Section 8 company (earlier Section 25 Company)
@ Rs. 8,999 *
Section 8 Company or a Non-Profit organisation (NPO) is a Company established for promotion commerce, art, science, sports, education, research activities, charity, religion or any other useful social object, provided the profits and donations is applied for promoting only the objects of the company and no dividend is paid to its members or owners.
The term Non-Profit means that the Company can generate profit or income, but needs to apply the income for promotion of the object and not for distribution to the promoters.
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Benefits of Section 8 company
Easy to generate funds through from Corporates
Section 8 is the preferred option by Large corporates intending to donate funds for CSR activities. These CSR funds are used by Section 8 company to attain its main object.
Greater trustworthiness in the market
Being a Private limited company is considered to be a trustworthy form of establishment by Corporates, Government Agencies and Vendors.
Protection due to Limited Liability
The Personal assets of the Directors, Shareholders are safe as the liability is Limited only upto the amount of shares held by them.
Raising Funds - Preferred choice of setup by Investors
VCs, Private Equity Funds and Angel Investors prefer a Private Limited Company as the Management, Board and Promoters can function independently and can have better transparency.
Stability for Employees
The employees have a sense of stability while working in a Corporate Environment and this can be used to retain top talent through ESOPs and other measures.
Easy Transferability of shares
The shareholders can easily sell the stake and transfer the shares. The ownership can also be changed easily in order to maintain continuity of operations of the company.
Better governance
Better standards can be implemented as Board Members can oversee whether the company is adhering to the predefined governance standards.