Section 8 Company Registration
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What is Section 8 company?
Popularly known as Section 8 company is a company registered with charitable objects such as the promotion of Arts, commerce, science, education, sports, protection of the environment, religion, charity, etc. By promoting it as a not-for-profit organization, the Act does not bar the company from profit creation but rather prohibits distributing profit among members. This says that all the income or profit from any activity of the company must be utilized towards charitable purpose for which it is registered.
The charitable company is registered under Section 8 of the Companies Act, 2013, which provides it special status due to its objects. Compared to other types of companies, Section 8 company enjoys various exemptions and relaxations.
Benefits of incorporation of Section 8 company
Tax and compliance exemptions
Separate legal identity
Limited Liability
No corporate title
Documents required for formation of Charitable Company
Photograph
PAN Card
Foreign nationals must provide a valid passport.
Identity Proof
Address Proof
Business Address Proof
NOC from owner
Rent Agreement
Statement of Income & Expenditure
Formulation of Section 8 Company Name
Mainly it builds the company brand and preferably be a coined word
Second part of name should suggest the business activity of the company
Its name must include suffix like Foundation, Forum, Federation, Chambers, Association, Council, etc.
The name does not require to add any suffix like “Private Limited” or “Limited”
Register a company in 3 easy steps
1. Answer Quick Questions
- Fill in our questionnaires that take less than 10 minutes
- Provide basic details & documents required for registration
- Make payment through secured payment gateways
2. Experts are Here to Help
- Assigned Relationship Manager
- Procurement of Digital Signatures (DSC)
- Application for Name Reservation
- Documents drafting including MOA and AOA
- Application to grant license u/s 8
- Certificate of Incorporation
3. Your Company is Registered
- All it takes is 25 working days*
*Subject to Government processing time
Section 8 company registration procedure
Day 1
- Application for Digital Signature Certificate
Day 2 - 4
- Checking Name availability
- Application for Name Reservation under “RUN“
- Reservation of Name
Day 5 - 8
- Drafting of MoA, AoA & other required documents
- Payment of Stamp Duty
- Notarization of required documents
Day 9 - 13
- Application to grant a license in form INC-12
- Government processing time for approval
- License under section 8 in form INC-16
Day 14 - 16
- Filing application for company registration
- Application for DIN Allotment
- Application for PAN and TAN of company
Day 17 - 19
- Government processing time
- Certificate of Incorporation
Section 8 Company Registration
To register such company, the promoters have to ensure the following:
1) The main object of the company must be to operate for a charitable purpose and among those prescribed in law
2) Minimum 2 members of the company, who shall subscribe to capital on incorporations
3) Minimum 2 directors in the company, one of which must be Indian citizen and resident
4) The registered office of the company must be situated in India
There is no minimum amount of capital prescribed for the charitable company. The promoters may introduce the amount sufficient to start and run business.
The name of the company should be formulated as per the naming guidelines. The application for reservation of name is made in web-form called “RUN” with a maximum of 2 unique names. The registrar may ask to re-submit the application with a different name if the names do not fulfill the requirements.
The promoters shall apply in e-form INC-12 for said approval from Central Government. The form is accompanied with MoA – AoA of the company, declarations from promoters, estimated statement of income & expenditure for next three years, etc. If the application is approved, the approval letter is issued in form INC-16.
No. The registration process is completely online, the physical presence of the promoters is not required. All the documents and details can be transmitted through the mail or uploaded on our portal.
Yes, an NRI or Foreign National can be a Director in a Section 8 Company after obtaining Director Identification Number. However, at least one Director on the Board of Directors must be an Indian citizen and a resident.
The Section 8 company is popularly known as NGO. However, NGOs can be registered as other business structure like trust, society, etc.
A Section 8 or Charitable Company shall not pay any dividend to its members, but apply the surplus of receipts over payments for the promotion of its objectives.
Once the company is incorporated, it is in existence and active as long as the annual compliances are met with regularly or it is wound-up voluntarily.
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