Section 8 Company Compliance

A Section 8 business is a specific kind of NGO registered organization according to the Companies Act, 2013. Every Section 8 company is required by law to abide by the compliance requirements set forth by the Income Tax Authorities and the Registrar of Companies (RoC). They could face severe fines of up to Rs 1 lakh each year if they don't comply with the rules. Additionally, such businesses and directors might be put on a temporary blacklist.

A Section 8 corporation is established with the aim of advancing the nation's social welfare, scientific advancement, and environmental protection. Members cannot be informed of their ability to conduct business and generate revenue that can be applied to the goals.

Appointment of an auditor within 30 days after incorporation, Instant Compliance

Within 30 days of the firm's incorporation, a Section 8 business must finish the initial auditor appointment process. As a result, the company's annual financial reports can be completed appropriately.

Within 30 days, organize the board of directors' meeting

It is required to schedule the first Board of Directors meeting within 30 days of the company's incorporation. Following that, the Board of Directors must hold at least one meeting every six months.

Annual Meeting of the Whole

Within nine months following the end of the business's first fiscal year, the first annual general meeting of a Section 8 company must be held.

Form ADT-1 -
Notice is to be issued followed by the appointment of Auditor within 15 days of when he is appointed.

Form DIR 2 –
Consent Form of 2 Directors certifies that they have held their positions for no longer than 30 days following their appointment.

Form MR-1 –
This document contains returns for appointments of managing directors who serve as the manager or chief management person within 60 days of the appointment.

Form AOC-3 -
Before 30 days after the date of the meeting, a Photocopy of the Audited Financial Statement must be sent to the company's members.

Form MGT–15 –
Within 30 days of the Annual General Meeting, a report on it must be submitted.

A Section 8 firm must file Form AOC- 3 & 4 –
Photocopy of the Financial Statements, Accepted in Annual General Meeting — within 30 days of the meeting. Within 30 days following the conclusion of the meeting, the MoM or minutes shall be documented.

Form MGT-7 -
Within 60 days of the annual general meeting, Section 8 firms are required to file their annual returns.

With the help of our robust, cutting-edge technology, Click 4 Business Solutions Private Limited meets all of the regulatory requirements for a Section 8 corporation. To maintain smooth communication between our clients and the authorities, we have a thriving team that creates essential documents. At our organization, we completely disclose every step of the procedure to set reasonable expectations. Our team of highly qualified experts is here to answer any questions you may have regarding the tax and compliance requirements for Section 8 Companies

There is no need for an independent director

No minimum paid-up share requirement must be met, and the employment of a company secretary is not required

Administration under Section 8 Company is not taken into consideration for the maximum number of Directorships

Nomination & Remuneration Committee and Stakeholder Relationship Committee are not necessary

There is no restriction on the number of directors

Non-compliance may lead to a penalty with a fine of Rs.25,000 to Rs.5,00,000 and/or imprisonment.

According to the Income Tax Act's recommendations, a Section 8 corporation must pay corporate tax. However, it can assert that certain income should be disregarded when determining the total income subject to income tax. For requesting an exemption, the following compliances must be submitted:

Section 12A of the Income Tax Act requires Section 8 corporations to register with the Principal Commissioner by submitting Form 10A.

In order to be eligible for this exemption, it must adhere to the requirements listed in Section 11

The business must submit Form 10B in order to receive Section 80G approval

With the help of our knowledgeable staff and potent, cutting-edge technology, Click 4 Business Solutions Private Limited meets all of the regulatory requirements for a Section 8 corporation. To maintain smooth communication between our clients and the authorities, we have a thriving team that creates essential documents. At our organization, we completely disclose every step of the procedure to set reasonable expectations. We have a group of extremely knowledgeable consultants who can answer any questions you may have regarding Section 8 Company tax and compliance procedures.

Ques: Is it possible to change a Section 8 corporation into another type of business?

Yes, Section 8 Company must function according to the rules established by the Ministry of Corporate Affairs.

Ques: Do Section 8 Companies qualify for full tax exemption?

Yes, it is possible to claim total exemption by meeting the requirements outlined by the relevant sections under the Income Tax Act.

Ques: Can a Section 8 corporation issue shares or debentures?

As a company limited by shares or as an entity with or without share capital, Section 8 Company may be registered. A Section 8 business is not permitted to provide dividends to its members, regardless of the firm's structure.

Ques: What is the consequence of failing to employ an auditor within the suggested timeframe?

If an auditor cannot be hired, it is illegal and punishable by a fine starting at Rs. 25,000 and going up to Rs. 5,00,000.

Ques: What is the punishment for failing to file a director's consent form with the registrar of companies?

Failure to file the Director's Consent Form is punishable by a fine of up to Rs 50,000 or by up to six months in jail.

Ques: What is a Section 8 Company?

Do you require assistance with section 8 company registration or NGO registration? Click 4 Business Solutions Pvt Ltd Private Limited provides assistance to its customers with various business setups, registrations, tax filings, etc. To solve the legal needs of various enterprises, we have a team of qualified professionals. They can help young entrepreneurs build up their businesses and are knowledgeable about section 8 company registration.