Independent organizations that work for social and charitable purposes are called as Non-Governmental Organizations (NGOs). In order to facilitate them in contributing to the greater good, the government has allowed certain tax exemptions to such organizations. However, in order to obtain the same, these organizations have to get registered under the relevant laws in India.
Different Types of NGO Registrations in India
- Charitable Trusts as per the Indian Trust Act, 1882
- Section 8 Company as per the Companies Act, 2013
- Society as per the Society Registration Act, 1860
Let’s understand them in detail:
- Charitable Trust: This is one of the most common types of NGO registration in India. Here, the trust is incorporated as a legal entity under the Indian Trust Act, 1882 and the owner acts as the trustee of the organization. Trusts are generally of 2 types i.e., public trust or private trust. Public trust generally acts for the benefit of the general public while private trust is for the benefit of a particular group of individuals.
- Section 8 Company: Section 8 company NGO is the corporate form of NGO that gets registered under the Companies Act, 2013. Section 8 company acts as a more formal and regulated form than the trust form. Section 8 companies can be registered as either private companies or public companies.
- Society Registration: Society is another type of NGO registration that is created by a group of individuals with a common non-profit motive. It is registered under the Societies Registration Act, 1860. In the case of society registration in India, all the members of the society come together for a common motive of promoting the charitable cause.
Requirements for NGO Registration
The requirements of NGO registration depend on the constitution of the NGO, whether it is registered as a charitable trust, section 8 or society. Here are the requirements for each type of NGO incorporation:
Section 8 Company
- In the case of a private limited company, a minimum of 2 directors and in the case of a public company, a minimum of 3 directors are required.
- At least 1 director should be resident of India
- Proof of registered address of the company
- The objectives for which the company is being incorporated
- The profits earned by the company cannot be distributed among the shareholders
Also, check "Conversion of Cooperative Society into Section 8 Company"
Trust Registration
- A minimum of 2 members are required for registration of trust
- The objects of the trust shall be for the welfare of the people or charitable purpose
- All the members should be resident in India
- Proof of registered address of the company
Also, Check "Charitable Trust Registration"
Society Registration
- A minimum of 9 members are required for society registration in India
- There should be 3 members who should act as president, secretary or treasurer
- All the members should be resident in India
- Proof of registered address of the company
Process of NGO Registration
- Deciding the Type of Registration: You need to decide whether you wish to register your NGO as a Section 8 company, charitable trust or a society. The future registration process of NGO will depend on the type of NGO you wish to incorporate.
- Filing of Application: After you decide on the type of registration, you shall file the application for registration of the NGO. In the case of Section 8 company, the application shall be filed with the Ministry of Corporate Affairs (MCA). In the case of a charitable trust, the registration should be done under the Indian Trust Act, 1882 while in the case of society incorporation, the registration should be done under the Society Registration Act, 1860.
- Uploading All the Documents: You shall upload all the relevant documents required for incorporation. This includes KYC documents, address proof, director/trustee/owner details etc. Once the application is ready for submission, you shall pay the requisite fees.
- Solving Queries: In case any query is issued or any additional document, information or clarification is required, then you shall provide the same. Upon receiving the response, the concerned official shall decide on the approval or rejection thereof.
- Issue of Registration: If the registration application is approved, then the registration certificate shall be issued that acts as the incorporation document of the NGO.
- Post Incorporation Compliances: After obtaining the incorporation document, you need to fulfill the post incorporation compliances. This includes applications for PAN, income tax compliances, TDS compliances, trust-related compliances etc.
In a Nutshell
Many people incorporate NGO in India for the purpose of promoting social welfare and helping the needy. However, it is important to know the legalities of incorporation and compliances associated with the NGO. It all starts with deciding the format of incorporation followed by the registration application. Further, you should be aware of the taxation laws and post incorporation compliances to avoid any penal consequences.
ASC Group assists you with end-to-end NGO registration process, starting with helping you decide the appropriate constitution based on the nature of your activities. It helps gather all the necessary documents and filing of registration applications, including liaising with the appropriate authorities. In case you need any assistance in relation to NGO registration in India, feel free to contact the ASC Group.
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