Section 8 Company Registration Process: Steps & Requirements

A Section 8 company is a nonprofit organization established under Section 8 of the Companies Act, 2013, to promote charitable activities such as education, arts, science, research, and social welfare. Unlike other companies, a Section 8 company does not distribute profits among its members; instead, all profits are reinvested into the company’s objectives.

Section 8 Company Registration

The Section 8 company registration process requires compliance with legal provisions set by the Ministry of Corporate Affairs (MCA). Registration ensures legal recognition and tax benefits for nonprofit entities.

Steps for Section 8 Company Registration

The Section 8 company registration process involves the following steps:

1.Obtain Digital Signature Certificate (DSC) – The first step is acquiring a DSC for the proposed directors.

2.Apply for Director Identification Number (DIN) – Directors must obtain a DIN from the MCA.

3.Reserve Company Name – The name of the company must be unique and approved through the MCA’s Reserve Unique Name (RUN) service.

4.Drafting Memorandum of Association (MOA) & Articles of Association (AOA) – These documents outline the company’s objectives and governance structure.

5.File SPICe+ Form – This is an integrated form for company incorporation, PAN, TAN, and GST registration online.

6.Obtain MCA Approval – After verification, the MCA grants a license to operate as a Section 8 company.

7.Certificate of Company Incorporation – Once approved, the company receives its Company incorporation certificate and can commence operations.

GST Registration for Section 8 Companies

A Section 8 company that provides goods or services must register under GST registration online if it meets the prescribed GST registration limit.

Online GST Registration Process

Nonprofit organizations can apply for GST registration online through the GST portal:

1.Visit the GST portal (www.gst.gov.in).

2.Click on ‘New Registration’ and select ‘Taxpayer’.

3.Provide business details such as PAN, mobile number, and email ID.

4.Upload required GST Registration Documents.

5.Receive an Application Reference Number (ARN).

6.Verify and approve the application by GST authorities.

7.Receive the GST Registration Status and certificate.

GST Registration Documents Required

To complete GST registration, a Section 8 company must provide:

•PAN Card of the company

•MOA & AOA of the company

•Certificate of Incorporation

•Address proof of the principal place of business

•Bank account details

•Identity and address proof of directors

•Digital Signature Certificate (DSC)

GST Registration Fees and Limit

•The GST registration fees for a Section 8 company is generally zero, as the registration is free of cost.

•The GST registration limit is ₹40 lakhs for goods suppliers and ₹20 lakhs for service providers.

GST Cancellation Process

There are instances where a Section 8 company may need to cancellation of GST registration due to:

•Ceasing operations

•Turnover falling below the threshold limit

•Change in the business structure

•Non-compliance with GST regulations

How to Cancel GST Registration

The process for GST cancellation is as follows:

1.Log in to the GST portal.

2.Direct to ‘Services’ > ‘Registration’ > ‘Application for Cancellation of Registration.’

3.Provide the reason for cancellation.

4.Submit the final GST returns.

5.Verify the application using DSC or Electronic Verification Code (EVC).

6.The GST officer will review and approve the cancellation of GST registration.

Cancellation of GST Registration

Once the application for cancellation of GST registration is approved, a confirmation is sent to the registered email and mobile number. The company must ensure all compliance requirements are met before applying for cancellation.

Conclusion

A Section 8 company plays a necessary role in promoting nonprofit initiatives. Proper Section 8 company registration ensures legal recognition and enables smooth operations. Understanding GST registration, GST registration online, GST registration fees, GST registration status, and the GST cancellation process is essential for compliance. Whether applying for online GST registration or learning how to cancel GST registration, nonprofit organizations must adhere to legal guidelines to maintain credibility and tax compliance.