Section 8 Company Registration in India: Step-by-Step Guide

Introduction

The section 8 company registration process in India enables individuals to establish non-profit organizations under Section 8 of the Companies Act, 2013, for charitable, educational, or social purposes. These companies enjoy tax exemptions and credibility, making them ideal for NGOs and trusts. This blog provides a detailed guide on section 8 company registration, covering steps, requirements, and post-registration compliances, and highlights how TaxQue streamlines the process for founders aiming to create impactful organizations.

What Is Section 8 Company Registration?

Section 8 company registration involves incorporating a non-profit company with the Ministry of Corporate Affairs (MCA) to obtain a Certificate of Incorporation and Corporate Identification Number (CIN). Unlike private limited or Nidhi companies, Section 8 companies reinvest profits into their objectives (e.g., education, charity) and are eligible for tax exemptions under Sections 12A and 80G of the Income Tax Act, 1961. The process requires a license from the Central Government, ensuring alignment with non-profit goals.

1. Requirements for Section 8 Company Registration

Before starting the section 8 company registration process, ensure:

• Minimum Members: 2 shareholders (individuals or entities).
• Directors: Minimum 2 directors (Indian residents; can be shareholders).
• Non-Profit Objective: Promote charity, education, health, or social welfare.
• No Minimum Capital: Authorized capital as per needs (e.g., ₹1 lakh).
• Registered Office: Proof of address (rent agreement/utility bill).
• Documents: PAN, Aadhaar, address proof for shareholders/directors; MoA/AoA draft.
• License: Section 8 license via Form INC-12 before incorporation.

2. Steps for Section 8 Company Registration

Here’s a detailed checklist for the section 8 company registration process in India:

Step 1: Obtain Digital Signature Certificate (DSC)

• Directors need Class 3 DSC for e-signing forms.
• Apply via certifying authorities on the MCA portal with PAN, Aadhaar, and photo (1–2 days).

Step 2: Apply for Director Identification Number (DIN)

• Apply for DIN for up to 2 directors via SPICe+ (Form INC-32).
• Submit identity proof (Aadhaar, passport) and address proof (utility bill); DIN is issued in 1–2 days.

Step 3: Obtain Section 8 License

• File Form INC-12 with the ROC to obtain a Section 8 license, including:
  • Draft MoA/AoA outlining non-profit objectives.
  • Declaration of no profit distribution (Form INC-14).
  • Financial projections for 3 years.
• Approval takes 5–10 days, confirming eligibility for non-profit status.

Step 4: Reserve Company Name

• Use SPICe+ Part A (RUN service) on the MCA portal to reserve a name (e.g., “Hope Foundation”).
• Avoid terms like “Private Limited”; ensure alignment with charitable objectives.
• Approval takes 2–3 days.

Step 5: File Incorporation Forms (SPICe+ Part B)

• Submit SPICe+ Part B with:
  • Approved Section 8 license (INC-12).
  • MoA/AoA, registered office details (rent agreement, utility bill, NOC).
  • PAN, Aadhaar, address proofs for shareholders/directors.
  • Declaration of compliance (Form INC-9).
• Approval (5–7 days) yields the Certificate of Incorporation, CIN, PAN, and TAN.

Step 6: Post-Registration Setup

• Open a bank account using the Certificate of Incorporation, CIN, and MoA.
• Apply for 12A/80G registration on the Income Tax portal for tax exemptions.
• Register for GST on the GST portal if applicable.

3. Post-Registration Compliances for Section 8 Companies

After completing section 8 company registration, ensure:

• ROC Filings: File Form AOC-4 (financials) by October 30 and MGT-7 (annual return) by November 29 post-AGM via the MCA portal.
• Tax Filings: Submit ITR-7 by October 31 to maintain 12A/80G exemptions.
• Audits: Conduct mandatory statutory audits annually; tax audit if income exceeds ₹5 crore (Section 44AB).
• Meetings: Hold 4 board meetings (max 120-day gap) and an AGM by September 30.
• FCRA (if applicable): Register for foreign contributions via the FCRA portal.
• Use TaxQue for compliance management.

4. Penalties for Non-Compliance

Failing to meet post-registration compliances can lead to:

• Fines: ₹100/day for late ROC filings; ₹10,000–₹1 lakh for Section 8 violations.
• Loss of Exemptions: Revocation of 12A/80G status, making income taxable.
• Legal Action: Director disqualification or company dissolution.

TaxQue simplifies section 8 company registration and post-registration compliances with expert support for INC-12, ROC, and tax filings. Visit TaxQue’s Section 8 registration guide or non-profit compliance services for tailored solutions.

FAQs

1. What is the first step in section 8 company registration?
Obtain a Digital Signature Certificate (DSC) for directors to e-sign forms.

2. How long does section 8 company registration take?
The process, including INC-12 and SPICe+, takes 15–25 days with correct documents.

3. Is a Section 8 license mandatory for registration?
Yes, Form INC-12 approval is required to confirm non-profit status before incorporation.

4. Can a Section 8 company apply for 12A/80G exemptions?
Yes, post-registration, apply for 12A/80G on the Income Tax portal for tax exemptions.

5. How does TaxQue assist with section 8 company registration?
TaxQue provides end-to-end support for DSC, DIN, INC-12, and post-registration compliances. Explore TaxQue’s compliance services.

Conclusion

The section 8 company registration process in India is a powerful way to establish a non-profit for social good. From securing a Section 8 license to filing SPICe+ and ensuring post-registration compliances like 12A/80G, each step builds a trusted organization. Platforms like TaxQue streamline section 8 company registration and ongoing obligations with expert tools and support. Start your non-profit journey today, stay compliant, and make a lasting impact.