9559179325 9559179325 Login
A Complete Guide on NGO Registration in India - BizAdvisors

Learning

A Complete Guide on NGO Registration in India

A complete guide on NGO registration in India

A non-governmental organization (NGO) is an organization dedicated to philanthropic causes. NGO registration in India is mandatory. An NGO is a non-profit organization dedicated to the advancement of the arts, science, sports, education, research, social welfare, religion, charity, and other causes. In India, there are several different forms of NGOs that are registered under the Trust Act, the Society Registrations Act, and the Companies Act. Under the Companies Act of 2013, the NGO is registered as a Section 8 Company. All not-for-profit and charity trusts are required to register under this statute. The main distinction between a trust or society and a non-governmental organization (NGO) is that the latter is registered with the Ministry of Corporate Affairs (MCA). 

Pre-requisites of NGO registration in India

One must follow the following two things before registering as NGO- 

Obtaining a digital signature certificate 

The proposed directors must supply digital signatures since the NGO registration in India paperwork must be digitally signed before being filed online. Digital Signature Certificates are issued by certifying bodies within the Government of India (DSC). Applicants must obtain a DSC in either the Class 2 or Class 3 category. The cost of getting a DSC varies and is determined by the certifying organization.

Apply for a director identification number 

For each of the potential company directors, applicants must apply for a DIN. Form DIR-3 is used to help assign a DIN number to a product. Scanned papers such as self-attested copies of PAN, identity, and directors’ address proof must be sent together with the application form. You can fill out and submit an application form online through the Ministry of Corporate Affairs (MCA) website. Attestation of the papers is required from a practising chartered accountant, company secretary, or cost accountant.

Procedure to register as NGO 

Few steps shall be followed before NGO registration in India:

Step 1: The applicant must receive a DSC from the prospective NGO’s Directors. After obtaining a DSC, submit Form DIR-3 to the ROC to receive a DIN. 

Step 2: Following DIR-3 approval, the ROC will assign a DIN to the nominated directors.

Step 3: The applicant must then submit Form INC-1 to the ROC in order to apply for a business name. A preference list of six names can be submitted, from which ROC will choose one based on availability.

 Step 4: After receiving clearance from the ROC, submit Form INC-12 to apply for an NGO license.

Step 5 – The NGO license will be granted in Form INC-16 when the Form has been approved. 

Step 6 – After receiving the NGO license, the applicant must file SPICE Form 32 with the ROC for incorporation. The ROC issues a Certificate of Incorporation with a unique Corporate Identification Number after checking and verifying the paperwork (CIN).

Eligibility to start a Non-Profit Organization

  • If the NGO is to be formed as a private limited company, it must have at least two directors.
  • When forming a public limited company, a minimum of three directors is necessary.
  • In the case of a private limited business, the maximum number of members is 200.
  • In the case of a public limited corporation, there is no limit on the number of members.
  • NGO registration in India is FREE of cost.

Forms Required for NGO Registration in India

  • Appointments of Directors
  • Consent of Directors Application to ROC to get DIN
  • Business name approval
  • Applications for License Memorandum of Association
  • Declaration from a practicing CA
  • Declaration from each person making the application
  • License to incorporate as NGO
  • The situation of the Registered Office
  • Applications for Company’s Incorporation
  • Declarations
  • Affidavit from each director and subscriber

Advantages of NGO registration in India 

There are lot of benefits of registering as NGO, some of them are given below- 

Savings on taxes

By registering your company as a non-profit organization (NGO) under the Companies Act of 2013[1], you may take advantage of many tax benefits for the firm’s directors. NGOs are free from a variety of taxes, which allows the corporation to save money on taxes and invest it in new projects.

Share Capital is Reduced

To operate freely, all businesses require a minimum share capital. This is not the case with NGOs, because they may be directly sponsored through donations. Subscriptions may also be used to fund the company’s legal activities. As a result, NGOs do not require a larger percentage of cash to operate autonomously.

Use of the Title

The majority of companies are required to indicate whether or not they have limited liability. This rule does not apply to companies incorporated under the Companies Act. Certain registered firms are forbidden from using titles. They are able to function without exposing their limited liability status to the public, saving the company money on capital.

Transfer of title/ownership

Companies that are classified as non-profit organizations (NGOs) under the Income Tax Return Act of 1961 are not limited in their ability to transfer ownership or claims to earned interest. Other businesses, on the other hand, are unable to transfer ownership as easily, which helps NGO-registered businesses.

Exemption from Stamp Duty

All firms that are registered as NGOs under the Income Tax Act of 2013 are free from stamp duty, allowing the company to save money on taxes. All of the taxes saved by avoiding stamp duty are then used to promote the company’s new slogan. Exemption from stamp duty safeguards finances for the firm, allowing it to operate more smoothly and increase production.

Conclusion 

NGO registration in India is rapidly growing. Apart from its philanthropic status, NGOs also attract lots of other advantages, as we have discussed above. It is mandatory to register NGOs if you want to take advantage. Consult with an expert for NGO registration in India. You can reach an expert like bizadvisor.io for NGO registration in India.

Read our article:Detailed Comparison Between NGO And Society

Post Views:

162

Related Posts

Leave a Reply

Get Expert Assistance


Subscribe Our Newsletter.

We'll never share your email with anyone else.