Many people often get confused between society registration, section 8 company registration and trusted company registration. They are not the same.
All three serve different purposes and have different laws, different structure and provide different benefits.
Lets try to understand differences between trusted, Society, and section 8 company registration in India and clear the confusion between them.
What is Section 8 Company Registration?
Section 8 company registration points to legally operate a non-profit organization in India under the company act 2013.
The sole purpose of these companies is to carry out charitable works such as education, art, science, sports, or social welfare, and they do not distribute their profits among members, instead they use them to support these goals.
The Section 8 company under companies act 2013 allow them to exclude “Private Limited” or “Limited” in its name and also these companies get special tax benefits from the government.
Benefits of Section 8 Company
Here are the some key benefits of a Section 8 Company as follows:
- Tax-free status- Section 8 Companies are granted tax benefits and donations made by the donors can be tax-deducted.
- No minimum capital- There is no requirement of a minimum capital to start the company, making it easier for anybody to commence.
- Limited liability- This means the members are liable only to the amount contributed, making their personal assets safe.
- Separate legal identity- The company is an independent legal entity because of which it can own property, enter into contracts, and sue or be sued.
- High credibility- Registration under the Companies Act gives organizations more trust and reputation in the eyes of the public and institutions.
- Easy Fundraising- Section 8 Companies are preferred by donors, NGOs, and government bodies for grants and donations.
- Legal benefits- They enjoy exemptions from some legal provisions, including not needing to use the words “Limited” or “Private Limited” in their name.
What is Society Registration?
When a group of people consider themselves to be social, help the poor, spread knowledge around, do research, or enjoy social activities, and they want to form a legal entity, we call it society registration. This is done in India under the Societies Registration Act, 1860.
A society may be established for friendly purposes such as running a school, hospital, community center, cultural association, or welfare programs.
For the society’s registration, the MoA (Memorandum of Association) and Rules & Regulations must be created by the at least seven founding members.
After the society is registered, it can be recognized as a legal entity, with the power to hold property, receive bank statements, and operate in its name.
Major Benefits of Society Registration
Find below the important benefits of society registration:
- Legal Recognition – Upon registration, a society gets itself clothed with a legal entity which, in its name, can acquire property, open bank accounts, and enter into contracts.
- Limited Liability – The members are generally not held personally liable for the debts of society.
- Tax Exemptions – Registered societies can apply for exemption from taxation as provided under the Income Tax Act (like 12A or 80G).
- Credibility and Trust – The registration boosts public trust, which helps in getting support from donors, government bodies, and other institutions.
- Better Management – A registered society would have to maintain records and abide by the rules, hence upholding transparency and good governance.
- Access to Grants and Funds – Registered societies are entitled to receive government grants as well as foreign donations and grants.
- Perpetual Succession – The society perpetuates its existence even when its members change or resign.
What is Trusted Company Registration?
Trust company registration serves the same meaning as section 8 company registration, both are meant to set up a charity organization or we call it non-profit organization.
But both are different, both have different tax benefits, different laws and different procedures.
You can form a trust company easier and quicker with few formalities and on the other hand a section 8 company requires government approval with strict rules and regular reporting.
But here section 8 company is more transparent as compared to trust because it has a strong legal structure with strict rules.
Trust Company Benefits
Here are some key benefits of trust company registration as follows:
- Legal Personality – A registered trust exists as a legal body that can hold property and manage assets.
- Tax Benefits – Trusts can apply for tax exemptions under such sections of the Income Tax Act like 12A and 80G.
- Protection of Assets – Assets settled into a trust are protected and administered per the terms of the trust deed.
- Ease of Formation – The formation of a trust is relatively easier with fewer formalities involved compared to other entities.
- Charitable Recognition – A registered trust is recognized for its charitable or religious work, hence attracting greater support.
- Perpetual Succession – The trust will still function even if trustees change over a period of time.
- Eligibility for Grants – Registered trusts can accept donations and grants from government and foreign sources.
Conclusion
This blog will deeply explain about, Trust company registration, Section 8 Company registration, Society registration with their benefits on tax, assets, Liability and more. After reading the complete blog you will be able to differentiate between their registration process and government acts.
If you are local from Assam region, Regible Corporate Advisor LLP is the best and trusted company registration agency in Guwahati, advising many people around the world on their legal disputes.
FAQs
Is section 8 company and trust company are same?
No, both companies are not the same, both serve different purposes but are the same entity with different rules and regulations.
What is the difference between society registration and section 8 company?
Section 8 companies are more structured and rule oriented companies while in other hand societies easily get registered with less complexity and are easily managed.
Who is the best company in Assam for society registration?
Regible Corporate Advisor LLP is the best consultancy company for society registration or any types of legal works.
How to register a section 8 company in Guwahati Assam?
There are two ways to either register online through a portal or take help from an advisory company such as Regible Corporate for a smooth process.
How to register my trust in Assam, India?
To register your trust in Assam or Guwahati region simply contact our company or contact us on +91-88226-90951 to get complete information.
