Section 8 Company Registration allows you to start a business entity whose objective is to promote social welfare, education, charity and other altruistic activities. Synonymous of non-profit organization, it’s a company that has several benefits.
Before understanding about the concept of a Section company, you first need to ingratiate yourself with other major business entities in India. They are:
- Private Limited Company
- Public Limited company
- Nidhi Company,
- And Producer Company.
All the above business entities have different infrastructures. However, they have the same procedure of incorporation and so is their primary objective – making profits. Your Own ISP License
Making profits is not the objective of a Section 8 Company. Whatever this company earns, doesn’t directly go to its members as dividends. Instead, the profits go towards continuing its business operations which is to provide social welfare activities like:
- Promoting education,
- Giving food to the needy,
- Promoting religion,
- Organizing altruistic cultural activities,
- And, promoting other business activities
In addition to instilling a feeling of aiding the community, there are many other benefits of Section 8 Company Incorporation.
As a non profit organization, a section 8 company enjoys many tax benefits. However, most of those benefits are of the donors who contribute to this non profit business entity. They can enjoy tax deductions under section 80G of the income tax act. Read More: Startup Registration
No minimum capital requirement
if you want to truly help people, you can do so even if you don’t have any money. By paying a minimum section company registration cost, you can start a non profit organization even if you don’t any significant capital to invest in it. For instance, if you want to start a section 8 company at just 1000 rupees, you can.
No Stamp Duty payable
Unlike the other business entities, when you register a section 8 company, you don’t need to pay any stamp duty. As the purpose of this business entity is not to generate profit, but to promote social welfare activities, the government has granted some benefits to it so that more individuals are motivated to start a section 8 company.
A section 8 Company looks credible
Compared to other Non Profit organizations such as trust of society, a section 8 company appears to be more credible. Being under the governance of Ministry of Corporate affairs, this business entity has to follow more stringent rules and regulations that include:
- Inability to make changes to the Memorandum of Association and Articles of Association,
- And, regular compliance filing to assure MCA that no profit is being funnelled into the personal accounts of the members.
No requirement of a title
While you need to give you company a name when you’re going through the process of Section 8 Company Registration online, you don’t need to specify that you’re a Section 8 company. You can just put one word as the name of the company and don’t require to postfix “Section 8 Company” at the end.
A section 8 company not only lets you help people, but also grant you other benefits not known to many. In this article, we have highlighted those advantages.
If you want to gain access to these pros without paying much, get our low-cost Section 8 registration services.
Why should you register a section 8 company? What is the point? Read this blog to learn about Section 8 Company Registration benefits that you should know.