Section 8 of the companies act will be dealing with the legal entities that are stated as the object of promoting social welfare, charity, art, science, religion, education and several other kinds of activities that are important for the society at large. These kinds of companies are very much synonymous with non-profit organisations and are very much essentially incorporated to perform the objective of the welfare of society.
Section 8 company registration is a very comprehensive process to be undertaken by the organisations in this particular area because they will be having different kinds of applications and legal requirements. Following are some of the very basic advantages of the section 8 company registration in this particular area:
- This particular concept will always help in making sure that organisations will be able to enjoy the tax exemptions from different kinds of laws and specifically to the donors who will be contributing to such companies. All the donors who are contributing to the companies can also claim the right kind of exemption against the donation made to section 8 companies.
- There will be no prescribed limit over section 8 companies and the minimum capital requirement will also be dealt with very easily without any kind of problem. The capital structure of such companies can be easily altered at any stage required for the growth of the company.
- There will be no chance of any kind of stamp duty payable in the whole process because such companies are exempted from the payment of stamp duty applicable for registration as well as application of other structures in the whole process very easily.
- The companies under section 8 will also be very much capable of holding their identity like any other kind of company structure and will also be having a separate legal standing in the industry from the members. Hence, such companies will be able to enjoy the element of perpetual existence at all times without any kind of problem.
- All the companies which are registered in section 8 will be having more credibility in comparison to any other kind of non-profit organisation structure for example trust or society.
- All these kinds of companies are perfectly licensed by the central government and will be having stringent regulations with the help of articles of association and memorandum of association in the whole process. So, all these kinds of compliances are considered to be the best way of having a reliable image in the whole process associated with illegal structures.
- Unlike the names of companies of Private Limited and public limited companies, there will be no need for any kind of title under section 8 companies and there will be no need of using any kind of suffix next to its name.
Hence, being clear about all the above-mentioned formalities associated with the register section 8 company is important so that everyone can avail the right kind of advantages of the whole process associated with the credibility and trust factor in the whole process.