Setting up a Section 8 Company is a structured and legally recognized way to run a not-for-profit organization in India. Governed by the Companies Act, 2013, a Section 8 Company is ideal for promoting charitable, educational, social welfare, scientific, and religious objectives. Unlike private or public limited companies, a Section 8 Company does not distribute profits to its members and reinvests all earnings to further its mission.

In this guide, we’ll explore how to do Section 8 company registration and also touch upon crucial follow-up registrations like 12A & 80G, FCRA registration, and NITI Aayog registration to ensure full compliance and maximize your NGO’s impact.

What is a Section 8 Company?

A Section 8 Company is a legal entity formed with the sole objective of promoting social welfare causes, such as education, healthcare, environmental sustainability, and other charitable purposes. The hallmark of a Section 8 Company is that it cannot distribute profits to its members. Instead, all income or surplus must be used to advance its social goals.

Benefits of Section 8 Company Registration

Legal recognition under Companies Act, 2013
Higher credibility with donors and government agencies
Eligibility for 12A and 80G tax exemptions
Easy access to foreign donations post FCRA registration
Structured governance and transparent compliance
Government grants through NITI Aayog registration

Step-by-Step Process of Section 8 Company Registration

Step 1: Obtain Digital Signature Certificate (DSC)

All proposed directors must obtain a Digital Signature Certificate (DSC) to sign electronic forms submitted to the Ministry of Corporate Affairs (MCA).

Step 2: Apply for Director Identification Number (DIN)

You’ll need to apply for a Director Identification Number (DIN) for each director. This can be done while filing the company incorporation form.

Step 3: Reserve Company Name

Use the MCA’s name reservation service to file RUN (Reserve Unique Name). The name must reflect the non-profit nature of the company and should include words like “Foundation,” “Trust,” or “Association.”

Step 4: Draft MOA and AOA

Prepare the Memorandum of Association (MOA) and Articles of Association (AOA) that clearly define the mission, rules, and management structure of your organization.

Step 5: Apply for Section 8 License

Submit Form INC-12 to apply for a license under Section 8. Along with this, attach:

Company objectives
Financial projections for 3 years
List of directors and board members
MOA and AOA
Declaration of compliance

Step 6: File Incorporation Documents

Once the license is approved, file Form SPICe+ (INC-32) along with other required documents. After verification, the Registrar of Companies (ROC) issues a Certificate of Incorporation with a Company Identification Number (CIN).

Post-Incorporation Mandatory Registrations

Once your Section 8 Company is registered, you must complete the following steps to make it fully functional and compliant:

1. 12A and 80G Registration

These are essential for income tax exemption and to offer tax benefits to your donors.

12A Registration: Makes the company exempt from paying income tax on surplus funds.
80G Registration: Allows donors to claim tax deductions on donations made to your company.

You need to apply for both using Form 10A or Form 10AB on the Income Tax portal. You’ll be asked to submit audited financials, objectives, and company incorporation documents.

2. FCRA Registration

If you plan to receive foreign donations, it is mandatory to obtain FCRA (Foreign Contribution Regulation Act) registration.

You must be in existence for at least 3 years.
You should have spent ₹15 lakhs or more on core activities.
Apply using Form FC-3A (for permanent registration) or FC-3B (for prior permission).

You’ll also need a dedicated FCRA bank account with a designated branch of State Bank of India in New Delhi.

3. NITI Aayog Registration (NGO DARPAN ID)

To apply for government grants, your NGO must register on the NITI Aayog’s NGO DARPAN Portal.

Upload company details, registration certificates, and PAN.
Once approved, you’ll get a DARPAN ID, which is now mandatory for various statutory and funding applications including Form 10A and Form 10AB.

Annual Compliance for Section 8 Company

Just like any other company, a Section 8 Company must follow annual compliance rules:

File Income Tax Returns
Submit Form AOC-4 and MGT-7 annually to the ROC
Conduct and record Annual General Meetings (AGMs)
Maintain minutes and registers as per the Companies Act
Non-compliance can lead to fines and cancellation of licenses and approvals.

Common Mistakes to Avoid

Using a name that is too generic or already in use
Not clearly defining charitable objectives in MOA
Missing deadlines for tax and ROC filings
Failing to register for 12A, 80G, and FCRA in time
Delaying NITI Aayog DARPAN registration

Conclusion

Registering a Section 8 Company is the best legal structure for those looking to drive social change in India. By following the correct steps—from DSC and DIN to applying for 12A, 80G, FCRA, and NITI Aayog registration—you can ensure your NGO is compliant, credible, and eligible for funding opportunities. With careful planning and timely execution, your organization can create a lasting social impact while enjoying legal and financial benefits.

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How to Do Registration for Section 8 Company? New Guide

How to Do Registration for Section 8 Company? New Guide

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