A Section 8 Company is a non-profit organization formed with the primary aim of promoting charitable objectives, such as education, arts, science, sports, social welfare, and environmental preservation. The earnings of these companies are reinvested into their mission and cannot be distributed as dividends to members.
At India Company Setup, we offer complete support for setting up a Section 8 Company in India. Our skilled professionals handle the entire process—from documentation to approval—making it easy and efficient for you to establish a non-profit organization. Reach out to us today to begin your Section 8 Company registration journey.
Under the Companies Act, 2013, a Section 8 Company is defined as an organization established with charitable objectives including the promotion of commerce, arts, science, education, research, religion, protection of the environment, and similar causes. These companies are prohibited from distributing profits to their members and must use their income solely to further their declared objectives.
Section 8 Companies are governed by the Companies Act, 2013, and are intended to operate as non-profit entities. Some key points include:
– They can be registered either as private or public limited companies.
– They do not require a minimum paid-up capital.
– At least two directors are necessary for registration.
– The purpose must align with social, charitable, or similar goals.
Section 8 Companies offer several advantages, such as:
– 100% tax exemption under Section 12AA of the Income Tax Act.
– No minimum capital is required, providing financial flexibility.
– Enjoy the benefits of a separate legal identity with perpetual succession.
– Enhanced credibility due to compliance with stringent legal norms.
– Freedom to choose a business name without the need to use terms like “Private Limited” or “Limited”.
Entities eligible to form a Section 8 Company include:
– Indian citizens or Hindu Undivided Families (HUF).
– Organizations or individuals aiming to promote social welfare, education, charitable work, or similar objectives.
– A minimum of one director is required.
Key incorporation requirements include:
– At least two directors for private limited, and three for public limited entities.
– Maximum of 200 members in a private structure; no limit for public.
– No mandatory capital requirement.
– The company must clearly declare non-profit objectives in its MoA and AoA.
To incorporate a Section 8 Company, the following documents are needed:
– Articles of Association (AOA) and Memorandum of Association (MOA)
– Declaration by directors and subscribers
– Proof of registered office (e.g., utility bill)
– Identity and address proofs of all subscribers and directors
– Digital Signature Certificate (DSC)
– Board resolution and other standard forms (if applicable)
Here are the steps involved:
Obtain DSC (Digital Signature Certificate)
Necessary for filing documents electronically.
Apply for DIN (Director Identification Number)
Unique ID for proposed directors.
Reserve the Company Name
File form INC-1 to secure a unique name.
File for Incorporation
Submit INC-32 along with MOA and AOA.
Apply for Section 8 License
File form INC-12 with supporting documents.
Receive Certificate of Incorporation
Form INC-16 will be issued by MCA confirming registration.
Section 8 Companies can accept public donations but not traditional capital investments or deposits. Funding avenues include:
– Domestic donations and grants
– Equity-based fundraising
– Foreign contributions (post-FCRA registration or with prior government approval)
The procedure for obtaining a Shop and Establishment registration certificate differs depending on state. It’s accessible offline and online. Most states allow one to obtain Shop and Establishment Act registration in two to three weeks. India Company Setup simplifies the registration process for a proprietorship firm.
In most sectors and businesses, a proprietorship can engage any kind of business activity that an Indian person is qualified for. Some industries, meanwhile, including banking, insurance, financial services, lending, defence, and telecommunication, call for specific authorisation. Under such circumstances, a business is legally obliged to get several Government approvals. Therefore, the structure of a proprietorship only fits for small-scale, business operations. This could be one of the restrictions of the registration of the proprietorship firm.
Some compliances relevant for a sole proprietorship registration are listed below:
Income Tax Filing: The business owner of a proprietorship will have to file a personal income tax return using the form ITR-3 or ITR-4.
Only income tax forms ITR-3 and ITR-4 let one declare company income. Hence, all proprietorships will have to file form ITR-3 or ITR-4 to be compliant with the income tax regulations.
GST Return Filing: If a proprietorship has GST registration, GST return must be filed every month and quarter as per the scheme under which the business is registered.
TDS Returns: In case the proprietorship is having employees or purchasing goods/services beyond a certain threshold – tax must be deducted at source and TDS returns must be filed every quarter.
In addition to the above, various other compliance requirements maybe applicable to the proprietorship based on industry and location.
At India Company Setup, we deliver a complete suite of business services to help you start, grow, and manage your company with ease. From registration to regulatory compliance, our expert support ensures your business stays legally sound and financially organized.
Our expert bookkeeping ensures every transaction is correctly recorded, reducing compliance errors and giving you a clear picture of your company’s financial health — crucial for GST, Income Tax, and MCA filings.
Focus on growing your business while we manage your books. By outsourcing to us, you eliminate the burden of paperwork, reconciliations, and regulatory upkeep — saving you both time and effort.
We help you monitor income and expenses in real time, so you maintain a healthy cash position, make informed decisions, and avoid last-minute cash crunches or missed tax deadlines.
A Section 8 Company is a type of not-for-profit organization established to promote charitable and socially beneficial objectives such as education, science, art, commerce, sports, research, and environmental causes. These entities are recognized under the Companies Act, 2013 but operate differently from regular companies, with a focus on community welfare rather than profit distribution.
Yes, Section 8 Companies are allowed to earn profits. However, the key condition is that all earnings must be used to further the organization’s mission. These companies may generate revenue through donations, funding, grants, and investments but cannot distribute profits among members or shareholders.
An NGO (Non-Governmental Organization) is a general term for any non-profit entity working for a social, educational, or charitable cause. A Section 8 Company is a specific legal structure recognized under the Companies Act, 2013, designed to carry out non-profit activities. While both have similar goals, Section 8 Companies operate with more formal legal and financial compliance, giving them more credibility and legal recognition.
No, physical presence is not required to register a Section 8 Company. The entire process can be completed remotely. You can email scanned copies of the necessary documents and courier the originals to our office when required.
The key documents include:
Get clear answers to frequently asked questions about proprietorship setup, benefits, legal formalities, and compliance—so you can start your business in India with clarity and confidence.
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At India Company Setup, we simplify the process of starting your proprietorship. Our expert team ensures hassle-free registration, timely support, and personalized guidance to help you launch with confidence.
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