What Are the Advantages of Indian NGO Registration?

 A non-governmental organisation, or NGO, is an autonomous non-profit association. Depending on the extent of their operations, NGOs in India may register as Section 8 businesses, societies, or trusts.

NGOs can engage in a broad range of volunteer, institutional, or group-based activities, as long as its core goal is to advance the interests of society as a whole or of a particular, vulnerable social group.

NGOs engage in a variety of activities, such as human rights, social, advocacy, environmental, and educational activity.

There are three authorised methods for registering an NGO, and they are as follows:

filing of a trust under The Indian Trust Act, 1882.

registration of a society under the Societies Registration Act, 1860

Section 8 of The Companies Act, 2013 deals with company registrations.

The advantages of setting up an NGO in India

1. Take advantage of tax exemptions

Using the Companies Act of 2013 to register the company as an NGO allows for the receipt of certain tax benefits. Nonprofits have tax exemptions, allowing them to invest the money they save on new initiatives.

2. The right to purchase property

Your organisation may purchase real estate, own fixed assets, and/or take on liabilities under its common seal once it has obtained legal registration. Anywhere in the world that an unregistered organisation purchases, holds, or sells land is illegal.

3. There is no minimum share capital needed.

No minimum share capital is required in order for the business to operate independently. The donations given to NGOs can be used to directly fund them. This implies that NGOs can operate autonomously without requiring a larger share capital.

4. Defence against private debt

Assets and stakes may be purchased, acquired, and registered in the name of your non-profit. This is a means of shielding your company from unrestricted obligation resulting from unfortunate events like divorce, bankruptcy, foreclosure, or judgement debt.

5. Ownership transfer

NGOs formed under the Companies Act of 2013 are not prohibited from transferring their ownership or claims of the interests earned under the Income Tax Act of 1961.

6. Stamp duty exemption

The Income Tax Act exempts section 8 corporations, which are non-governmental organisations, from stamp duty, providing the company with additional tax-saving options. The corporation uses all of the taxes it saves on stamp duty to further the goals it has set for itself.

7. A well-organized financial schedule

Possessing an NGO may enable you to conduct activities under its registered charity umbrella without paying taxes. NGOs are exempt from taxes and regarded as not-for-profit. You can create a well-organized financial plan that frees the company from tax obligations so it can operate.

8. Entity stability

The public will likely believe that your organisation is led by capable and responsible individuals if it is registered. To achieve shared goals, political parties, the government, donor agencies, financial institutions, nonprofits, and other NGOs will wish to collaborate with a recognised group.

9. Unending succession

This implies that an list of top 10 NGO in India has an endless lifespan and will continue to exist even in the event that its founder or trustees pass away or quit. The only way the organisation will end is if the Order of Court of India legally winds it up. Among other advantages, this might provide unending succession.

10. Obtaining credit

An NGO can obtain loans from lenders and financial institutions by registering. A lending facility can be used for fixed assets acquisition, land acquisition, mortgage financing, and promotion of the organization's operations. Prior to granting a loan, banks will want to see documentation of registration.

11. Maintenance of name

No one in all of India may use the same name or a name that is similar to it once your organisation is registered. This has the advantage of guarding against unauthorised usage of your company name and picture.

12. Creating a bank account

The NGO may demonstrate its financial transparency by opening a corporate account with a bank. Some government officials, donors, and other non-governmental organisations won't feel comfortable writing you a cheque in your personal name on behalf of your organisation. An NGO's bank account would be an evidence of its legal existence and that it is open to accepting donations. To open such an account, you must submit documentation proving your company is registered.

How to be eligible for tax exemption in India as an NGO

In India, registering an NGO has several advantages. The primary cause is the income tax refund obtained under Sections 12A and 80G. NGOs that have registered under 12A may be eligible for an exemption from the income tax division. NGOs who have earned their 80G certification draw in higher financial contributions from supporters. NGOs are liable to standard tax rates if they are not registered.

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