Section 8 Company Registration: How to Start an NGO in India Legally
Starting an NGO in India? A Section 8 Company is the most trusted legal structure for non-profits, offering tax benefits, credibility, and compliance advantages. This guide explains the registration process, benefits, and compliance to help you establish your NGO smoothly.
What is a Section 8 Company?
A Section 8 Company is a non-profit organization registered under the Companies Act, 2013, for promoting:
Charity
Education
Art, science, or sports
Environmental protection
Social welfare
Key Features:
✔ No profit motive – Surplus funds must be reinvested.
✔ Limited liability – Members are not personally liable.
✔ Tax exemptions – Eligible for 80G & 12A registration.
✔ No minimum capital required.
Benefits of Registering as a Section 8 Company
Legal Credibility
Recognized by government bodies, donors, and CSR partners.
Tax Exemptions
Income tax exemption under Section 12A & 80G.
No dividend distribution tax.
Easier Funding
Eligible for grants, CSR funds, and foreign donations (FCRA registration required).
Perpetual Existence
Continues even if founders/members change.
Step-by-Step Registration Process
Step 1: Obtain DSC & DIN
Digital Signature Certificate (DSC) for directors.
Director Identification Number (DIN) via Form DIR-3.
Step 2: Name Approval (RUN Service)
Submit 1-2 name options (must reflect NGO objectives, e.g., “ABC Foundation for Education”).
Avoid words like “National,” “Government” (requires approval).
Step 3: Draft MOA & AOA
Memorandum of Association (MOA) – States objectives (must align with Section 8).
Articles of Association (AOA) – Internal governance rules.
Step 4: Apply for Section 8 License (INC-12)
Submit to Regional Director (RD) with:
MOA & AOA
Declaration by directors
Estimated income/expenditure for 3 years
Step 5: Incorporate via SPICe+ (INC-32)
File for incorporation with:
RD-approved license
Registered office proof
Director details
Step 6: Receive Certificate of Incorporation
MCA issues COI with CIN (Corporate Identity Number).
Timeline: 30-45 days (subject to RD approval).
Documents Required
Directors’ Documents: PAN, Aadhaar, address proof, photo.
Registered Office Proof: Electricity bill + rent agreement/NOC.
MOA & AOA (drafted professionally).
Estimated 3-year financials.
Post-Registration Compliance
| Requirement | Details |
|---|---|
| 80G & 12A Registration | Apply for tax exemption within 1 year. |
| Annual Filings | File AOC-4 (Financials) & MGT-7 (Annual Return). |
| FCRA Registration | Mandatory for foreign funding. |
| Board Meetings | Minimum 2 meetings/year (gap ≤ 120 days). |
Penalties: Non-compliance may lead to license cancellation.
Section 8 Company vs. Trust vs. Society
| Factor | Section 8 Company | Trust | Society |
|---|---|---|---|
| Governance | Structured (Board of Directors) | Flexible (Trustees) | Managing Committee |
| Compliance | Moderate (MCA filings) | Low | Moderate (Registrar) |
| Tax Benefits | 12A/80G eligible | 12A/80G eligible | 12A/80G eligible |
| Funding Credibility | High (CSR-friendly) | Moderate | Moderate |
Verdict: Section 8 is best for scalability and donor trust.
Why Choose Financial Munshi for NGO Registration?
End-to-End Support: From name approval to 80G/12A registration.
Expert Drafting: Compliant MOA/AOA to avoid RD rejections.
Post-Incorporation Guidance: FCRA, CSR, and annual filings.
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Frequently Asked Questions
1. Can a Section 8 Company earn profits?
Yes, but profits cannot be distributed—must fund NGO objectives.
2. How many directors are required?
Minimum 2 directors (no maximum limit).
3. Can foreign nationals be directors?
Yes, but at least 1 Indian resident director is mandatory.
4. What is the registration fee?
Approx. ₹5,000–15,000 (excluding professional charges).
5. Can an NGO convert to Section 8 later?
Yes, trusts/societies can re-register under Section 8.