Choosing a type for your NGO can be critical and confusing. The articles provide appropriate information about all three types of registrations through which an NGO can certify.
In many countries, due to the large population size, government, sometimes, is not able to look after every section of society and other related concerns of the nation. Therefore, there is a need for a body that can help the citizen, animals, plants and environment to maintain a healthy life cycle.
These organisations are Non-governmental organisation (NGOs) that deals with social, political, environmental and almost every issue that can become degrade the standard of living of people and this also includes the protection and preservation of literature and antique historical pieces in museums.
If you are someone who is looking to start his/her own NGO then you should have some knowledge about its types. NGOs have different categories that operate differently, so they have varied registration certifications. Here is some information about NGOs and their types and what are the privileges that these certified NGOs enjoy.
What Exactly is an NGO?
An NGO, a Non-governmental organisation, is a non-profit organisation that has a particular aim to achieve but in general, they work for the upliftment of societies and especially the weaker section of the society that is not financially well.
These NGOs are run on ‘No profit, No loss’ and thus, they do not require much money for their functioning, Moreover, there is the intention to earn any monetary profit by running these organisations, they are just a helping hand for need ones.
NGOs are of various types and even it has several basis on which they can be classified. Classification on Orientation, working level, sector and registration type are some examples of it. The fund that goes into the operation of the organisation is usually raised by charity or is received by donors who are willing to help.
This basically a group of individuals that have a similar mindset and thus aim for an aligned goal with an intention o serve society. Generally, there is no interference by the government during their practices as the government does not hold any power over them. NGOs have their own rules and regulation which are usually formulated while considering their cause and main motive.
Types of NGOs – On the Basis of Registration
There are three NGOs on the basis of Registration
- Section 8 Company
- Trust– This type of NGO have usually three parties that are associated with the organisation, The simple principle of the work of Trust is that a particular property is transferred from the owner to other parties who hold that assets for the beneficiaries. This second part has a fiduciary duty to hold these lands and any other assets for the beneficiaries.
The trust further is divided into two types i.e. Public and Private. Public trusts are usually maintained by charities and donations from religious groups. This government by Religious Endowments Act, 1863, Charitable and religious act, 1920 etc.
Society– People with similar thinking and opinion come together to form a society. These societies are governed by the Societies Registration Act, 1860. These certified societies are also served with the advantage of the protection of taxes. But all kind of societies does not share the same privileges. Some selected societies are exempted from these benefits.
A society can be even formed with seven participants. No rule or regulation has to be applied to the founders of a society. No matter whether they are citizens of India or not, any individual is allowed to start their own society easily.
- Section 8 company– registering your NGO as a Section 8 company is almost like a limited company. Although it is identical at some point but then there are many differences between their functionalities and regulations. A Section 8 Company should only promote and uplift ports, commerce, education, art, religion, science, research and other like objects, no other promotion should be held in a Section 8 Company.
Like any other Non-profit organisation, Section 8 companies do have some benefits of getting registered with the government of India like the relaxation on the notice period general meeting. For normal limited companies, it is 21 days while the NGOs who are certified have this time period of only 14 days. Also, there is no limit on the number of directors in the organisation. Additionally, if an individual is a director in this working institution then it will not affect the number of dictatorships that the individual can hold in any other company.
Benefits of Getting Registered
1.Trust- By certifying as a trust NGO government have the complete right to provide you land as a donation. Also, exemption of tax, cesses and other dines are completely ignored for such categories of NGO. certification like 80G can be used to demand money for construction purposes. Additionally, they do have some plus points from the Entertainment tax and Service tac.
- Society – society organizations are completely free of the taxation imposed by the government. They also have legal distinct identities and therefore, no one can use their name in order to commit any illegal crime. Moreover, l limited liability is something that adds to the feature list of certificates.
On the other legal safeguards are also of great importance for any organization dealing with a Section 8 company.
- Section 8 Company– The very first benefit that they get is no limit of bounding on the minimum capital requirement for the firm. Their legal entity and no stamp duty are some other relaxations that a Section 8 Company has. Even with no stamp duty, any courts are payable. Another guaranteed benefit is security regarding the ownership including title transfer.
Importance of NGOs
NGOs have a great role to play in any area or any society. Many often also raise the voice of the common and try to represent their ideology on a larger platform. Apart from helping the needy person save the environment from pollution or any unhealthy practice that can be controlled easily.
Among all these, the most prominent benefit of having an is the spreading of awareness about the basic and legal rights of the people. So, even a common can could stand for his/her right and know where his/her rights got violated.
On a concluding note, this was all about a recent founder who should know about the types of registration of NGOs. There is a lengthy as well as confusing procedure for filing any of the complaints. A lawyer can help you in the same but being a professional is never easy. Vakilsearch connects you with the best lawyer that can easily smoothen the procedure of application. Additionally, 24×7 support is available for the users. These all services come at a very economical price that everyone could afford. So, check our website for more information and know the answers to your queries