A company that may earn, but may never distribute
That single restriction is what a Section 8 licence buys you, and it is why a non-profit incorporated under the Companies Act carries a credibility that a trust deed rarely does. This page sets out how the licence is obtained, what the Registrar actually examines, and the tax registrations that follow.
Position stated as at 21 October 2026, under the Companies Act, 2013 and the Income-tax Act, 2025 read with the Income-tax Rules, 2026.
What a Section 8 company actually is
Section 8 of the Companies Act, 2013 lets the Central Government licence a company that intends to promote commerce, art, science, sports, education, research, social welfare, religion, charity, protection of the environment or any similar object.
Two conditions attach. The company must apply its profits and other income only to promoting those objects, and it must not pay any dividend to its members. In return it is relieved of the obligation to carry Limited or Private Limited in its name, which is why these entities commonly read as a Foundation, Sansthan, Trust, Society, Council or Association without being any of those things in law.
A Section 8 company is still a company. It files with the Registrar, keeps statutory registers, appoints an auditor and holds board and general meetings. What it gains over a trust or a society is a single national registration, perpetual succession, limited liability and a governance record that institutional donors, CSR committees and foreign funders can examine.
The restriction that defines it
Members may be reimbursed and employees may be paid a reasonable salary. What cannot happen is a distribution of surplus to members in their capacity as members, in any form, at any time. On winding up, remaining assets must go to another company with similar objects, not back to the members.
Which structure fits your purpose
Most people arrive at Section 8 having been told it is the serious option. Sometimes a trust or a society is a better fit, and it is cheaper to find that out now than after incorporation. Answer five questions.
Structure finder
Indicative only. It weighs the five factors that most often decide the question.
| Point | Section 8 company | Public charitable trust | Registered society |
|---|---|---|---|
| Governing law | Companies Act, 2013 | Indian Trusts Act 1882 / State trust Acts | Societies Registration Act, 1860 and State amendments |
| Registering authority | Central Registration Centre, MCA | Sub-Registrar / Charity Commissioner | Registrar of Societies of the State |
| Geographic reach | National on a single registration | Varies by State | Usually State-specific; national registration is a separate step |
| Minimum people | 2 directors and 2 subscribers for a private structure | Commonly 2 trustees | Commonly 7 members |
| Name ending | No Limited or Private Limited required | Free | Free |
| Annual filings | AOC-4, MGT-7, auditor appointment, income-tax return and audit | Lighter, State dependent | Annual list of members, State dependent |
| CSR donor comfort | Generally strongest, with CSR-1 on record | Accepted with CSR-1 | Accepted with CSR-1 |
| Amending objects | Requires MCA approval | Difficult once the deed is settled | Requires member approval and filing |
How the licence and incorporation now happen together
This is the part most older articles get wrong. A new Section 8 company no longer files Form INC-12 to obtain a licence before incorporating. The licence application is built into SPICe+ Part B, and the licence number is issued alongside the Certificate of Incorporation. Form INC-12 survives only for an existing company that later seeks a Section 8 licence.
Digital signatures and director identification
A Class 3 DSC for every proposed director and subscriber. Directors who already hold a DIN use it; new DINs are allotted through SPICe+ itself, so no separate DIR-3 is filed.
Name reservation through SPICe+ Part A
Two preferences, checked against existing companies, LLPs and registered trade marks. The object must be visible in the name; a name suggesting trade or manufacture will not sit comfortably with a Section 8 object clause.
Drafting the constitutional documents
The memorandum goes in Form INC-13, which follows the format prescribed in Schedule I for Section 8 entities and is not interchangeable with an ordinary MOA. Articles are settled alongside, usually on the Table F pattern adapted for a non-profit board.
Declarations and projections
Form INC-14 is a declaration by a practising Chartered Accountant, Company Secretary or Cost Accountant that the documents conform to Section 8. Form INC-15 is a declaration by each subscriber. Rule 19 also requires a three-year projected statement of income and expenditure, which the Registrar reads as evidence that the stated objects are actually intended.
SPICe+ Part B with the linked forms
Filed with e-MOA (INC-13), e-AOA (INC-31), the INC-9 declaration generated by the system, and AGILE-PRO-S for GSTIN, EPFO, ESIC, professional tax where applicable and the bank account.
Scrutiny at the Central Registration Centre
The CRC examines the object clause, the projections and the declarations. Resubmission queries are common on Section 8 filings precisely because the objects are examined on merit rather than accepted at face value. There is a limited window to reply.
Certificate of Incorporation with the licence
Issued with the CIN, the Section 8 licence number, PAN and TAN together.
| Form | What it is | Filed how |
|---|---|---|
SPICe+ Part A | Name reservation | MCA V3 portal |
SPICe+ Part B | Incorporation together with the Section 8 licence | MCA V3 portal |
INC-13 | Memorandum of association in the Section 8 format | Linked to SPICe+ |
INC-31 | Articles of association | Linked to SPICe+ |
INC-14 | Declaration by a practising professional | Attachment |
INC-15 | Declaration by each subscriber | Attachment |
INC-9 | Declaration by subscribers and first directors | Generated by SPICe+ |
AGILE-PRO-S | GSTIN, EPFO, ESIC, professional tax, bank account | Linked to SPICe+ |
INC-20A | Declaration of commencement of business, within 180 days | After incorporation |
INC-12 | Licence application — only for an existing company | Standalone |
Before you settle on a name
Name rejection is the commonest cause of delay. This checks the rules that are mechanical. It cannot check availability — only the MCA portal and a trade mark search can do that.
Name rule check
Checks length, prohibited and restricted words, and whether the name suits a Section 8 object.
What we will ask you for
Nothing is filed until this is complete, because a part-filled SPICe+ invites a resubmission query. Tick as you gather. Nothing you tick is sent anywhere — it stays in your browser.
Document readiness
0 of 0 ready
Proposed company
Registered office — rented or leased
Registered office — owned
Company contact details
Each director and subscriber
Prepared by us
The tax registrations, under the law as it now stands
Incorporation gives you a company. It does not give you exemption, and it does not give your donors a deduction. Those are two separate applications to the income-tax authorities, and from 1 April 2026 they sit under new section numbers.
The Income-tax Act, 2025 replaced the Income-tax Act, 1961 with effect from 1 April 2026, and the Income-tax Rules, 2026 replaced the 1962 Rules. Everything that was scattered across sections 11, 12, 12A, 12AA, 12AB, 13, 10(23C) and 80G now sits in one place: Part B of Chapter XVII, sections 332 to 355. Entities in that chapter are called registered non-profit organisations.
| What it does | Income-tax Act, 1961 | Income-tax Act, 2025 |
|---|---|---|
| Registration of the non-profit | 12A / 12AA / 12AB and 10(23C) | 332 |
| Approval allowing donors a deduction | 80G | 354 |
| The donor's deduction itself | 80G | 133(1)(b)(ii) |
| Permitted modes of investment | 11(5) and 13(1)(d) | 350 read with Schedule XVI |
| Specified violations and cancellation | 12AB(4) | 351 |
| Tax on accreted income | 115TD | 352 |
| Anonymous donations | 115BBC | 355(a) |
| Definitions, including the new status | — | 355(g) |
| Purpose | Old form | Form from 1 April 2026 |
|---|---|---|
| Provisional registration | 10A | 104 |
| Regular registration or renewal, and section 354 approval | 10AB | 105 |
| Audit report | 10B / 10BB | 112 |
| Statement of donations received | 10BD | 113 |
| Certificate issued to a donor | 10BE | 114 |
Two practical points. Registration under section 332 does not by itself give your donors anything — section 354 approval is a separate application and must be maintained separately. And where total income does not exceed five crore rupees in each of the two tax years preceding the application, registration may run for ten tax years instead of five, which materially reduces the renewal burden on a small organisation.
A certificate issued before 1 April 2026 quoting section 12AB or 80G remains valid for its stated period. The clock did not restart. But a registration that had already lapsed before that date does not revive, and a fresh application under section 332 is required.
What happens after the certificate arrives
Enter the date of incorporation and this maps the obligations that follow, with their due dates.
Post-incorporation roadmap
Dates are computed from the statutory periods. Confirm against your own facts.
What a Section 8 company carries every year
The licence is not a one-off. It can be revoked under section 8(6) where the company operates fraudulently or against its own objects, and the consequences reach the directors. The annual discipline is the protection.
| Obligation | Form or action | When |
|---|---|---|
| Declaration of commencement of business | INC-20A | Within 180 days of incorporation |
| Appointment of the first auditor | Board resolution, then ADT-1 | Within 30 days of incorporation |
| Board meetings | Minimum as applicable to the company | Through the year |
| Annual general meeting | — | Within the period allowed under section 96 |
| Financial statements | AOC-4 | Within 30 days of the AGM |
| Annual return | MGT-7 | Within 60 days of the AGM |
| Director KYC | DIR-3 KYC | Annually, for every DIN holder |
| Income-tax return and audit report | Return, with Form 112 | As applicable to the tax year |
| Statement of donations and donor certificates | Form 113 and Form 114 | By 31 May following the tax year |
| Renewal of registration and approval | Form 105 | At least six months before expiry |
CSR funding
A company receiving CSR funds must be registered with the MCA in Form CSR-1. Without it, a donor company cannot treat the spend as CSR, however worthy the cause.
Foreign contributions
Foreign donations need FCRA cover. Registration normally expects a track record of three years and a minimum spend on core activities; a newly incorporated entity usually starts with prior permission for a specific donor and project.
NGO Darpan
A NITI Aayog Darpan ID is not a registration, but it is a practical precondition for most government grant schemes and is often asked for by CSR committees.
Where these filings go wrong
An object clause written to be broad
Ordinary incorporations benefit from wide objects. Here the opposite is true. A clause that reads like a trading company, or that bundles unrelated activities to keep options open, draws a query. Write what you will actually do.
Projections produced to fill a box
The three-year projection is read. Figures that do not relate to the stated activities, or that show no application of income at all, invite scrutiny of whether the objects are genuinely intended.
Treating the licence as the tax exemption
A Section 8 licence is a Companies Act licence. Exemption comes from registration under section 332, and the donor deduction from approval under section 354. Each is applied for separately, and each lapses separately.
Missing the renewal window
Renewal in Form 105 is due at least six months before expiry, not on expiry. A lapsed registration does not revive on application; income ceases to be exempt until a fresh registration is granted.
Questions we are asked
Is Form INC-12 still required to register a Section 8 company?
Not for a new company. The licence application is integrated into SPICe+ Part B and the licence number is issued with the Certificate of Incorporation. Form INC-12 is now used where an existing company applies for a Section 8 licence.
What is the minimum capital for a Section 8 company?
No minimum paid-up capital is prescribed. Authorised capital is set to suit the intended structure, and the stamp duty on incorporation follows from it.
How many directors and subscribers are needed?
Two directors and two subscribers for a structure on the private pattern, three directors and seven subscribers on the public pattern. The same person may be both a director and a subscriber.
Does the name have to end with Limited or Private Limited?
No. Relief from that requirement is one of the privileges the licence carries. Names commonly end with Foundation, Sansthan, Council, Association, Federation or similar words reflecting the object.
Can the directors be paid?
Reasonable remuneration for services actually rendered is permissible and should be approved and documented properly. What is prohibited is distribution of surplus to members as members — dividend by any name.
What replaced 12A and 80G registration from 1 April 2026?
Registration of the non-profit is now under section 332 of the Income-tax Act, 2025. Approval that lets donors claim a deduction is under section 354, with the deduction itself at section 133(1)(b)(ii). Both are applied for in Form 105 under the Income-tax Rules, 2026, with provisional registration in Form 104.
Our 12AB certificate quotes an old section. Is it still valid?
Yes. A valid, uncancelled registration granted before 1 April 2026 continues for the period stated on the certificate. The validity period did not restart. Renewal, when it falls due, is made under section 332 in Form 105.
How long does registration under section 332 last?
Generally five tax years. Where total income did not exceed five crore rupees in each of the two tax years preceding the application, a ten-year validity is available in specified cases.
Can a Section 8 company be converted into an ordinary company?
Conversion is possible but is a deliberate, scrutinised process requiring surrender of the licence and compliance with the conditions prescribed. Accumulated surplus cannot simply be released to members on conversion, and the accreted income provisions in section 352 of the 2025 Act need to be considered before anyone treats this as an exit route.
How long does incorporation take?
Where documents are complete and no resubmission is raised, a few weeks is typical. Section 8 filings are examined on the merits of the objects and the projections, so timelines are less predictable than for an ordinary private company. Incomplete papers are the main cause of delay.
Talk it through before you commit
Most of the cost of getting this wrong is paid later — in a query from the Registrar, a lapsed registration, or a structure that will not take the funding you had in mind. A conversation first is cheaper than a correction afterwards.