm for whom and/or to whose care the official business communication is to be sent. Not applying for 12AB and 80G tax exemption immediately after incorporation. Blending of personal and organizational funds Skip the annual Return of Corporate Compliance (ROC) and tax filings (IT Return)
Making the Changeover of a Previous NGO
It should be the case that you have a trust or a society, and you are thinking of shifting to a stronger form, or you just want to take ownership of the old NGO; please refer to our Service Old NGO / NPO Takeover.
Always ensure you are aware of the legal and compliance history of a business before undertaking a company takeover, as this aspect can affect the viability and legality of your business in the future.
You can also use our Service Legal Due Diligence, which is helpful.
Why NGO Advisory Services?
NGO Advisory Services are a one-stop solution for registration and compliance-related activities of charitable NGOs, trusts, societies, and Section 8 companies throughout the nation.
- Choosing between the three structures (Section 8: company, trust, and society)
- Name approval, MoA and AOAs drafting, SPICE + / INC-13 filings
- Registrations: 12AB, 80G, NGO Darpan, CSR-1, FCRA & E-Anudan
- Completions of Annual Compliance, Income Tax Returns, and Appeals
- Preparation and submission of reports for CSR fund support, annual/detailed reports of projects executed, and annual reports of a company/NGO.
📞 7011821936 / 9716996688 / 011-41765979
✉️ rahul@ngoadvisoryservices.com
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Frequently Asked Questions (FAQs)
What does a Section 8 non-profit company registration in India mean?
This term simply denotes non-profit company incorporation under Section 8 of the new Companies Act 2013, which requires licensing from the Companies Registrar to carry out charitable activities.
What is the capital requirement for the company?
None. The Section 8 Companies Act does not have a clause for the lowest paid-up capital of a Section 8 company.
What is the number of directors and members required for the company?
For a private non-profit Section 8 company, a minimum of two shareholders and two directors are required. Meanwhile, in the case of a public Section 8 Company under this Act, a minimum requirement is three directors and seven shareholders.
What is the duration of the registration of the company?
Depending on the approval of the name and Registrar”s queries, registration of the company takes typically 15 to 30 working days when all the documents are ready.
Is it allowed that a Section 8 company earns a profit?
A Section 8 entity may make excess in its operations but the rules do not permit to distribute it as dividends, that is, the excess can be used only for company purposes.
Come up with your salary or remuneration package as directors?
Directors shall get their remuneration in case their activities are professional and such is permitted by the Articles and Memorandum of Association. Remuneration is not the same thing as profits.
Is a Section 8 company eligible for total income tax exemption at registration?
To get exemption under section 12A for registration of charity one needs to make a separate application, Similarly, donors who contribute will get a deduction if the entity is covered under the 80G.
Can a Section 8 company get funds as CSR?
Section 8 Company generally requires 12A and 80G and completes CSR registration before it can receive CSR funds.
Can it accept foreign donations?
Section 8 Company can accept donations from foreign sources provided the Company/NGO is FCRA registered or prior permission is obtained.
What if the company breaks the conditions of the licence?
The Central Government can revoke the licence, besides, may order the Company to be wound-up or amalgamated with a like Company.
What is best for an NGO Section 8 company, trust or society?
A Section 8 company is normally better for a company to grow, receive CSR funds, build credibility with institutional partners, government departments and institutional donors. Trusts and societies can be lighter on the regulatory front.
Conclusion
Registering a Section 8 company in India is the right option if you are thinking of a credible and a scalable NGO, a CSR partners, government Departments and institutional donor. It will call upon the company to be careful in drafting of objects and compliance of annual reports on a planned basis. Proper planning will help you to set up the entity correctly on the first time, besides, preventing costly rejection later.
If you need help, call NGO Advisory Services immediately for top-rated Section 8 registration and post-registration assistance.
