NGOs are non-profit organizations that are independent of the government. However, they may be funded by government and international government organizations.
Nowadays, people have knowledge and awareness about non-government organizations. You would also enquire about the many forms of non-governmental organizations that might be recognized in India. Once you have made your decision, check to see if it meets your requirements. If this is the case, complete the NGO registration process and then proceed with your strategy. You should know about several sorts of NGOs and their benefits.
What is the Objective of Registering a Non-profit Organization?
It makes no difference what type of NGO you are running or planning to start. Regardless of the industry in which you operate, you must have the ultimate objective and intrinsic desire to serve and support others, whether in education, art, skill development, or any other field. You must also mention the recipient, the broader public, or a specific group of people. If you want to help individuals and serve society, the best method is to register as a non-profit organization.
NGOs aim to support the underprivileged primarily and also aim at creating awareness of things that are often ignored in our society. NGOs are active in education, public policy, health care, human rights, and other areas based on their objectives. The following are some of the motivations for forming a society in India:
- They are self-governing bodies that seek to work for the betterment of society by helping the poor and needy;
- The primary goal of an NGO is to assist underprivileged people and allow them to grow.
What is NGO Registration?
A non-governmental organization (NGO) is a nonprofit group that strives to better society as a whole. It can be set up as a Trust, a Non-Profit Company (Section 8 Company), or a Society, depending on the purpose. All non-profit groups in India, such as Trusts, Societies, and Section 8 Companies, are referred to as NGOs. All NGOs and NPOs qualify for income tax exemption.
Non-governmental organizations, or NGOs, are non-profit organizations that are not affiliated with any government. Governments and international government organizations frequently subsidize them. The main goal should be to help those who are less fortunate.
Apart from that, the NGO tries to raise awareness about many issues rarely discussed in society and are frequently overlooked. NGOs work to affect change in various sectors, including education, public policy, social, humanitarian, health care, human rights, the environment, and others.
Different Laws Apply to the Registration of NGO
Several regulations govern NGO registration. In India, three governing acts can be used to register non-governmental organizations:
For trust registration, there is the Indian Trusts Act of 1882; for society registration, there is the Societies Registration Act of 1860; and for Section 8 company registration, there is the Companies Act of 2013.
How to Register an NGO in India?
- Proper Entity Selection – We answer all of your questions about entity selection and assist you in making the best decision.
- Online Paperwork – With the least amount of effort on your part, we assist you in completing the entire paperwork, filing, and registration process.
- Registration – We will complete all post-compliance procedures and register the NGO.
Benefits of NGO Registration in India
- Holding property
- Transfers of ownership
- Maintaining brand recognition
- Protection from personal responsibility
- Profit from a tax exemption
Different Types of NGO Registration in India
As we have discussed above, 3 laws regulate the functioning of the NGO registration process; similarly, there are 3 types of NGO registration. They are as follows:
- Trust Registration;
- Society Registration;
- Section 8 Company.
1) Trust Registration
The registration for trust can be completed via the Indian Trust Act, of 1882. These are usually formed when the land or property is involved in public charitable trusts. Typically, the usage of faith is for the relief of medical aid, education, poverty, etc.
Benefits of Trust Registration
- Trusts can get land from the Government Agencies
- In a maximum of the states, there’s no law that governs Public Charitable Trusts in India. However, many states such as Madhya Pradesh, Maharashtra, Gujarat, and Rajasthan do have Public Trusts Act.
- An NGO registered under the Trusts Act can practice the word “Govt. Regd.” or ‘Regd.’
- They get quite a few tax benefits such as Income Tax, etc
- 80G certificate advantage under the Income Tax Act
- Trust can get White capital for Building construction.
- Benefits in Entertainment Tax and Service Tax, etc
2) Society Registration
An additional way in which you can register NGO is in the system of society. As stated in Section 30 of the Society Registration Act of 1860, the individual comes together to promote scientific purpose, charitable purpose, and various other objectives to form a society.
Benefits under Society Registration
NGOs registering under the Society Registration Act, of 1860 can avail of the following benefits:-
- Exemption from income tax: Society registration is a kind of NGO registration where the firm is saved from paying income taxes, and Income Tax exemption is something everybody desperately seeks for.
- Separate legal identity: NGO is a separate legal entity in the eyes of the law, which is one of the significant advantages that come with society registration. Each member of this society is accountable for their actions only. The members of such NGOs are responsible only for the activity undertaken by them and not by other members because of the distinction given.
- Limited Liability: Society NGO is a separate legal entity from its members. Thus the liability of the members is limited to their share only. That means, in no circumstances, the members’ assets cannot be utilized to pay the firm’s liabilities. Since society NGOs are a separate legal identity, members’ responsibility is limited to their share only.
- Legal protection: You will be provided with legal protection, once you have registered your society under the Society Registration Act, of 1860. It indicates that no other company or people can use your company name, your assets, etc. Anybody would be subject to punishment if found liable for any violation.
3) Section 8 Company Registration
The third method to register an NGO is by Section 8 of the Indian Companies Act, 2013. These companies are recognized to protect trade, religion, charity, etc. Nevertheless, the earnings of this company are used by the company for promotion work, not used by the shareholders. You can register the company as a private limited company (needs two directors) and a public limited company (requires three directors).
Benefits of Section 8 Company Registration
NGOs registering themselves under Section 8 company registration can gain various advantages from it.
Those are as follows:-
- No minimum capital requirement: There is no minimum capital requirement for creating NGO as per section 8 company. Unlike other existences such as public limited companies, section 8 companies have no prescribed limit for any minimum capital necessities. However, the capital structure of the firm can be modified at any stage, which may be needed for the growth of the business.
- Separate legal entity: Comparable to the trust, a Section 8 company also gets the special recognition of a ‘separate legal entity.’ Like Private Limited and other limited companies, a Section 8 company, too, continues its own identity and possesses its separate legal entity from its members. Furthermore, Section 8 Company has continued survival.
- Tax exemption: One of the advantages that every NGO receives is the benefit of tax. Aside from the stakeholders, the NGOs’ contributors can also receive tax exemption for the donation given to the NGO. It’s one of the most significant advantages that NGOs registering under Section 8 Companies are presented with, especially those subscribing to section 8 companies. Even the contributors can claim the tax exemption upon the donation made to this pattern of NGO.
Forming an NGO (Non-Governmental Organization) in India is a simple procedure if all of the necessary documentation and papers are in order. The preceding information describes the various kinds of NGO registration accessible in India, as well as the benefits of establishing one. As a result, the documentation requirements may vary based on the types of NGOs you wish to register with.
FAQs on NGO Registration
It is best to apply based on the type of work you have to do. For the best guidance, contact one of our well-skilled experts for a better understanding to choose which registration procedure suits your NGO Company the best.
If you are willing to commence an NGO, you have other choices also through which you can help locality or society, such as starting a club, a volunteer service, be part an operating NGO and even be a financial sponsor.
An NGO is eligible for Government funding only after its three years of working.
CSR is nothing but ’’Corporate Social Responsibility” which are voluntary Social activities to be done by an entity to operate in a social, economic and environmentally sustainable way.
There is a special provision in which if a donor donates funds to those NGOs having 35ac registration, they obtain 100% tax rebate.
Yes. According to 'rule 8(7) of the Companies (Incorporation) Rules, 2014', for the Companies under 'Area 8 of the Act', the name ought to incorporate the establishment of the word like and so forth. If a Section 8 Company, which is associated with CSR ventures likewise needed to compulsorily
Yes, one individual organization may change itself into a private/public organization, and afterwards, recovery of such private/public association into Section 8 is reasonable.
A trust generally includes three parties – a settlor or the creator of the trust, a trustee of the trust and a recipient of the trust. A trust gets commenced when the settlor or the creator transfers any property to the trustee to be utilized and which can be utilized to serve the recipient of the trust.
Yes, a government employee can become a trustee in a trust.
No, members of the society are not ennobled to use profit incurred by the organisation in any means.