NGO Registration Online India

NGO Registration: Overview

NGO registration is a vital step for nonprofit organizations in India, enabling them to provide public services often supported by government, corporations, individuals, or groups. As a nongovernmental organization, complying with regulations is essential while serving the community.

An NGO, or non-governmental organization, aims to enhance society through charitable activities. Depending on your goals, you can establish it as a Trust, Society, or Non-Profit Company (Section 8 Company).

In India, all non-profit entities, including Trusts, Societies, and Section 8 Companies, are considered NGOs. These organizations, also known as 'Sangathan', 'Sangh', or 'Sangam', benefit from income tax exemptions.

It’s important not to confuse NGOs with non-profitable businesses, which are regular companies not making a profit. At Taxtrix, we guide you in choosing the right structure and assist you throughout the entire NGO registration process.

Types of NGO Registration in India

There are three main types of NGOs widely registered in India:

1. Trust

A Trust is a form of non-profit organization (NPO) created to provide assistance and support to specific causes, such as education, healthcare, and community development. Trust registration is governed by the Indian Trusts Act, 1882. The process involves legally establishing a trust deed and is typically managed by legal experts and professionals.

2. Society

A Society is formed under the Societies Registration Act, 1860. It consists of a group of individuals who come together to achieve a common goal or objective. Societies are usually established to promote charitable, religious, educational, scientific, literary, or social causes. The registration process involves drafting a memorandum of association and rules and regulations for the society.

3. Section 8 Company

A Section 8 Company is a type of non-profit organization registered under Section 8 of the Companies Act, 2013. It aims to promote commerce, art, science, religion, charity, or any other useful objective without the intention of making a profit. This type of company is also known as a Non-Profit Organization or Non-Governmental Organization (NGO). The registration process includes obtaining a license from the Registrar of Companies and adhering to specific compliance requirements.

Difference Between - Trust, Society & Section 8 Company

Criteria	Trust	Society	Section 8 Company
Legal Framework	Indian Trusts Act, 1882	Societies Registration Act, 1860	Companies Act, 2013
Main Objective	Charitable purposes	Public welfare activities	Promotion of commerce, arts, science, etc.
Membership	Trustees	Members	Shareholders
Governing Body	Board of Trustees	Governing Council	Board of Directors
Governing Rules	Trust Deed	Memorandum and By-laws	Memorandum and Articles of Association
Registration	Registrar of Trusts in local jurisdiction	Registrar of Societies in the state	Registrar of Companies (ROC)
Tax Exemption	Section 12A and 80G of the Income Tax Act, 1961	Section 12A and 80G of the Income Tax Act, 1961	Section 8(1) and 12A of the Income Tax Act, 1961

Classification of NGOs in India

NGOs in India can be classified based on their orientation and level of operation. Here are the key classifications:

By the Level of Orientation

1. Charitable Orientation: These NGOs focus on providing direct aid to those in need, such as food, clothing, and shelter.
2. Service Orientation: These NGOs provide services such as healthcare, education, and family planning.
3. Participatory Orientation: These NGOs involve the people they serve in the design and implementation of their programs.
4. Empowering Orientation: These NGOs aim to empower the community by promoting self-help and capacity building.

By the Level of Operation

1. Community-Based Organisation: These NGOs work at the grassroots level, addressing local community issues.
2. City Wide Organisation: These NGOs operate within a city and focus on urban development issues.
3. National NGOs: These NGOs operate across multiple states or the entire country, addressing national-level issues.
4. International NGOs: These NGOs operate in multiple countries, focusing on global issues such as human rights, environmental conservation, and international development.

Understanding these classifications helps in identifying the type of NGO that best suits your mission and the scope of your activities.

Why Is NGO Registration Required?

1. Credibility and Authenticity
• NGO registration lends credibility to the organization, making it more trustworthy to potential donors and contributors. Registered NGOs are often perceived as more legitimate and reliable, encouraging more people to affiliate with and support them.
2. Growth and Development
• Registration as an NGO can help local organizations expand their operations by ensuring greater exposure and recognition. This increased visibility can attract more financial and human resources, aiding in the development and effectiveness of the NGO’s activities.
3. Enhanced Resources
• Registered NGOs have access to a wider range of both financial and human resources. More volunteers are likely to step forward to support an officially recognized organization, and funding opportunities from various sources become more accessible.
4. Tax Benefits
• Registering your organization as an NGO in India under the Companies Act of 2013 provides significant tax benefits. NGOs are exempt from several taxes, allowing them to save money that can be reinvested in their projects and initiatives.
5. Legal Protections
• Companies recognized as NGOs under the ITR filing return act of 1961 are allowed to sell their assets or earn interest on their claims without prohibition. This flexibility is crucial for financial management and sustainability.
6. Stamp Duty Exemption
• NGOs registered under the Companies Act of 2013 are exempt from stamp duty. This exemption further reduces the tax burden on the organization, allowing it to allocate more resources towards its mission and activities.

By registering as an NGO, your organization can benefit from increased credibility, access to greater resources, tax exemptions, and legal protections, all of which are essential for sustainable growth and impactful operations.

Benefits of NGO Registration

Legal Status and Accountability

• A registered NGO gains legal status and becomes accountable for the funds received. Donations are made under the organization's name and used for its activities, ensuring transparency and proper utilization of funds. In contrast, unregistered firms can receive assets under any individual's name, potentially leading to misuse.

Reinforcement of Ethical and Legal Norms

• Registering an NGO strengthens the ethical, social, and legal norms of society. It reinforces the organization's commitment to its mission and builds trust among the public and donors.

Requirement for Bank Account

• To open a bank account under the NGO's name, it must be registered as a Trust, Society, or Section 8 Company. This is a basic requirement for operating legally and managing finances transparently.

Tax Exemption

• Registered NGOs can seek tax exemptions from the Income Tax Authority, reducing their tax burden and enabling them to invest more in their initiatives.

Advantages of NGO Registration

Tax Exemption Benefits

• NGOs are exempt from several taxes, allowing them to save money that can be reinvested into their projects. Registering under the Companies Act, 2013, enables NGOs to take advantage of these tax benefits.

Ability to Purchase Assets

• Legal registration allows NGOs to purchase real estate, retain fixed assets, and incur liabilities. Unregistered organizations are prohibited from these activities.

No Minimum Share Capital Required

• NGOs can operate without a minimum share capital. Donations can directly fund the NGO, showing that substantial funds are not necessary to function effectively.

Protection Against Personal Liability

• Assets and stakes can be acquired under the NGO's name, protecting individuals from personal liability in events such as divorce, foreclosure, or bankruptcy.

Ownership Transfer

• NGOs registered under the Companies Act of 2013 can transfer ownership or rights to interest accrued under the Income Tax Act of 1961.

Corporate Entity Benefits

• As a corporate entity, an NGO can improve its interactions and transactions with the community. It can also bring or face legal action, protecting its interests.

Stamp Duty Exemption

• Section 8 companies are exempt from stamp duty, further reducing their tax burden. The savings can be used to further the NGO's objectives.

Structured Financial Plan

• Registered NGOs can operate tax-free, allowing for a structured financial plan that supports their activities without the burden of taxes.

Stability and Perpetual Succession

• Registration indicates capable and accountable leadership, promoting stability. NGOs can exist perpetually, continuing their mission even if founders or trustees change.

Access to Credit

• Registered NGOs can obtain loans from financial institutions, aiding in the purchase of land, fixed assets, and supporting operations. Registration documents are required for loan approval.

Name Preservation

• Once registered, no one else in India can use the same or a confusingly similar name, protecting the NGO's brand and reputation.

Opening a Bank Account

• Having a bank account in the NGO's name demonstrates transparency and legality, making it easier to receive donations and support from various stakeholders. Proof of registration is required to open a bank account.

By registering your NGO, you gain these benefits, enhancing the organization's credibility, operational efficiency, and ability to fulfill its mission.

Who is Eligible to Start an NGO?

Private Limited Company

• Minimum Directors: To incorporate an NGO as a private limited company, you need at least two directors.
• Maximum Members: A private limited company can have a maximum of 200 members.

Public Limited Company

• Minimum Directors: Incorporating an NGO as a public limited company requires a minimum of three directors.
• No Member Limit: There is no limit on the number of members for a public limited company.

General Eligibility

• No Registration Fee: There is no fee required for registering an NGO.

Starting an NGO can be tailored to fit different organizational structures, whether it's a private limited company or a public limited company. Ensure you meet the necessary requirements for directors and members to proceed with your NGO registration.

Things to Do Before Applying for NGO Registration Online

Obtain a Certificate for a Digital Signature (DSC)

• Requirement: The registration forms must be digitally signed before being submitted online. Therefore, proposed directors need to provide digital signatures.
• Certification: Digital Signature Certificates (DSC) are issued by government-certified organizations in India.
• Class Types: Candidates must obtain a DSC in either the Class 2 or Class 3 category.
• Cost: The cost of obtaining a DSC varies and is determined by the certifying organization.

Apply for a Director Identification Number (DIN)

• Requirement: Applications must include requests for a Director Identification Number (DIN) for any potential company directors.
• Application Form: The allocation of a DIN is facilitated by completing Form DIR-3.
• Supporting Documents: The application form must be accompanied by scanned copies of director identification, address proof, self-attested copies of PAN, and other supporting documentation.
• Submission: The application form can be submitted online.

Online NGO Registration Forms

Here are the NGO registration forms required:

• DIR 12: Appointments of Directors
• DIR 2: Consent of Directors
• DIR 3: Application to ROC to get DIN
• INC 1: Business name approval
• INC 12: Applications for License
• INC 13: Memorandum of Association
• INC 14: Declaration from a practicing CA
• INC 15: Declaration from each person making the application
• INC 16: License to incorporate as NGO
• INC 22: Situation of Registered Office
• INC 7: Applications for Company’s Incorporation
• INC 8: Declarations
• INC 9: Affidavit from each director and subscriber

NGO Registration Procedure

Follow these steps to register an NGO:

Step 1: Determine the Type of NGO

Choose the appropriate type of NGO structure, such as a trust, society, or section 8 company, based on the organization's objectives and activities.

Step 2: Select a Unique Name

Select a distinctive name for the NGO that represents its mission and purpose and is not similar to any existing registered entities.

Step 3: Prepare the Memorandum of Association (MoA) and Articles of Association (AoA)

Draft the MoA and AoA, which outline the objectives, rules, and regulations governing the NGO's operations and management.

Step 4: Formulate the Governing Body

Establish a governing body or managing committee comprising individuals who will oversee the NGO's functioning and decision-making processes.

Step 5: Provide a Registered Office Address

Designate a registered office address for the NGO, where official communications and legal documents can be sent.

Step 6: Prepare the Required Documentation

Gather the necessary documents, including identity proofs, address proofs, and photographs of the governing body members.

Step 7: File the Registration Application

Submit the registration application, along with the required documents, to the appropriate authority such as the Registrar of Societies, Registrar of Trusts, or Registrar of Companies, depending on the chosen NGO structure.

Step 8: Review and Approval

The registration authority will review the application and supporting documents. They may seek additional information or clarification, if necessary.

Step 9: Obtain the Registration Certificate

Upon successful review and approval, the registration authority will issue a registration certificate, confirming the legal status of the NGO.

Step 10: Apply for Tax Exemptions

After obtaining the registration certificate, apply for tax exemptions under the Income Tax Act by obtaining certifications such as 12A and 80G.

Step 11: Ensure Compliance and Reporting

Adhere to ongoing statutory requirements, including maintaining proper accounts, filing annual returns, and submitting audited financial statements.

Process of NGO Registration in India

In India, anyone is free to engage in social activities without forming an association or organization. However, when an individual wants to create a group that involves volunteers, activities, and resources, it becomes essential to have proper management in place. To run such organizations, whether they are companies, trusts, or societies, in an appropriate manner, a certain set of rules need to be followed.

How to Raise Funds for NGOs

Raising funds for an NGO can be approached in several effective ways:

• Crowdfunding: This strategy involves gathering small contributions from a large number of people, typically through online crowdfunding platforms. It allows NGOs to reach a wide audience and gather support from people who are passionate about their cause.
• Applying for Grants: NGOs can seek grants from various sources such as government agencies, private foundations, and international organizations that support social causes. These grants can provide substantial funding for projects and initiatives.
• Corporate Partnerships: Forming partnerships with companies that share similar values can lead to sponsorships and donations. Corporations often look to support social causes as part of their corporate social responsibility (CSR) initiatives.
• Organizing Fundraising Events: Hosting events such as charity walks, concerts, auctions, or online campaigns like Giving Tuesday can draw attention and attract donors. These events not only raise funds but also increase awareness about the NGO’s mission.
• Direct Appeals: Reaching out to individuals through online donation portals or direct approaches can be effective. Personalized appeals, highlighting the impact of their contribution, can motivate potential donors to support the cause.
• Leveraging Social Media: Using social media platforms like Facebook, Instagram, Twitter, and LinkedIn, NGOs can engage with potential donors, share their stories, and create a community around their cause. Social media campaigns can significantly boost visibility and attract donations.

Documents Required for NGO Registration

Before a registered deed is issued to an NGO, specific documents must be submitted.

Trust Registration

For trust registration, the following documents are mandatory:

• An electricity or water bill indicating the address that needs to be registered.
• The identity proof of at least two members of the company. The proof can be Voter ID
• Passport
• Aadhaar Card

Once the payment for the registration is made, it takes about 8 to 10 days for the online registration to be completed under the Indian Trust Act of 1882. Before the deed becomes valid nationwide, the settler must present it at the registrar’s office.

Note: On the scheduled date for registration, the Author of the Trust must be present at the Registrar's Office for the registration process.

Section 8 Company Registration

For a Section 8 company registration, the following documents are essential:

• Company Name Approval: The proposed name of the company must be approved.
• Office Address Proof: Proof of the office address, which can be an electricity or water bill, or a house tax receipt.
• Identity Proof of All Directors: Acceptable identity proofs include:
  • Driving License
  • Copy of Passport
  • Voter ID
  • Aadhaar Card
• Memorandum of Association (MoA) and Articles of Association (AoA): These documents outline the company's objectives and regulations.

Note: Once the registration payment is made, it takes about 8 to 10 days to draft the MoA and AoA. The complete registration process for the company takes approximately 2 months.

Section 8 Company Registration

For a Section 8 company registration, the following documents are essential:

• Company Name Approval: The name of the company for approval.
• Office Address Proof: This can be an electricity or water bill, or a house tax receipt.
• Identity Proof of All Directors: Acceptable identity proofs include:
  • Driving License
  • Copy of Passport
  • Voter ID
  • Aadhaar Card
• Memorandum of Association (MoA) and Articles of Association (AoA): The constitutional documents of the company.

Note: Once the payment for the registration is made, it takes about 8 to 10 days for drafting the MoA and AoA. Thereafter, it takes about 2 months for the entire company registration to be completed.

How Long Does It Take to Register an NGO?

The time required to register an NGO varies depending on the type of registration:

• Section 8 Company: The registration process takes approximately 10-14 days.
• Trust Incorporation: The process of incorporating a trust takes about 20 days.
• Society Registration: The registration process for a society takes around 25 days.

Why Taxtrix?

Consultation for Selecting Registration Type

• Thorough Consultation: We conduct a comprehensive consultation to determine the best type of registration for your needs, whether it be NGO, Society, or Trust registration.
• Document Guidance: We provide detailed information on all the documents required to check NGO registration online forms.
• NGO Formation: The final step involves the formation of your NGO, ensuring a smooth and efficient process.

How Are Voluntary Organisations Funded?

Voluntary organisations, also known as nonprofits or non-governmental organisations (NGOs), can secure funding from various sources based on their mission, scope, and activities. Here are some common ways these organisations are funded:

• Individual Donations: Many voluntary organisations depend on donations from individual supporters. These contributions can be one-time or recurring. Individuals who support the organisation’s cause may donate to aid its operations.
• Grants: Organisations can apply for grants from foundations, government bodies, and other funding institutions. These grants can offer substantial financial support for specific projects or operational needs. Typically, organisations must submit detailed proposals explaining their plans and how the funds will be utilized.
• Corporate Sponsorships: Some businesses and corporations support nonprofit organisations through financial assistance or in-kind donations. This support can include sponsorships, cause-related marketing campaigns, or donations of goods and services.
• Fundraising Events: Voluntary organisations often organise events and fundraising campaigns to generate funds. These events can include charity galas, benefit concerts, charity runs, auctions, and more. They help raise money, engage the community, and increase awareness about the organisation’s mission.
• Membership Fees: Certain voluntary organisations have membership models where individuals or groups pay an annual fee to become members. In return, members receive benefits such as access to exclusive content, events, or services.
• Revenue from Goods and Services: Some voluntary organisations earn income by selling goods or services related to their mission. For example, a conservation organisation might sell eco-friendly products, or an art nonprofit might offer workshops or classes.
• Crowdfunding: Online crowdfunding platforms have become a popular method for nonprofits to raise funds from many individuals, often through small contributions. Platforms like Kickstarter, GoFundMe, and Indiegogo can help organisations reach a broader audience and garner support for specific projects.
• Endowments and Trusts: Voluntary organisations may establish endowment funds or trusts that generate investment income over time. This provides a stable source of funding for the organisation’s activities and allows for long-term planning.
• Government Funding: Some voluntary organisations receive funding from local, regional, or national government agencies for specific projects or services that align with governmental priorities.
• International Aid and Foundations: Organisations working on global issues or in developing countries may receive funding from international aid agencies, intergovernmental organisations, and international foundations.
• Collaborations and Partnerships: Voluntary organisations may collaborate with other nonprofits, government agencies, and private sector entities on joint projects or initiatives. These partnerships can bring additional funding and resources to support shared goals.

How to Download NGO Darpan Certificate?

Follow these steps to download your NGO Darpan certificate:

• Register on the NGO Darpan Portal: If your NGO is not already registered, create an account by visiting the official NGO Darpan website.
• Login to Your Account: After registration, log in to your NGO Darpan account using your credentials.
• Access the Certificate: Navigate to the relevant section or dashboard within the NGO Darpan portal to find the specific certificate you need (e.g., registration certificate, profile certificate).
• Download the Certificate: Find the option to download or generate the certificate. This may involve clicking a link or button associated with the certificate. Follow any on-screen instructions provided.
• Verify and Use the Certificate: After downloading, verify the accuracy of the information on the certificate. You can then use it for various purposes, such as grant applications, partnerships, or interactions with government agencies or stakeholders.