Section 8 Company Compliances & Filings
Every Section 8 company has to carry out the annual compliance tasks listed under the Companies Act, 2013 and Income Tax Act, 1961. This ensures that the company is trustworthy and credible while avoiding penalties for non-compliance. Compliance tasks need to be carried out throughout the year and can be tedious.
TAXAJ's Annual Compliance Package for Section 8 Companies ensures these tasks are taken care of for you by experts. It saves your time and energy so that you can focus on the core activities of the company.
A end to end hand holding for your annual requirements is what we have in this plan. TAXAJ will assist you in matters like drafting, appointing, filling and much more.
It Usually takes 5 to 7 working days.
Services Covered
Who Should Buy
How It's Done
Documents Required
Services Covered
- Accounts Management
- Taxation Management
- Secretarial services of preparing board resolution, post AGM
- Yearly filing of MGT-7, AOC-4
- Disclosure of Interest by director (Form MBP-1)
- Assistance in appointment of Auditor, if required
Who Should Buy
- Companies want to comply to the Annual Compliance as mandated my ROC/MCA
How It's Done
- Purchase the plan
- Share the documents/details as requested by us.
- We shall prepare the documents as required & get signed by you.
- Prepare the form as applicable & file it.
Documents Required
- Bank Statement of the Company along with mentioning nature & party to whom paid or received (If not already audited & needs to be audited by us)
- Shareholders & Shareholding Details of the company. (Including any transfer of shares, if any)
- Bank Account Number & IFSC of All Active Bank Accounts.
- Resignation Letter from Previous Auditor & Challan of Form ADT-3, if any
- DSC Tokens of the Directors.
- Email & Contact Number of the Company
- Copy of MoA, AoA, COI
- Copy of board resolution
- List of shareholders with holdings
- Details of board composition
- Last year's tax return
- Particulars of penalties or compounding offences (if applicable)
What are compliances to be done by a Section-8 Company in India ?
What are compliances to be done by a Section-8 Company in India ?
| Compliances | Description | Due Date | Link |
|---|---|---|---|
| Commencement of Business (INC 20A) | For companies registered in India after November 2019, having a share capital, it is necessary to obtain a commencement if business certificate before commencing any business or exercising the borrowing powers. In case the individual fails to obtain this certificate, there is a penalty of Rs. 50,000 for the company Rs. 1000 per day for the directors for each day of default. | Within 180 days from Incorporation | File Now |
| Statutory Auditor Appointment | If the company fails to appoint an auditor, the company won't be allowed to commence business. Also, there is a penalty of Rs. 300 per month. | Within 30 days from Incorporation | File Now |
| KYC of Directors – Form DIR – 3 KYC and Web KYC of all Directors | All the directors of the company must be filed for the DIN eKYC or DIR-3 eKYC. In DIR-3 eKYC, the Director must provide a unique personal mobile number and a personal email address. There's a penalty of Rs. 5000 in case of failure to file DIN eKYC. | 30th September | File Now |
| Disclosure of Directors Interest by Directors – Form MBP-1 | Every Director of the Company in First Meeting of the Board of Director in each Financial Year shall disclose his interest in other entities. Directorship of other company Partnership firm where he/she is partner Shareholding of more than 2% in other Company List of relatives of Director. | First Board Meeting | |
| Disclosure of Non- Disqualification by Directors – Form DIR-8 | Every Director of the Company in each Financial Year will file with the Company disclosure of non-disqualification. It is declaration that Director was not disqualified to act as Director during the FY 2020-21. (i.e. previous FY) | Every first Board Meeting of the of relevant Financial year | |
| Delay in Payment to MSME Vendor: Form MSME – 1 | Company has to file this return half yearly in respect of pending payments to MSME vendors as at end of half year. All outstanding dues of more than 45 days payable to Micro or Small Enterprises suppliers. | Half yearly Return April to Sep – 30th October October to March – 30th April | |
| Return of Deposit: Form DPT-3 | Return of deposits that companies must file to furnish information about deposits and/or outstanding receipt of loan or money other than deposits. Mandatory Auditor certificate : – if the Form is filed “return of Deposits” or “return of Deposits as well as Exempted Deposits. | 30th June of Next Year | File Now |
| Circulation of Financial Statement & other relevant Documents | Company will send to the members of the Company approved Financial Statement, Directors’ Report and Auditors’ Report at least 21 clear days before the Annual General Meeting.. | 21 Clear Days before the AGM | |
| Directors’ Report | Preparation of the Directors report will be done with all the information required under Section 134. | 21 Clear Days before the AGM | File Now |
| Notice of AGM | Include following agenda where shareholders’ approval are required; appointment of Auditors, (if term expires) Directors (if appointed during the year/ Rotation of Director). ETC as and when required event based. MD and WTD require to be re-appointed after expiry of every five years by the Shareholders. | 30th September of Next Year | File Now |
| Appointment/Resignation/Change in Designation – Form DIR-12 of Director | If there is change in designation of Director at the AGM or Appointment or Resignation of Director. Regularization of Additional Director If company wants to appoint additional director as director, then it shall regularize the person as director in General Meeting by passing Shareholder Resolution. File form DIR-12 for Change in Designation of Director along with ordinary resolution within 30 days of AGM. | Within 30 Days of Meeting | File Now |
| Maintenance of Statutory Registers. | Company will maintain the following mandatory Registers: Register of Director, Registers of Director Shareholding, Registers of Members Registers of Transfer Registers of Related Party transaction etc. Other register as per companies act, 2013 | Every Quarter | File Now |
| Board Meetings – 173 & SS-I | Every Company shall hold a minimum number of FOUR meetings of its Board of Directors every year in such a manner that maximum gap between the two meetings should not be more than 120 (One hundred twenty) days. Notice of Board Meeting must be given 7 days prior to the meeting. Notice can be delivered either by hand, through registered post or electronic means. | Every Quarter | |
| Notice of AGM 101 & SS-II | Every Notice of the Annual General Meeting will be prepared as per Section 101 of the Companies Act, 2013 and Secretarial Standard – II. | ||
| Income Tax Return | Income tax returns need to be filed on or before 30th September 2021 for the Financial year 2020-21. | 31st October | File Now |
| MCA Form AOC-4 | The registered private limited companies must file MCA Form AOC-4 on or before 30th November 2021 for the FY2020-21. Failure to file AOC-4 will attract a penalty of Rs. 200 per day of default or delay. | 29th October or within 30 days from the annual general meeting for the FY | File Now |
| MCA Form MGT-7 | It is necessary to file MCA form MGT-7 on or before 31st December 2021 for FY2020-21. Failure to file MGT-7 attracts a penalty of Rs.200 Per day of default or delay. | 30th November or within 60 days from the annual general meeting for the FY | File Now |
| Hold Annual General Meeting | For a private limited company, it is mandatory to hold an annual general meeting once a year. Companies are required to keep their AGM within six months from closing the Financial year. | 6 Months from End of Financial Year | File Now |
Penalties for Non-Compliance
The Ministry of Corporate Affairs has set up penalty for section 8 Company not complying with the procedures:
- The Central Government may revoke the license granted to the company if it finds that the company is working fraudulently or in a manner violative to the object of the company.
- The companies will be punishable with fine, which shall not be less than ten lakh rupees and can be extended to one crore rupees.
- The directors and every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to twenty-five lakh rupees or with both.
- If it is found that the affairs of the company were conducted fraudulently, every officer in default shall be liable for action under section 447.
What is the benefit of following annual compliance of Section 8 of the Company?
The basic reason for meeting the compliance of Section 8 Company is to avoid penalties. Also, it ensures the smooth functioning of the company. Below are some of the listed points:
- Better Credibility of the Companies.
- Avoid getting into any legal trouble.
- To build trust amongst the customers.
- To avoid penalties.
Conclusion
Section 8 Company enjoys various exemptions and benefits over other types of NGOs. It is better to incorporate non-profit organizations in the form of a Company rather than trust or society. The company must follow all the event-based and mandatory compliances to avoid facing penalties imposed by the Government. The Ministry of Corporate Affairs has provided very strong punishments for non-compliance. Section 8 Company enjoys an extra benefit of Tax exemption if it gets registered under Section 12A and 80G of the Companies Act, 2013.
