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What Is Section 8 Company?
Section-8 Company registered under Companies Act, 2013 for social activity without having any intention for earning a profit. The primary objective of the company is working for the development of the society, protection of the earth and environment, working in the field of art, commerce, literature, sports, all living creatures protection, research, and development, etc. without earning any profit. The company is incorporated in the form of either private limited company or public limited company, but it cannot use the “private limited” or “limited” word at the end of the name of the company. The company cannot distribute the dividends to its member or share the profit. Whatever profit is earned by the company it shall be utilized only for the purpose for which the company is incorporated. In simple term, section-8 Company is a non-profit organization whose motive is to contribute its effort to the society for its development and betterment but under companies act this non-profit organization is known as section-8 Company.
Advantages of Registering a Section 8, Companies Act 2013

No Minimum Capital Requirement

No minimum capital limit has been mentioned for a Section 8 Company in India. And the capital structure may be altered at any stage as per the growth requirements of the company. This implies that it can be formed without any share capital.

Zero Stamp Duty

A Section 8 Company is exempt from the requirement of paying stamp duty on the MoA and AoA of the private or public limited company. Which is applicable for registration of other kinds of company structures.

Exemption to the donors

Those donating to a Section 8 Company are eligible for tax exemptions u/s 12A and 80G of the Income Tax Act.

Membership

A registered partnership firm can become a member in its individual capacity and obtain Directorship.

Name

Section 8 Company does not need to suffix Limited or Private Limited, next to its legal name. It can be registered with names that have words like Association, Society, Council, Club, Charities, Foundation, Academy, Institute, Organisation, and Federation.

Donation & Funding

Section 8 Company is not allowed to raise capitals by way of deposits but they can accept donations from the general public. There is no limitation to domestic donations. But to avoid money laundering cases, a proper system must be laid down to keep them in check.

Documents Required For Section 8 Company Registration

Copy of PAN Card

Two passport size Photograph

Copy of Aadhaar Card

Ownership Proof House Tax

Address Proof (Bank Statement, Electricity Bill, Telephone Bill)

No Objection Certificate

How we work?
  1. Fill our Registration Form & Make the Payment
  2. Share the required Documents after CAs Consultation
  3. Our Experts will start Drafting the Requirements
  4. Once DIN & DSC is registered we proceed for Business Name Approval Process
  5. Once Approved, your Section-8 Company is Registered.
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FAQ
What is a Section 8 Company?
A company is referred to as Section 8 Company when it registered as a Non-Profit Organization (NPO) or Non-Governmental organizations (NGOs) i.e. when it has motive of promoting arts, commerce, education, charity, protection of environment, sports, science, research, social welfare, religion and intends to use its profits (if any) or other income for under section 8(1a, 1b, 1c) of the Companies Act, 2013.
What are the Required Documents for Section 8 Company Registration?

As per the Companies Act, 2013 of the Indian Govt. the following documents are required while registering a Section 8 company:

  • Photocopy of PAN Card
  • Photocopy of Aadhaar Card
  • Address Proof (Bank Statement, Electricity Bill, Telephone Bill)
  • Two passport size Photograph
  • Ownership Proof House Tax
  • NOC ( From owners if rented )
What is the Eligibility to be Incorporated as a Section 8 company?

Any Non-Profit Organization (NPO) can be incorporated as a Sec 8 company that is being associated with:

  • Education
  • Charity
  • Arts
  • Social Welfare
  • Environmental Protection
  • Religion
  • Research
  • Sports
Can a Sec 8 Company be incorporated both as Public & Private Company?
A Sec. 8 company can be incorporated as a Public or Private Company. As per the Companies Act, 2013, it depends on the numbers of responsible people on the board. Private Company: 2 Directors, 2 members Public Company: 3 Directors, 7 members
Can a One Person Company (OPC) become a member of a Section-8 Company?
No. Following the legal directives of the Company (Incorporation) Rules, 2014 of the Indian Govt. a One Person Company (OPC) cannot become a member or be associated with a Sec. 8 company.
To which Ministry of Indian Govt. a Section 8 Company is Registered?
A Sec. 8 company is registered under the Ministry of Corporate Affairs (MCA) of the Indian Govt. Apart from that, a Sec. 8 company is mandated to follow the norms of the Reserve Bank of India (RBI) in the transaction related matters.
Can Section 8 Companies be a Holding Identity of Another Company?
Yes. A registered Sec 8 Entity under the Companies Act, 2013, can be a holding identity of another company and if needed, can promote the company as well.
Can Section 8 carry out MicroFinance Activities?
Yes. A registered Sec. 8 company in India can operate microfinance activities. But, as per the provisions of the Reserve Bank of India (RBI), the financial activities should be for the backing of social welfare.
Is it Mandatory for a Section 8 Company to Appoint an Independent Director?
No. As per the Companies Act, 2013 of the Indian Govt. a Sec. 8 Company is not mandated to appoint an Independent Director.