NGO REGISTRATION

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NGO Registration

NGO registration is a profit that enables Non profit organisations to provide services to the public, often with the support of the government, corporations, individuals, or groups. It's crucial for NGOs to comply with policy while serving the majority as a nongovernmental organisation.

All non-profit organisations, including Trust, Societies, and Section 8 Companies, are collectively referred to as NGOs in India. Such non-profit organisations are also known as 'Sangathan', 'Sangh', and 'Sangam.' All non-profit NGOs are eligible for an income tax exemption.

Registering a non-governmental organization (NGO) involves a series of steps and may vary depending on the country's regulations. Here is a general guide on how to register an NGO:

1. Define Your Mission and Objectives: Clearly outline the mission, goals, and objectives of your NGO. This will help in determining the type of registration and legal structure that suits your organization.
2. Choose a Legal Structure: NGOs can take various legal forms, such as trusts, societies, or non profit companies. The choice of legal structure depends on the laws of the country in which you are registering. Research the legal structures available in your jurisdiction and choose the one that aligns with your organization's goals.
3. Board of Directors/Trustees: Identify and assemble a board of directors or trustees. These individuals will be responsible for the overall governance of the NGO.
4. Name Your NGO: Choose a unique and meaningful name for your organization. Ensure that the selected name complies with the naming conventions and regulations in your country.
5. Prepare a Constitution or Bylaws: Draft a constitution or bylaws that outline the rules and regulations governing your NGO. Include information about the organization's purpose, membership, board structure, decision-making processes, and other relevant details.
6. Register the NGO: Submit the necessary documents to the relevant government authority for registration. The required documents may include the constitution or bylaws, details of board members, and any other documents specified by the registration authority.
7. Tax Exemption Status: If your NGO intends to be tax-exempt, inquire about the process of obtaining tax-exempt status. This often involves additional documentation and compliance with specific regulations.
8. Open a Bank Account: Once registered, open a bank account in the name of the NGO. This account will be used for managing the organization's finances.
9. Comply with Reporting Requirements: Familiarize yourself with the reporting and compliance requirements for NGOs in your jurisdiction. This may include submitting annual reports, financial statements, and other documentation.
10. Seek Professional Advice: Consider seeking legal advice or consulting with professionals experienced in NGO registration. They can provide guidance tailored to your specific situation and help navigate the legal requirements.
11. Local Requirements: Be aware of any specific requirements or restrictions imposed by local authorities. Different regions within a country may have additional regulations or preferences.
12. Networking: Connect with other NGOs and nonprofit organizations in your area. Networking can provide valuable insights into the registration process, funding opportunities, and collaborative initiatives.
13. Funding and Sustainability: Develop a strategy for funding and sustaining your NGO. This may include identifying potential donors, writing grant proposals, and establishing partnerships with other organizations.
14. Human Resources: Clearly define roles and responsibilities within your organization. This includes hiring staff or engaging volunteers. Ensure that you have a dedicated team to support the implementation of your projects and initiatives.
15. Community Engagement: Engage with the community you aim to serve. Understanding the needs and concerns of the community will help shape your NGO's programs and activities.
16. Legal Compliance: Stay informed about changes in laws and regulations that may affect NGOs. Regularly review and update your organization's policies and procedures to ensure ongoing compliance.
17. Monitoring and Evaluation: Establish a system for monitoring and evaluating your NGO's activities. This will help you assess the impact of your programs and make informed decisions for improvement.
18. Public Relations and Communication: Develop a communication strategy to raise awareness about your NGO's mission and activities. This includes creating a website, using social media, and engaging with the media to share your organization's story.
19. Capacity Building: Invest in the capacity building of your team members. Provide training and resources to enhance their skills and knowledge, contributing to the overall effectiveness of your NGO.
20. Risk Management: Identify potential risks and develop a risk management plan. This includes financial risks, operational risks, and any other factors that could impact the sustainability of your NGO.
21. Adaptability: NGOs often operate in dynamic environments. Stay adaptable and be prepared to adjust your strategies based on changing circumstances, emerging needs, or new opportunities.

Remember that the success of an NGO goes beyond registration; it involves ongoing commitment, effective management, and a genuine dedication to your mission. Regularly reassess and adapt your strategies to ensure your organization remains relevant and impactful.

What are the Types of NGO Registration in India?

In India, NGOs can typically register under three primary legal structures: Societies, Trusts, and Section 8 Companies (under the Companies Act, 2013). Each type has its own characteristics and requirements. Here's an overview of each:

1. Societies:

• Characteristics:

• Governed by the Societies Registration Act, 1860.
• Managed by a governing body or council.
• Typically used for promoting charitable activities, including education, health, and poverty alleviation.

• Registration Process:

• Requires a memorandum of association and rules and regulations.
• The governing body must be formed with a president, secretary, treasurer, and members.
• Application for registration is submitted to the Registrar of Societies.

1. Trusts:

• Characteristics:

• Governed by the Indian Trusts Act, 1882.
• Involves the creation of a trust deed.
• Commonly used for religious, educational, and charitable purposes.

• Registration Process:

• Requires a trust deed that outlines the objectives and operations of the trust.
• Trustees are appointed to manage the trust.
• Application for registration is made to the local Charity Commissioner or Registrar.

1. Section 8 Companies:

• Characteristics:

• Governed by the Companies Act, 2013.
• Mainly used for promoting art, science, commerce, education, research, social welfare, religion, charity, protection of the environment, or any other charitable objectives.
• Profits, if any, are used for promoting the company's objectives.

• Registration Process:

• Requires the preparation of a memorandum and articles of association.
• The application for registration is submitted to the Registrar of Companies (RoC).
• The words "Section 8" must be included in the name of the company.

1. Foreign Contributions (Regulation) Act (FCRA) Registration:

• Irrespective of the type of registration (society, trust, or section 8 company), NGOs seeking to receive foreign contributions must obtain FCRA registration.

1. 12A and 80G Registration:

• NGOs can also apply for income tax exemptions under Section 12A and 80G of the Income Tax Act, which provide exemptions on income and donations received, respectively.

1. There are three types of NGOs widely registered in India.

7.Trust

1. Trust registration refers to the process of legally establishing a trust in India. A trust is a form of non-profit organisation (NPO) that is created to provide assistance and support to specific causes, such as education, health care, and community development. The trust registration process is governed by the Indian Trusts Act, 1882, and is typically handled by a team of legal experts and professionals.

9.Society

1. Society registration refers to the process of forming a society under the Societies Registration Act, 1860. A society is a group of individuals who come together to achieve a common goal or objective. Societies are formed to promote charitable, religious, educational, scientific, literary, or social causes.

11.Section 8 Company

1. Section 8 Company is a type of non-profit organisation that is registered under Section 8 of the Companies Act, 2013. It is registered with the sole purpose of promoting commerce, art, science, religion, charity or any other useful object, and not for the purpose of making a profit. This type of company is also known as a Non-Profit Organisation or Non-Governmental Organisation (NGO).

Why Is NGO Registration Required?

• The organisation gains credibility, and those who contribute money will be more likely to affiliate themselves with those NGOs that have registration because it lends an air of authenticity.
• A local NGOs operations may be able to develop with the aid of NGO company registration, which guarantees greater exposure for the organisation.
• The range of both financial and human resources is expanded. The NGO will benefit because more volunteers will step forward.
• Register your business as an NGO in India in accordance with the 2013 Companies Act to receive a number of benefits for the company's directors. NGOs are exempt from a number of taxes in India, which enables the business to save taxes and invest the money in further projects.
• Companies that have been recognised by the ITR filing return act of 1961 as NGOs are not prohibited from selling their assets or interest-earning claims.
• All businesses organised as NGOs under the ITR Act of 2013 are exempt from stamp duty, providing the business with additional opportunities to reduce its tax burden. The entire tax savings from the stamp duty are then used to promote the company's philosophy.

Benefits of NGO Registration

• A registered NGO gains the legal status and becomes accountable for the funds received. For instance, when an individual donates funds to a charitable trust, it is received under the name of the organization and used for the trust’s activities. In an unregistered firm, the assets can be received under anyone’s name and may be used for their own profit.
• An organization that is registered as an NGO reinforces the ethical, social and legal norms of our society.
• The basic requirement for running an NGO is to have a bank account under its name. In order to open an account, it is mandatory to be registered as a Trust, Society or Section 8 Company.
• The registration of an NGO is necessary to seek tax exemption from the Income Tax Authority.

Some of the advantages of NGO registration are discussed below:

Avails Tax Exemption:  NGOs are exempt from a number of taxes, thus registering the company as an NGO under the Companies Act,2013 enables it to take advantage of these tax benefits and save money on taxes that it may then invest in more initiatives.
Ability to Purchase Assets:  After obtaining legal registration, your company will be allowed to make real estate purchases, retain fixed assets, and/or incur liabilities. The legislation forbids unregistered organisations from buying, retaining, or selling land.
Minimum Share Capital Is not Required: To operate autonomously, no minimum share capital is required. Donations made to NGOs may be used to directly finance them. This shows that NGOs don't necessarily need more funds to function freely.
Defence Against Personal Liability: You can acquire assets and stakes under your NGO's name and register them. This is a really elegant method of protecting oneself from any consequences for unlucky occurrences like divorce, foreclosure, or bankruptcy.
Changing Ownership: It is not illegal for NGOs established under the Companies Act of 2013 to transfer their ownership or rights to interest accrued under the Income Tax Act of 1961.
Corporate Entity: Your company's interactions and transactions with the community will improve as a corporate body. The NGO may also bring legal action to protect its interests or may be sued directly by registered trustees.
Exemption on Stamp Duty:  Section 8 corporations are free from stamp duty under the Income Tax Act since they are non-profit organisations, which enables the company to employ further tax-saving techniques. The corporation then uses all of the taxes saved by avoiding stamp duty to further its objectives. It also helps to protect the business's financial resources, which promotes productivity and allows for a more effective operation.
Structured Financial Plan:  For actions you carry out on behalf of the registered NGO, an NGO may offer a tax-free framework. NGOs are considered non-profit organisations and are exempt from paying taxes. You may design a sound financial plan that enables the business to run tax-free.
Stability of Entity:  Your organisation's registration may indicate that it has capable and accountable leadership. Similar will be seen by the public as more stable than an unregistered organisation. Political parties, the government, donor organisations, financial institutions, charity groups, and other NGOs will want to work with a recognised entity to achieve common objectives.
Perpetual Succession:  An NGO can therefore exist forever and carry on its work even when its founders or trustees pass away or resign. The organisation won't cease to exist until a court ruling in India officially declares it to be closed. Along with other benefits, this might make permanent succession possible.
Admission to Credit: An NGO can obtain loans from lenders and financial institutions by registering. You can finance a mortgage, buy land or fixed assets with the help of a lending facility. Additionally, you can use it to advertise the company's operations. Banks will want registration papers before approving a loan.
Name Preservation: No one in India may use the same name or a name that is confusingly similar to your organisation's once it has been registered. The benefit of this is that it prevents unauthorised use of your company's brand and reputation.
Opening Bank Account: The NGO may convey its transparency by opening a corporate account with a bank. Some individuals, the government, donor organisations, and other NGOs won't feel comfortable signing a cheque in your personal name for your organisation. The existence of a bank account for the NGO would be evidence that it is a legal entity and is prepared to accept donations. To open an account with a bank, you must present evidence of your organisation's registration.

Documents Required for NGO Registration

The specific documents required for NGO registration can vary based on the legal structure chosen and the regulations of the country or state in which the NGO is being registered. Below is a general list of documents often required for registering an NGO in India:

For Societies:

1. Memorandum of Association (MOA):

• This document outlines the objectives and rules of the society.

1. Rules and Regulations:

• Detailed rules and regulations governing the operations of the society.

1. Application Form:

• A prescribed application form for society registration.

1. Covering Letter:

• A letter specifying the purpose of registration and requesting approval.

1. List of Members:

• Names, addresses, and occupations of all members of the governing body.

1. Proof of Address:

• Address proof of the registered office of the society.

1. Affidavits:

• Affidavits from the president and secretary of the society.

For Trusts:

1. Trust Deed:

• A document that clearly outlines the objectives and rules of the trust.

1. Application Form:

• A prescribed application form for trust registration.

1. Covering Letter:

• A letter specifying the purpose of registration and requesting approval.

1. Affidavits:

• Affidavits from the trustees.

1. Proof of Identity and Address:

• Identity and address proof of the trustees.

For Section 8 Companies:

1. Memorandum and Articles of Association:

• These documents outline the objectives and rules of the Section 8 company.

1. Application Form (INC-12):

• Form for applying for a license under Section 8.

1. Declaration (INC-13):

• Declaration by professionals, promoters, or partners involved in the company.

1. Statement of Affairs (INC-14):

• A statement providing details of assets and liabilities.

1. Affidavits:

• Affidavits from the directors or promoters.

1. Proof of Identity and Address:

• Identity and address proof of the directors or promoters.

Common Documents:

1. PAN Card:

• Permanent Account Number of the NGO and its members.

1. Address Proof:

• Proof of the registered office address (e.g., utility bills or rent agreement).

1. Board Resolution:

• A resolution passed by the board of trustees or governing body authorizing the registration process.

1. FCRA Registration (if applicable):

• Foreign Contribution (Regulation) Act registration for NGOs planning to receive foreign contributions.

1. Bank Account Details:

• A copy of the NGO's bank statement and canceled cheque.

1. Registration Fee Receipt:

• Receipt of payment for the registration free

NGO Registration Procedure

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.

How Long Does It Take to Register an NGO?

• The process of section 8 company is 10-14 days
• There is a process of trust incorporation that will take 20 days
• The society registration process will take another 25 days.

How to Download NGO Darpan Certificate?

1. Register on the NGO Darpan Portal: If your NGO is not already registered on the NGO Darpan portal, you need to create an account by visiting the official website of NGO Darpan

2. Login to Your Account: Once registered, log in to your NGO Darpan account using your credentials.

3. Access the Certificate: Depending on the specific certificate you are looking to download (e.g., registration certificate, profile certificate, etc.), navigate to the relevant section or dashboard within the NGO Darpan portal.

4. Download the Certificate: Locate the option to download or generate the certificate. This might involve clicking on a link or button associated with the certificate you need. Follow any on-screen instructions.

5. Verify and Use the Certificate: After downloading the certificate, make sure to verify the accuracy of the information it contains. You can use the certificate for various purposes as required, such as submitting it for grant applications, partnerships, or other interactions with government agencies or stakeholders.