A Section 8 company is a non-profit organization formed under Section 8 of the Companies Act, 2013, to promote social welfare, education, charity, and environmental causes. Unlike other companies, it reinvests its profits into its objectives rather than distributing them among members. Registering a Section 8 company offers benefits like tax exemptions (12A & 80G registration), eligibility for CSR funds, and government support. This guide provides a step-by-step Section 8 company registration process, covering Niti Aayog Registration, CSR-1 Registration, and FCRA Registration, ensuring your NGO meets all legal and compliance requirements for smooth operations.
What is a Section 8 Company?
A Section 8 company is a not-for-profit organization that promotes activities such as:
•Education
•Science
•Religion
•Environmental protection
•Social welfare
Benefits of Section 8 Company Registration
•Tax exemptions under 12A and 80G registration
•Eligibility for CSR funds from businesses
•Credibility & government support
•Exemption from minimum capital requirement
Eligibility for Section 8 Company Registration
Who Can Apply?
•Individuals or groups intend to promote charitable activities.
•At least two directors for a private limited company or three for a public limited company.
•At least one director must be an Indian resident.
Who Cannot Apply?
•Entities intending to distribute profits.
•Individuals with criminal records.
Step-by-Step Section 8 Company Registration Process
Step 1: Obtain a Digital Signature Certificate (DSC)
•A Digital Signature Certificate (DSC) is required for all directors to sign forms digitally.
•Obtain it from a government-approved certifying authority.
Step 2: Apply for Director Identification Number (DIN)
•Directors must apply for a Director Identification Number (DIN) via SPICe+ (INC-32).
Step 3: Name Approval via RUN (Reserve Unique Name) Service
•Submit a name approval request via the MCA’s RUN Service.
•The name should reflect the company’s charitable objectives.
Step 4: Draft MoA and AoA
•Memorandum of Association (MoA) – Defines the company’s objectives.
•Articles of Association (AoA) – Establishes company rules.
Step 5: File for Section 8 License
•Submit Form INC-12 with supporting documents to obtain a Section 8 License.
Step 6: Incorporation Application (SPICe+ Form)
•File the SPICe+ (INC-32) form with MoA, AoA, and other documents.
•Once approved, you will receive the Certificate of Incorporation.
Niti Aayog Registration for Section 8 Companies
Why is Niti Aayog Registration Required?
•Required for government grants
•Essential for CSR fund eligibility
Niti Aayog Registration Process
•Register on the NGO DARPAN portal.
•Submit PAN details and company information.
•Receive a unique NGO DARPAN ID.
12A and 80G Registration for Tax Benefits
What is 12A and 80G Registration?
•12A Registration – Grants income tax exemption to NGOs.
•80G Registration – Allows donors to claim tax deductions.
12A and 80G Registration Process Online
•File Form 10A on the Income Tax portal.
•Upload required documents (MoA, AoA, PAN, etc.).
•Await verification by tax authorities.
•Receive a 12A and 80G registration certificate.
12A and 80G Registration Fees
•Government charges are minimal.
•Professional fees may vary based on consultancy services.
Corporate Social Responsibility (CSR) for Section 8 Companies
What is CSR? (CSR Full Form & Definition)
CSR (Corporate Social Responsibility) refers to companies investing in social causes.
CSR Applicability
Companies with:
•Net worth of ₹500 crore+
•Turnover of ₹1000 crore+
•Net profit of ₹5 crore+
Must spend 2% of their profits on CSR activities.
CSR-1 Registration & CSR Fund Eligibility
To receive CSR funds, Section 8 companies must:
•File Form CSR-1 on the MCA portal.
•Upload necessary documents and DSC.
•Receive CSR-1 Registration Approval.
Examples of CSR Activities
•Education & skill development
•Women & child welfare projects
•Healthcare & sanitation initiatives
•Environmental sustainability
FCRA Registration – Receiving Foreign Donations
What is FCRA? (FCRA Full Form & Definition)
FCRA (Foreign Contribution Regulation Act, 2010) regulates foreign funding to NGOs.
FCRA Registration Process
•Apply online through the FCRA Online Services portal.
•Submit Form FC-3 with financial records.
•Await approval from the Ministry of Home Affairs (MHA).
FCRA Renewal Status & Compliance
•FCRA registration is valid for 5 years.
• Renewal must be applied before expiration.
Conclusion
Section 8 Company Registration is a crucial step for those looking to establish a non-profit organization with legal recognition, tax exemptions, and funding opportunities. With benefits like 12A and 80G registration, CSR funding eligibility, and FCRA registration for foreign contributions, a Section 8 company offers credibility and compliance advantages. By following the step-by-step Section 8 company registration process, including Niti Aayog Registration and CSR-1 Registration, you can ensure smooth operations and long-term sustainability. If you're committed to social welfare, forming a Section 8 company is the best way to maximize impact while staying legally compliant.
Frequently Asked Questions (FAQs)
1. What is the process for Section 8 company registration?
Ans. The Section 8 company registration process includes obtaining a Digital Signature Certificate (DSC), applying for a Director Identification Number (DIN), name approval through RUN service, filing SPICe+ form, and securing a Section 8 license from the Registrar of Companies (ROC).
2. What are the benefits of registering for a Section 8 company?
Ans. A Section 8 company enjoys tax exemptions under 12A and 80G registration, eligibility for CSR funding, credibility for government grants, and exemption from minimum capital requirements.
3. How long does it take to register a Section 8 company?
Ans. The registration process typically takes 15-30 days, depending on documentation accuracy and approval timelines from the Ministry of Corporate Affairs (MCA).
4. Is Niti Aayog Registration necessary for Section 8 companies?
Ans. Yes, Niti Aayog Registration is required for government grants, CSR funding, and compliance with NGO regulations through the NGO DARPAN portal.
5. Can a Section 8 company receive foreign donations?
Ans. Yes, but it must have FCRA registration under the FCRA Act 2010 to legally receive foreign contributions. Renewal and compliance are managed through FCRA Online Services.
