Introduction: What is a Section 8 Company & Why It’s the Most Trusted NGO Structure?
In today’s India, when an individual or group wants to make a lasting impact through education, charity, health, environment, or social welfare — choosing the right legal structure is critical. Among all options like Trusts, Societies, and Foundations — the Section 8 Company stands out as the most legally robust, government-recognized and internationally trusted NGO structure.
Governed by the Companies Act, 2013, Section 8 Companies are non-profit entities established to promote commerce, arts, science, sports, education, research, social welfare, religion, charity, protection of environment, or any other useful objective, without the intention of profit distribution.
At RegistrationMART, with 10+ years of expertise in company and NGO registrations, we’ve guided hundreds of changemakers through the legal maze of forming Section 8 Companies. In this comprehensive guide, we break it all down for you:
Table of Contents
- What is a Section 8 Company?
- Benefits of Registering as Section 8 Company
- Section 8 Company vs Trust vs Society
- Eligibility Criteria
- Step-by-Step Registration Process
- Mandatory Documents Checklist
- Post-Incorporation Compliances
- Tax Benefits: 12A & 80G
- Foreign Funding & FCRA
- Annual Compliance Requirements
- Common Mistakes to Avoid
- How RegistrationMART Can Help
What is a Section 8 Company?
A Section 8 Company is a special type of company registered under Section 8 of the Companies Act, 2013, whose primary objective is to promote not-for-profit activities. However, unlike Trusts and Societies, it operates under the stricter framework of the Ministry of Corporate Affairs (MCA), ensuring transparency, credibility, and accountability.
🔹 Key Feature: Profits (if any) must be reinvested in the company’s mission, not distributed as dividends.
Why Choose Section 8 Company?
Here are the advantages that make it the most preferred NGO model in India:
| Benefit | Description |
| ✅ High Credibility | Recognized by MCA and regulated under Companies Act |
| ✅ Limited Liability | Liability of members limited to shares they hold |
| ✅ Tax Benefits | Eligible for 12A, 80G, GST Exemptions |
| ✅ Foreign Funding | Easier to get FCRA approval compared to Trusts |
| ✅ Legal Structure | Corporate governance, board of directors, audited books |
| ✅ No Stamp Duty | Registration exempt from stamp duty on MOA & AOA |
| ✅ Global Acceptability | Preferred by international donors, embassies, CSR wings |
Section 8 Company vs Trust vs Society
| Feature | Section 8 Company | Trust | Society |
| Registration Act | Companies Act, 2013 | Indian Trusts Act, 1882 | Societies Registration Act, 1860 |
| Regulator | MCA | Charity Commissioner | Registrar of Societies |
| National Validity | Yes | No (state-specific) | No (state-specific) |
| Audit Compulsory | Yes | Depends | Depends |
| Governance | Board of Directors | Trustees | Governing Council |
| Foreign Funding | Easy (FCRA eligible) | Moderate | Moderate |
| Legal Standing | High | Moderate | Moderate |
Eligibility to Register a Section 8 Company
You are eligible if:
- You are an individual or group of persons (Indian or foreign nationals)
- You want to pursue non-profit objectives
- You don’t intend to distribute profits among members
- Your objectives fall under promotion of commerce, art, charity, environment, education, social welfare, etc.
Minimum requirements:
| Requirement | Private Limited | Public Limited |
| Members | 2 | 7 |
| Directors | 2 | 3 |
| No. of shareholders | 2+ | 7+ |
| Director DIN | Mandatory | Mandatory |
| PAN / Aadhaar | Mandatory | Mandatory |
Step-by-Step Registration Process
Step 1: DSC (Digital Signature)
- Get Digital Signature Certificates (DSC) for all proposed directors.
Step 2: Name Approval (RUN Form)
- Apply for name reservation using RUN (Reserve Unique Name) form.
- Names should end with “Foundation”, “Association”, “Federation”, “Council”, “Institute” etc.
- Avoid “Limited” or “Private Limited”.
Step 3: Drafting MOA & AOA
- Draft Memorandum of Association (MOA) and Articles of Association (AOA) with charitable objectives.
Step 4: Filing SPICe+ Form
- File SPICe+ Form with:
- MOA, AOA
- KYC of directors
- Declaration by professionals (CA/CS)
- Consent letters
Step 5: INC-12 (License Application)
- Apply to ROC for license under Section 8 using INC-12 form.
- Attach:
- Project Report
- Estimated income & expenditure (3 years)
- Board resolution
- Undertaking of not distributing profits
Step 6: Certificate of Incorporation
- On approval, MCA issues:
- License under Section 8
- Certificate of Incorporation
- PAN & TAN
Your Section 8 Company is legally registered!
Documents Required
| For Directors | For Company |
| PAN Card | MOA & AOA |
| Aadhaar/Passport | Address Proof (Electricity Bill/Lease) |
| Photo & Email ID | Proposed activities report |
| DIN (if available) | Income & expenditure projections |
| Digital Signature (DSC) | NOC from landlord (if rented office) |
Post-Incorporation Compliances
Once registered, a Section 8 Company must:
- Open current bank account in company’s name
- Apply for 12A and 80G (Income Tax Act)
- Register on NGO Darpan Portal
- Apply for FCRA, if planning for foreign donations
- Maintain statutory registers
- Conduct annual board meetings and maintain minutes
Tax Benefits – 12A & 80G Registration
| Provision | Benefit |
| 12A | NGO income is tax exempt |
| 80G | Donors get tax deduction for donations made |
🔹RegistrationMART helps file both within 30 days of incorporation
🔹 Issued by Income Tax Department
🔹 Valid for 5 years, renewable
Foreign Funding Eligibility – FCRA
Section 8 Companies are preferred entities for FCRA Registration, because:
- Their legal structure matches corporate compliance expectations
- They maintain audited books, project reports, and governance
- International donors trust the MCA-regulated setup
FCRA permission must be applied separately after 3 years of operations (or via prior permission).
Annual Compliance Checklist
| Compliance | Timeline |
| Board Meetings | Minimum 2/year |
| AGM | Once a year |
| Annual Return (Form MGT-7) | Within 60 days of AGM |
| Financials (Form AOC-4) | Within 30 days of AGM |
| DIR-3 KYC | Annually for directors |
| Income Tax Return | By 30th September |
| Audit of Accounts | Mandatory |
| Form CSR-1 | If receiving CSR funds |
Late filing attracts heavy penalties under Companies Act.
Common Mistakes to Avoid
- Using wrong objectives (must be charitable, not profit-oriented)
- Not preparing 3-year income & expense estimate
- Using profit-distribution terms in MOA
- Ignoring 12A/80G or FCRA follow-up
- Delaying annual filings (MCA charges ₹100 per day per form!)
Always seek professional help to avoid cancellation or fines.
How RegistrationMART Helps
We at RegistrationMART specialize in NGO, Company, and Tax registrations, with 10+ years of expert legal experience. Here’s what we offer:
✅ Free consultation for structure selection
✅ End-to-end Section 8 Company registration
✅ MOA/AOA drafting & license filing
✅ PAN, TAN, GST assistance
✅ 12A, 80G, CSR-1, FCRA applications
✅ Full compliance package (ROC + ITR + Audit)
We’ve successfully registered 300+ NGOs and social ventures, ensuring peace of mind and full legal coverage.
Conclusion: Build a Legal Foundation for Your Mission
A Section 8 Company gives your social cause the highest legal credibility in India. Whether you’re applying for a UN grant, CSR funding, or international donor partnership a Section 8 structure sends a signal of trust, compliance, and professional governance.
But registration is just the beginning maintaining compliance is what sustains your mission.
👉 Let RegistrationMART be your long-term legal partner to build a compliant, sustainable, and impactful organization.
