ADVANTAGES & BENEFITS
Section 8 Company or a Non-Profit organisation (NPO) is a Company established for promoting commerce, art, science, religion, sports, education, research activities, charity or any other useful social object, provided the profits and donations is applied for promoting only the objects of the company and no dividend is paid to its members or owners.
The term No Profit does not mean that the Company cannot generate profit or income, but what it means is applying the income for promotion of the object and not for distributing it to the promoters. It means that the Company can earn profits but the promoters cannot be benefitted out of those profits.
Many privileges and exemptions are available to section 8 company under Company Law
Non-application of Companies Auditor’s Report Order (CARO)
Exemption from requirement of Minimum Paid-up capital
Registered partnership firm can be a member in its own capacity
Exemption of Stamp duty for registration
Tax deductions to the donors of the Company u/s. 80G of the Income Tax
DOCUMENTS REQUIRED FOR SECTION 8 COMPANY
WHAT DO YOU GET
QUESTIONS & ANSWERS
What is Section 8 Company?
A Section 8 Company (based on Section 8 of the Companies Act, 2013) is an organisation with the sole objective of promoting art, commerce, science, education, sports, social welfare, research, charity, religion, environment protection or any such non-profit objective, and where company profits are only used for company promotion and development.
Who can become a member of Section 8 Company?
Any individual, company or NRI can become a member of a Section 8 Company.
Who can or cannot incorporate a Section 8 company?
Any person or association of persons (including partnership firm) or any existing company can form a Section 8 company. A Section 8 company cannot be incorporated as a One Person Company.
Can a regular company change its status to a Section 8 Company?
Yes, any company who is already in existence can obtain the status of Section 8 Company by following the same procedure with some additional documents.