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Section 8 Company Compliance

Section 8 companies are established for promoting commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object, with the intention of applying its profits, if any, or other income in promoting its objects. Unlike other companies, they operate with a non-profit motive, but they are still required to adhere to stringent annual compliance requirements under the Companies Act, 2013, to maintain their special status and public trust.

A Section 8 Company in India is a Non-Profit Organization (NPO) established under Section 8 of the Companies Act, 2013, with the primary objective of promoting commerce, art, science, sports, education, research, social welfare, religion, charity, protection of the environment, or any other useful object. Unlike other companies,

Laams Tax Consultancy offers specialized MCA Compliance Services in Chennai tailored for Section 8 companies . We understand the unique regulatory framework governing these entities and provide expert guidance and support to ensure all secretarial and financial compliances are met efficiently, allowing them to focus on their noble objectives.

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Mandatory Documents

Registration Process

Benefits

Common Mistakes

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Requirements and Eligibility

Compliance with Companies Act, 2013

Section 8 companies, despite their non-profit nature, are governed by the Companies Act, 2013 , and must comply with all applicable provisions, including annual filings.

Adherence to Objects

The company must strictly adhere to its stated objects as per its Memorandum of Association and ensure that no part of its income or property is distributed as dividend to its members.

Maintenance of Books of Accounts

Detailed and accurate financial records must be maintained, which are subject to audit, reflecting the company's non-profit operations.

Documents Required for Section 8 Company Compliance in Chennai

1. Audited Financial Statements

Section 8 Companies must prepare and file audited financial statements annually, including the Balance Sheet, Profit & Loss Account (or Income & Expenditure Statement), Cash Flow Statement, and Auditor's Report. These documents help validate the company’s non-profit activities and proper fund utilization. They must be signed by the Board and certified by a registered auditor.

2. Board Reports and Annual Return

The Director’s Report and Annual Return ( Form MGT-7 or MGT-7A for small companies) are essential for corporate transparency and governance. These reports outline the company’s operations, key decisions, changes in directors or members, and future goals. Filing them ensures ROC compliance and legal recognition of the company’s activities.

3. Certificates and Declarations

Section 8 Companies must submit declarations that confirm income is applied solely for charitable purposes and profits are not distributed among members. These declarations uphold the non-profit status and charitable intent of the organization. They must be duly signed by directors and submitted with the annual filings for regulatory approval.

Process or Compliance Filing Online in Chennai

step 1: Conduct of Regular Board Meetings

We assist in scheduling and documenting board meetings at prescribed intervals in accordance with the Companies Act, 2013. These meetings ensure approval of financials, plans, and compliance-related decisions, maintaining governance standards for Section 8 companies.

step 2: Statutory Audit by Chartered Accountant

As per law, a qualified Chartered Accountant must audit the company’s financial statements. We coordinate the audit to ensure compliance with accounting standards, the non-profit mandate, and accurate representation of income and expenditure.

step 3: Filing Form AOC-4 (Financial Statements)

After the Annual General Meeting (AGM), we file Form AOC-4 with the Registrar of Companies (ROC) within 30 days, submitting the audited financial statements, Board’s Report, and other required documents.

step 4: Filing Form MGT-7 or MGT-7A (Annual Return)

We prepare and file Form MGT-7 (for larger companies) or MGT-7A (for small companies) within 60 days of the AGM. This form contains key information about the company’s directors, shareholding (if applicable), and governance structure.

step 5: Annual Income Tax Return Filing

We ensure your Income Tax Return Filing is filed correctly with applicable exemptions claimed under Section 11 and 12 of the Income Tax Act. Proper documentation of charitable activities and receipts is maintained to support exemption claims.

Benefits of Section 8 Company Compliance in Chennai

Retention of Special Status: Ensures the company retains its special "non-profit" status and benefits like tax exemptions.

Public Trust and Credibility: Demonstrates transparency and accountability, crucial for maintaining public trust and attracting donations/grants.

Avoidance of Penalties: Prevents penalties, revocation of license, and legal action due to non-compliance.

Common Mistakes or Compliance Penalties

Diversion of Funds: Using funds for purposes other than the stated charitable objects.

Non-filing/Late Filing: Missing statutory due dates for annual returns and financial statements.

Non-compliance with MOA/AOA: Operating outside the scope defined in the Memorandum and Articles of Association.

Why Choose Laams Tax Consultancy for Section 8 Company Compliance

Laams Tax Consultancy offers expert Top Secretarial Compliance Services for Section 8 companies, ensuring adherence to their unique regulatory landscape. Our team provides comprehensive support, from meticulous documentation to timely filing, allowing your organization to focus on its mission without compliance worries.

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