Introduction to Section-8 Company
A Section 8 Company is a type of non-profit organization in India that is formed under the Companies Act, 2013. These companies are established with the primary objective of promoting charitable activities, social welfare, and the advancement of arts, science, education, and religion. Unlike traditional profit-making companies, a Section 8 Company does not aim to generate profits for its members; instead, any surplus income is reinvested to further its social objectives.
Registering a Section 8 Company provides legal recognition, allowing organizations to operate transparently and gain credibility with stakeholders, including donors and government agencies. Additionally, Section 8 Companies can avail themselves of various tax benefits under the Income Tax Act, making them an attractive option for individuals and groups dedicated to social causes.
At Tax India Helpline, we offer expert assistance in navigating the registration process for Section 8 Companies, ensuring compliance with legal requirements and facilitating a smooth setup for your non-profit initiative.
Benefits of Registering a Section 8 Company
Legal Recognition and Credibility
Enhances trust among stakeholders, making it easier to attract support and resources for your cause.
Tax Exemptions and Benefits
Allows for income tax exemptions and donor tax deductions, encouraging contributions to the organization.
Limited Liability Protection
Safeguards personal assets of members from company debts, reducing financial risk in case of liabilities.
Ability to Raise Funds
Enables solicitation of donations and grants from the public, essential for achieving social objectives.
Access to Government Grants and Funding
Qualifies for various government schemes, enhancing financial support for non-profit initiatives.
Flexibility in Operations
Can operate in diverse sectors, adapting to the evolving needs of the communities served.
Professional Management Structure
Establishes a formal governance framework, ensuring accountability and effective decision-making within the organization.
Perpetual Succession
Ensures continuity of operations even with changes in membership, supporting long-term initiatives and projects.
Credibility for International Funding
Attracts favorable consideration from international donors, increasing funding opportunities for outreach and impact.
Documents Required for Registering a Section 8 Company
Digital Signature Certificate (DSC)Obtain DSC for all proposed directors to facilitate electronic filing of documents.
Director Identification Number (DIN)Apply for DIN for all directors, which is mandatory for registration.
Memorandum of Association (MoA)Draft and submit MoA outlining the company’s objectives and activities.
Articles of Association (AoA)Prepare AoA detailing the rules and regulations governing the company’s internal management.
Identity Proof of DirectorsProvide self-attested copies of identity proof (Aadhar card, passport, voter ID) for all directors.
Address Proof of DirectorsSubmit self-attested copies of address proof (utility bills, rental agreements) for all directors.
Registered Office Address ProofProvide proof of the registered office address (rent agreement, ownership document) along with a NOC from the property owner.
List of MembersPrepare a list of proposed members and their details, including their consent to act as members.
Estimated Income and Expenditure StatementProvide a projected income and expenditure statement for the next three years to demonstrate financial viability.
Declaration by DirectorsSubmit a declaration by directors confirming that the company will not be formed for profit-making purposes.
Step-by-Step Guide for Registering a Section 8 Company
Obtain Digital Signature Certificate (DSC)
All proposed directors must obtain a DSC to facilitate electronic filing of documents.
Apply for Director Identification Number (DIN)
Each director must apply for a DIN, which is mandatory for registration.
Draft Memorandum of Association (MoA)
Prepare the MoA, clearly outlining the objectives and activities of the Section 8 Company.
Prepare Articles of Association (AoA)
Draft the AoA detailing the internal rules and regulations governing the company.
Gather Required Documents
Collect all necessary documents, including identity proof, address proof of directors, and proof of the registered office.
File Form INC-32 (SPICe)
Submit Form INC-32 (SPICe) along with the MoA, AoA, and other required documents to the Registrar of Companies (RoC).
Obtain License under Section 8
After reviewing the application, the RoC will issue a license to operate as a Section 8 Company.
Receive Certificate of Incorporation
Once the application is approved, you will receive the Certificate of Incorporation, officially establishing your Section 8 Company.
Comply with Post-Registration Requirements
Ensure compliance with ongoing requirements, such as filing annual returns and maintaining records, to keep your company in good standing.
Deadlines and Penalties
Timely compliance with legal requirements is essential for Section 8 Companies to avoid penalties and ensure smooth operations.
Registration Deadline
Section 8 Companies must submit their registration application within 30 days of obtaining the Digital Signature Certificate (DSC) and Director Identification Number (DIN). Failing to meet this deadline may result in penalties.
Annual Returns and Financial Statements
Section 8 Companies are required to file their annual returns (Form MGT-7) within 60 days from the end of the financial year. Additionally, financial statements (Form AOC-4) must be submitted within 30 days from the date of the Annual General Meeting (AGM). Late filing can incur penalties of ₹100 per day of delay.
Non-Compliance Penalties
Providing false or misleading information during the registration process can result in fines ranging from ₹1 lakh to ₹10 lakhs, along with potential imprisonment. Persistent non-compliance with filing requirements may lead to the cancellation of the Section 8 Company’s registration.
Our Services
Private Limited Company
- Separate Legal Entity
- No Minimum Capital Requirements
- Perpetual Existence
- Limited Liability
- Less Compliance
Limited Liability Partnership
- Suitable for small businesses
- Limited Liability
- Minimum 2 Designated Partners
- Benefits of Pvt. Ltd and Partnership Firm both
- Less Compliance
One Person Company (OPC)
- Benefits of Being MSME
- Required Only One Person
- Limited Liability
- Easy Funding
- Complete Control
GST Registration
- Beneficial for start –up
- Supplier of Goods having 40 lakh turnover and Service Provider having 20 lacs
- Voluntary Registration and Composition Registration
- Less Compliance
- Eliminates Cascading Effect
FSSAI Registration
- Applicable for Food Business Vendors
- Registration, Central and State Licence
- Expansion Opportunities
- Brand Building
- License having Validity ( 1-5 yrs.)
MSME Registration
- Timely Payment of Invoices
- Benefits of Govt. Subsidy and schemes
- Easy and collateral free loans
- Benefits of Govt. Grants
- Reduced rate of registration
- Tax Exemptions
Income Tax Return
- To be Filed Every Year
- Due date 31st July ( Non- Audited)
- Income Proof
- Carry your Losses
- Filed Annually through ITR form
- Avoid penalty
- Ease in loans and getting visas
GST Return
- To be filed by every GST holder
- Accountability of the registered user
- Filing Purchase and Sales Invoices
- Quarterly and Monthly Filing
- Avoids GST Cancellation
TDS Return
- Filed by Person who liable to deduct TDS
- Return to be filed every quarter
- Legal compliance
- Consequences for non-filing
- No burden of tax annually on deductee
Import & Export Code
- Applicable for both Exports and Imports
- Any Entity can apply and take IEC
- Registration having permanent validity
- Various Govt. Incentive
- Lesser Compliance
- Scope in International market
Trademark Registration
- Safeguard name of Brand
- Any Entity can apply and TM
- Low Cost ( Protection for 10 Years)
- Build Loyalty and Trust
- Exclusive Rights
- Class Wise Registration
ROC Annual Filing
- Easy to sell or Merge
- Improved Credibility
- Access to Capital
- Avoidance of Penalties
- Legal Compliance
Frequently Asked Questions
Contact
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