Section 8 Company
Section 8 company is a non-profit organization with a goal to promote activities such as science, sports, education, research, social welfare, religion, and charity. It has become the most popular form of a non-profit organization.
To begin with, the fundamental aim of registering a company is to promote non-profit objectives such as trade, commerce, arts, charity, education, religion, environment protection, social welfare, sports research, etc.
However, to incorporate a Company, a minimum of two directors are required. Also, there is no requirement of minimum paid-up capital in this case.
In India, even though, a non-profit organization can register under the Registrar of societies or as a Non-profit company under the Section8 Company of the Company Act,2013.
The profits of this company, if there are any, are applied towards promoting the objectives of the company and however, not distributed as dividends to its shareholders.
Moreover, a Section 8 Company is the same as a Section 25 Company under the old Companies Act, 1956. Consequently, as per the new Companies Act of 2013, Section 25 has now become Section 8.
There are only 2 structures in which the company can be registered i.e.
- Section 8 of the Companies Act, 2013(section 25, companies act 1956)
- Trust or Society
- Easy to register
- Profit Earning
- Utilization of funds and earnings
Minimum requirements to start a company:
- 2 shareholders
- 2 Directors
- 1 Director should be a resident of India
- No Minimum capital required
- Identity Proof
- Pan card
- 1 Proof of Residence
- Office address proof
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