# Section 8 Company by a Foreign Organisation in India (2026)

> Source: https://krystal7.com/insights/section-8-company-foreign-organisation-india
> Publisher: Krystal7 Consultants (Krystal7 Innovations Private Limited), Gurugram, India
> Author: CA Nandini
> Published: 28 Oct 2026; updated 14 Nov 2026
> Summary: A Section 8 company by a foreign organisation can take FDI, but grants need FCRA permission first. Licence through SPICe+, tax registration in Form 104.

*Written by CA Nandini, Krystal7 Consultants. Last updated 28 October 2026.*

**A foreign organisation can own a Section 8 company in India, because it is an "Indian company" that may issue shares to a non resident. The company applies its income to its objects, pays no dividend and is incorporated through SPICe+, which carries the licence application. Equity from the parent is FDI, reported in FC-GPR within 30 days of allotment. Grants and donations from abroad are foreign contribution and need FCRA registration or prior permission first. Tax exemption under the Income Tax Act, 2025 comes from registration under section 332, applied for in Forms 104 and 105.**


This page is for foundations, charities, associations and companies abroad that want an Indian non profit entity. It covers the company law, the licence process in 2026, FDI and FCRA, tax registration under the 2025 Act, CSR, annual duties and the alternatives. A worked example uses a UK foundation funding an education programme in Delhi. We read every source cited here on 26 Oct 2026.

## What is a Section 8 company?

A Section 8 company is a company that the Central Government licenses under section 8 of the Companies Act, 2013. Section 8(1)(a) lists its permitted objects, such as education, research, social welfare, charity and protection of environment. The company must apply its profits and other income to those objects. It must also prohibit any dividend to its members.

In return, the licence lets the company drop the word "Limited" or "Private Limited" from its name. Section 8(2) gives it all the privileges and obligations of a limited company. Section 8(3) also allows a firm to be a member.

A Section 8 company can be limited by shares. That matters for a foreign owner, because shares are the route for FDI. The exemption notification for Section 8 companies, G.S.R. 466(E) of 5 Jun 2015, switches off the minimum paid up capital requirement in sections 2(68) and 2(71).

A Section 8 company is never a small company. The limits in force from 1 Dec 2025, paid up capital up to ₹10 crore and turnover up to ₹100 crore, exclude it. It gets none of the small company relaxations.

| Feature | Section 8 company | Ordinary Private Limited company |
|---|---|---|
| Objects | Limited to the objects in section 8(1)(a) | Any lawful business |
| Profits | Applied to objects; dividends prohibited | Can be distributed as dividend |
| Name | No "Limited" or "Private Limited" | Must end with "Private Limited" |
| Change of memorandum or articles | Previous approval of the Central Government (section 8(4)(i)) | General provisions of the Act |
| Board meetings | At least one in every six calendar months (G.S.R. 466(E)) | Section 173(1) applies in full |
| Small company status | Never | Possible within the limits |
| Amalgamation | Only with another Section 8 company with similar objects (section 8(10)) | With any company |

Sources: Companies Act, 2013, section 8, on India Code; MCA notification G.S.R. 466(E) of 5 Jun 2015 on India Code, read 26 Oct 2026.

## How does the Section 8 licence process work in 2026?

The licence now comes with incorporation. Rule 19(1) of the Companies (Incorporation) Rules, 2014 originally asked for Form INC-12. The Companies (Incorporation) Sixth Amendment Rules, 2019 replaced Form INC-12 with "Form INC-32 (SPICe)" from 15 Aug 2019. SPICe+ is the current version of that form, so a new Section 8 company files one SPICe+ application for both the licence and the incorporation.

Form INC-12 has not disappeared. It is now the application by an existing company that wants a licence under section 8(5), under rule 20. A foreign organisation that already owns an Indian company with suitable objects would use that route.

Rule 19 lists what goes with the application. Our [SPICe+ guide](/insights/spice-incorporation-spice-plus-guide-2026) covers the rest of the filing, from name reservation to the linked forms.

| Document | Form or rule | Who prepares it |
|---|---|---|
| Incorporation and licence application | Form INC-32 (SPICe+), rule 19(1) as amended from 15 Aug 2019 | Company's professional, signed by subscribers and directors |
| Memorandum of association | Form INC-13, rule 19(2) | Drafted for the actual objects |
| Declaration of conformity with section 8 | Form INC-14, by an advocate, chartered accountant, cost accountant or company secretary in practice | Practising professional |
| Estimate of income and expenditure | Next three years, with sources and uses, rule 19(3)(c) | Promoters with their accountant |
| Declaration by each applicant | Form INC-15, rule 19(3)(d) | Each subscriber |
| Licence | Form INC-16 for a new company; Form INC-17 for an existing company | Registrar |

Sources: Companies (Incorporation) Rules, 2014, rules 19 and 20, and the Companies (Incorporation) Sixth Amendment Rules, 2019, on India Code, read 26 Oct 2026.

The objects clause decides most of what follows. In our experience the Registrar reads the objects closely against section 8(1)(a), and a commercial object in a charitable list draws a query. The same clause later drives the FDI route, the FCRA purpose and the tax registration.

Foreign subscribers also need legalised documents. For Commonwealth countries apostille is not mandatory, and simple notarisation has worked on our filings. The UAE does not use the apostille route, so documents go through MOFA attestation and consularisation. The board also needs a resident director, which our [guide to the resident director requirement](/insights/resident-director-requirement-indian-company) explains.

## Can a foreign organisation invest in a Section 8 company under FEMA?

Yes, by subscribing to its shares. Paragraph 2.3 of the RBI Master Direction on Foreign Investment in India, updated to 15 Jun 2026, defines "Indian company" by reference to the Companies Act, 2013. A Section 8 company fits that definition. The same paragraph leaves out a society, a trust and any entity the FDI Policy excludes.

We found no paragraph in the Master Direction that treats Section 8 companies differently, so the general rules apply. The entry route and any sectoral cap depend on the company's activity.

Our [list of FDI automatic route sectors](/insights/fdi-automatic-route-sectors-in-india) shows how the activity decides the route. An investor from a land border country needs Government approval under Press Note 3, which adds about six months on our filings.

The company must issue the shares within 60 days of receiving the money, under regulation 3.1 of FEMA 395/2019-RB. It files Form FC-GPR within 30 days of the issue under regulation 4(1). Our [FC-GPR guide](/insights/fc-gpr-filing-timeline-and-process-for-foreign-founders) gives the steps, and our [guide to FEMA pricing](/insights/fema-pricing-guidelines-share-valuation) covers the valuation.

| Money from the foreign organisation | Law that governs it | First filing | Main limit |
|---|---|---|---|
| Subscription to shares | FEMA (Non Debt Instruments) Rules, 2019 and the Master Direction | FC-GPR within 30 days of allotment | Entry route and pricing |
| Grant or donation | Foreign Contribution (Regulation) Act, 2010 | FCRA registration or prior permission before receipt | Use only for the stated purpose; no onward transfer |
| Interest earned on a grant | FCRA, section 2(1)(h), Explanation 2 | Counts as foreign contribution | Same as the grant |

Sources: RBI Master Direction on Foreign Investment in India (updated up to 15 Jun 2026), paragraph 2.3; FEMA 395/2019-RB; FCRA, 2010 on India Code, read 26 Oct 2026.

## When does a Section 8 company need FCRA registration?

It needs registration or prior permission before it accepts any foreign contribution for its programme. Section 11(1) of the Foreign Contribution (Regulation) Act, 2010 covers any person with a definite cultural, economic, educational, religious or social programme. Such a person needs a certificate of registration, or under section 11(2), prior permission for a specific purpose and source.

The Act covers Section 8 companies by name. Section 2(1)(m)(iv) includes in "person" a company registered under section 25 of the Companies Act, 1956, the predecessor of section 8.

### What counts as foreign contribution?

Section 2(1)(h) defines foreign contribution as the donation, delivery or transfer, by a foreign source, of an article, currency or security. Explanation 1 catches money passed on by someone who received it from a foreign source. Explanation 2 treats interest earned on foreign contribution as foreign contribution too.

The Act does not say in terms whether share subscription money is foreign contribution. On our files we treat equity from the parent as FDI under FEMA, and every grant or donation as foreign contribution under the FCRA. We keep the two in separate accounts from the first remittance and take a written FCRA view before the money moves.

### When is the Section 8 company itself a foreign source?

Section 2(1)(j)(vi) makes a company a foreign source when foreign governments, citizens or bodies hold more than half the nominal value of its share capital. A proviso takes the company out of that definition where the foreign shareholding is within the limits specified under FEMA. The Finance Act, 2016 inserted that proviso, and the Finance Act, 2018 made it effective from 5 Aug 1976.

So a wholly owned company within FEMA limits is not a foreign source because of its shareholding. Any foreign contribution it receives keeps that character, though, and section 7 stops it from passing that money on.

### What did the FCRA Amendment Act, 2020 change?

The Foreign Contribution (Regulation) Amendment Act, 2020 (Act 33 of 2020) came into force on 29 Sep 2020. It left the definition of foreign source alone and changed how registered entities receive and spend foreign money.

| Provision | Rule after the 2020 amendment |
|---|---|
| Section 7 | No registered person, or person with prior permission, may transfer foreign contribution to any other person |
| Section 8(1)(b) | Administrative expenses may not exceed 20 percent of the foreign contribution received in a financial year, unless the Central Government approves more |
| Section 12(1A) | Every applicant must open an "FCRA Account" under section 17 and give its details in the application |
| Section 17(1) | Foreign contribution must be received only in the FCRA Account at the branch of State Bank of India in New Delhi that the Government notifies |
| Section 12(3) | The Government decides an application ordinarily within ninety days |
| Section 12(6) | A certificate is valid for five years; prior permission is valid for the specific purpose or amount |

Source: Foreign Contribution (Regulation) Act, 2010 as amended by Act 33 of 2020, on India Code, read 26 Oct 2026.

The section 7 bar is the point most foreign foundations miss. A Section 8 company cannot pass foreign grants on to local NGOs, even registered ones. Each Indian partner needs its own FCRA registration or prior permission.

A newly formed company normally starts with prior permission. The registration form under the Foreign Contribution (Regulation) Rules, 2011 asks for activities and audited accounts for the past three years. On our files a new company seeks prior permission for a named grant from a named donor, and registers once it has a track record.

## How does a Section 8 company get tax exemption under the Income Tax Act, 2025?

It registers as a non profit organisation under section 332 of the Income Tax Act, 2025, in force since 1 Apr 2026. For a new company, registration has two steps.

Form 104 (formerly Form 10A) is the application for provisional registration under section 332(3), and for provisional approval under section 354(2). A new organisation files it electronically to the Commissioner of Income Tax (CPC). Provisional registration lasts three tax years or up to six months from the start of activities, whichever is earlier.

Form 105 (formerly Form 10AB) is the application for regular registration or approval. A provisionally registered organisation applies within six months of starting activities. Regular registration lasts five tax years, or ten where total income did not exceed ₹5 crore in each of the two preceding tax years.

Approval under section 354 is what lets donors claim a deduction. The Form 105 guidance note links that approval to the donor deduction under section 133(1)(b)(ii). Our [guide to the Income Tax Act, 2025 changes](/insights/income-tax-act-2025-changes-for-foreign-owned-companies) explains the wider renumbering.

| Purpose | Form under the Income Tax Rules, 2026 | Former form | Section of the 2025 Act |
|---|---|---|---|
| Provisional registration or approval | Form 104 | Form 10A | 332(3) and 354(2) |
| Regular registration or approval | Form 105 | Form 10AB | 332(3) and 354(2) |
| Order for provisional registration | Form 106 | Form 10AC | 332 and 354 |
| Order for regular registration, rejection or cancellation | Form 107 | Form 10AD | 332 and 354 |
| Option on income applied | Form 108 | Form 9A | 341(7) |
| Statement of accumulation | Form 109 | Form 10 | 342(1) |
| Audit report of a registered non profit organisation | Form 112 | Forms 10B and 10BB | 348 |
| Statement of donations received | Form 113 | Form 10BD | 354(1) |
| Certificate of donation to the donor | Form 114 | Form 10BE | 354(1)(g) |

Sources: Income Tax Department form map and guidance notes on Forms 104 and 105, read 26 Oct 2026.

We file Form 104 before the first activity, so the company has a registration number when the first donation arrives.

## Can a Section 8 company owned by a foreign organisation receive CSR funds?

Yes, once it meets rule 4(1) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 and registers in Form CSR-1. Rule 4(1), as substituted on 22 Jan 2021, lets a company spend CSR money through four kinds of entity. The route open to a foreign organisation's Section 8 company is usually clause (d).

| Clause of rule 4(1) | Entity | Conditions |
|---|---|---|
| (a) | Section 8 company, public trust or society established by the company, alone or with another company | Registered under sections 12A and 80G of the Income Tax Act, 1961 |
| (b) | Section 8 company, trust or society established by the Central or a State Government | None more |
| (c) | Entity established under an Act of Parliament or a State legislature | None more |
| (d) | Any other Section 8 company, public trust or society | Sections 12A and 80G registration and a track record of at least three years in similar activities |

Source: Companies (CSR Policy) Amendment Rules, 2021, G.S.R. 40(E) of 22 Jan 2021, on India Code, read 26 Oct 2026.

Clause (a) speaks of an entity established by "the company", meaning the Indian company spending CSR money. A foreign parent's own Section 8 company does not fit it unless an Indian group company joins as a founder. Otherwise the Section 8 company waits for its three year track record under clause (d).

Rule 4(2) requires every implementing entity to file Form CSR-1 electronically with the Registrar, from 1 Apr 2021. A practising chartered accountant, company secretary or cost accountant verifies it, and the system generates a CSR Registration Number. Rule 4(1) still names sections 12A and 80G of the 1961 Act, so we check the current text before relying on a section 332 registration. Our [guide to CSR for foreign owned companies](/insights/csr-applicability-foreign-owned-company-india) covers the spending side.

## What annual compliance does a Section 8 company have?

A Section 8 company files the same annual company returns as any other company, with FEMA, FCRA and tax filings on top. The exemptions in G.S.R. 466(E) lighten the board and meeting rules. Since G.S.R. 584(E) of 13 Jun 2017, they apply only if the company has not defaulted under section 137 or section 92.

| Area | Duty | Source |
|---|---|---|
| Company law | AOC-4 for financial statements and MGT-7 for the annual return | Companies Act, sections 137 and 92 |
| Board meetings | At least one meeting in every six calendar months | G.S.R. 466(E), serial 14 |
| Board quorum | Eight members or 25 percent of total strength, whichever is less, and at least two | G.S.R. 466(E), serial 15 |
| General meeting notice | 14 days instead of 21 days | G.S.R. 466(E), serial 5 |
| Independent directors and nomination committee | Not required | G.S.R. 466(E), serials 9 and 17 |
| FEMA | Annual FLA return to RBI if the company has foreign shareholding | FEMA reporting framework |
| FCRA | Receipts only in the FCRA Account; annual intimation of receipts and use; 20 percent administrative cap | FCRA, sections 8, 17 and 18 |
| Income tax | Audit report in Form 112; Form 113 for donations; Form 114 to each donor | Income Tax Act, 2025, sections 348 and 354 |

Sources: G.S.R. 466(E) of 5 Jun 2015 and G.S.R. 584(E) of 13 Jun 2017 on India Code; FCRA, 2010; Income Tax Department form map, read 26 Oct 2026.

Our [AOC-4 and MGT-7 guide](/insights/aoc-4-mgt-7-annual-filing-foreign-owned-company) explains the company law filings for a foreign owned company.

## What restrictions apply to a Section 8 company?

The licence comes with conditions that bind the company for life. Most foreign organisations accept them, because the restrictions are what make the company credible to donors and regulators.

| Action | What the law requires | Provision |
|---|---|---|
| Change the memorandum or articles | Previous approval of the Central Government | Section 8(4)(i) |
| Convert into another kind of company | Special resolution, Form INC-18 to the Regional Director, newspaper notice in Form INC-19, notice to tax authorities and others, who have 60 days to object | Section 8(4)(ii); rules 21 and 22 |
| Breach the licence or act fraudulently | Licence revoked by order after a hearing; name must then add "Limited" or "Private Limited" | Section 8(6) |
| After revocation | Winding up or amalgamation with another Section 8 company, if the Government orders it | Sections 8(7) and 8(8) |
| Winding up | Surplus assets go to another Section 8 company with similar objects, or are sold with the proceeds credited to the Insolvency and Bankruptcy Fund | Section 8(9) |
| Default under section 8 | Company fine of ₹10,00,000 to ₹1,00,00,000; directors and officers ₹25,000 to ₹25,00,000; section 447 if affairs were conducted fraudulently | Section 8(11) |

Sources: Companies Act, 2013, section 8 (as amended by Act 29 of 2020), and Companies (Incorporation) Rules, 2014, rules 21 and 22, on India Code, read 26 Oct 2026.

## What are the alternatives to a Section 8 company for a foreign organisation?

A Section 8 company is the only non profit form in this list that can take FDI. The others either stay part of the foreign organisation or sit outside the FDI rules altogether.

| Point | Section 8 company | Liaison office | Project office | Public charitable trust | Society |
|---|---|---|---|---|---|
| Legal form | Indian company under the Companies Act, 2013 | Office of the foreign entity under FEMA 22(R)/2016-RB | Office of the foreign entity for one project | Public trust created by deed; the Indian Trusts Act, 1882 does not apply to charitable endowments | Society under the Societies Registration Act, 1860 or a state Act |
| Foreign ownership | Can be 100 percent foreign owned | The foreign entity itself | The foreign entity itself | Control sits with the trustees in the deed | Control sits with the members and governing body |
| FDI | Yes, as an "Indian company" | Not applicable | Not applicable | No; trusts are excluded from "Indian company" | No; societies are excluded from "Indian company" |
| Approval to set up | Licence through SPICe+ | RBI approval for an NGO or non profit; FCRA registration instead if it runs FCRA activities | RBI approval for an NGO or non profit | Deed registration as state practice requires (check at filing) | Registrar of Societies |
| Foreign grants | FCRA registration or prior permission | Not for FCRA activities | Not for FCRA activities | FCRA registration or prior permission | FCRA registration or prior permission |
| Validity | Perpetual | Generally three years | Tenure of the project | Perpetual | Perpetual |
| Tax registration under section 332 | Yes | No | No | Yes | Yes |

Sources: RBI Master Direction on Foreign Investment in India, paragraph 2.3; RBI Master Direction on Establishment of BO, LO and PO (updated as on 18 May 2021), paragraph 1; Indian Trusts Act, 1882, section 1; Societies Registration Act, 1860, section 20, on India Code, read 26 Oct 2026.

The RBI Master Direction on branch, liaison and project offices sends applications from an NGO, a non profit organisation or a foreign government body to RBI. Where such an entity runs activities covered by the FCRA, it must obtain FCRA registration instead of FEMA permission. Our [liaison office guide](/insights/liaison-office-in-india-rbi-rules) covers the office route, and our [branch office guide](/insights/branch-office-in-india-rbi-rules) covers project offices.

## How long does it take and what drives the cost?

The incorporation follows our standard SPICe+ timeline, and the FCRA and tax steps run after it.

| Stage | Time on our filings or under the law | Source |
|---|---|---|
| Name reservation | 48 working hours | Krystal7 timeline |
| Apostille and notarisation abroad | About 4 to 5 business days for the client | Krystal7 timeline |
| SPICe+ filing after documents arrive | Within 24 working hours | Krystal7 timeline |
| Registrar approval with licence | A further 96 to 120 hours | Krystal7 timeline |
| Press Note 3 approval, land border investors | About six months more | Krystal7 timeline |
| Bank account | About 30 calendar days after incorporation | Krystal7 timeline |
| Provisional tax registration order | Within one month after the end of the month of application | Form 104 guidance note |
| FCRA registration or prior permission | Ordinarily within ninety days | FCRA, section 12(3) |
| Regular tax registration order | Within six months from the end of the quarter of application | Form 105 guidance note |

Sources: Krystal7 incorporation timeline (restated Oct 2026); FCRA, 2010, section 12(3); Income Tax Department guidance notes on Forms 104 and 105, read 26 Oct 2026.

Government fees are a small part of the cost. Name reservation costs ₹1,000, and the MCA registration fee is nil for authorised capital up to ₹15 lakh. PAN and TAN cost ₹143, and stamp duty depends on the state. Section 8 work is not on our published fee bands, so we quote in writing within 48 hours of a scoping call, with government fees at cost.

The bigger cost drivers are the objects drafting, document legalisation abroad, the FCRA application and the tax registrations. A Section 8 company also carries the full annual filing load, with no small company relaxations.

## Worked example for a UK foundation in Delhi

These are assumptions for illustration. A UK charitable foundation sets up a Section 8 company in Delhi, limited by shares, to run teacher training in government schools. The foundation subscribes ₹10,00,000 of equity and plans a grant of ₹60,00,000 in the first full year.

The incorporation costs ₹1,000 for name reservation and ₹143 for PAN and TAN, plus Delhi stamp duty. The MCA registration fee is nil, because authorised capital of ₹10,00,000 is below ₹15 lakh.

The ₹10,00,000 subscription is FDI, so FC-GPR follows within 30 days of allotment. The ₹60,00,000 grant is foreign contribution. The company first opens its FCRA Account at the notified State Bank of India branch in New Delhi. It then applies for prior permission naming the foundation and the amount.

Section 8(1)(b) of the FCRA caps administrative expenses at 20 percent of the foreign contribution received in the year. On ₹60,00,000, that is ₹12,00,000 at most, leaving at least ₹48,00,000 for the programme. If the grant earns ₹1,50,000 of bank interest, that interest is also foreign contribution under Explanation 2 to section 2(1)(h).

| Item | Amount or deadline | Rule |
|---|---|---|
| Name reservation | ₹1,000 | MCA fee |
| PAN and TAN | ₹143 | SPICe+ Part B challan |
| MCA registration fee (authorised capital ₹10,00,000) | Nil | Nil up to ₹15 lakh |
| Equity from the foundation | ₹10,00,000 | FDI; FC-GPR within 30 days of allotment |
| Grant from the foundation | ₹60,00,000 | Foreign contribution; prior permission first |
| Maximum administrative spend from the grant | ₹12,00,000 (20 percent) | FCRA, section 8(1)(b) |
| Minimum programme spend from the grant | ₹48,00,000 | Balance of the grant |
| Interest of ₹1,50,000 on the grant | Treated as foreign contribution | FCRA, section 2(1)(h), Explanation 2 |
| Onward grant to a partner NGO | Not allowed | FCRA, section 7 |

Sources: Krystal7 fact sheet for MCA fees and SPICe+ challans; FEMA 395/2019-RB; FCRA, 2010 on India Code, read 26 Oct 2026.

The company files Form 104 before the training starts, and Form 105 within six months of the start of activities. The UK foundation has no Indian taxable income in this example, so the donor deduction does not help it. Indian donors can claim the deduction under section 133(1)(b)(ii) once the company holds approval under section 354.

## Common mistakes

1. **Treating equity and grants as one stream.** Fix: route equity through FEMA with an FC-GPR, and route grants through the FCRA Account under a registration or prior permission.
2. **Planning to pass foreign grants on to partner NGOs.** Fix: design the programme so the Section 8 company spends the money itself, because section 7 bars onward transfer.
3. **Drafting broad objects with a commercial line.** Fix: write objects that fit section 8(1)(a) and match the programme the parent will fund.
4. **Accepting a grant before FCRA permission arrives.** Fix: apply for prior permission first and keep the money abroad until the order issues.
5. **Missing a Companies Act filing.** Fix: file AOC-4 and MGT-7 on time, because a default removes the G.S.R. 466(E) exemptions.
6. **Waiting for activities before tax registration.** Fix: file Form 104 before the first activity, then Form 105 within six months of starting.
7. **Assuming a parent's foundation qualifies for CSR at once.** Fix: plan for the three year track record under rule 4(1)(d), or bring in an Indian group company as a founder.
8. **Changing the objects by board resolution alone.** Fix: seek the Central Government's previous approval under section 8(4)(i) before the change takes effect.

## Checklist for a Section 8 company owned by a foreign organisation

1. Define the programme and the objects that fit section 8(1)(a).
2. Confirm the FDI route for that activity, and the Press Note 3 position of the investor.
3. Prepare the memorandum in Form INC-13 and the articles.
4. Prepare the three year estimate of income and expenditure.
5. Legalise the foreign organisation's documents for the country route.
6. Obtain the Form INC-14 declaration from a practising professional and Form INC-15 declarations from each applicant.
7. File SPICe+ for incorporation and the licence.
8. Open the bank account and receive the share subscription.
9. Allot shares within 60 days and file FC-GPR within 30 days of allotment.
10. Open the FCRA Account at the notified State Bank of India branch in New Delhi.
11. Apply for FCRA prior permission before any grant leaves the parent.
12. File Form 104 for provisional registration before activities start.
13. File Form 105 within six months of starting activities.
14. Calendar AOC-4, MGT-7, the FLA return, the FCRA return and Form 112.

To have us structure the entity and run the filings, start with our [legal advisory service](/services/legal-advisory.html).

## Frequently Asked Questions

### Can a foreign company own 100 percent of a Section 8 company in India?
Yes, if the company's activity allows it. A Section 8 company is an "Indian company" under paragraph 2.3 of the RBI Master Direction on Foreign Investment, so it can issue shares to a non resident. The entry route and any cap depend on the activity, and the company files FC-GPR within 30 days of allotment.

### Is a Section 8 company incorporated through SPICe+?
Yes. The Companies (Incorporation) Sixth Amendment Rules, 2019 replaced Form INC-12 with Form INC-32 (SPICe) in rule 19(1) from 15 Aug 2019. SPICe+ is the current version, and the licence is issued with incorporation.

### Does a Section 8 company need FCRA registration?
Only if it will accept foreign contribution for its programme. Section 11 of the FCRA requires registration, or prior permission for a specific purpose and source, before that money arrives. Equity governed by FEMA is a separate stream, and we treat it that way on our files.

### Is a Section 8 company with foreign shareholding a foreign source?
Not because of its shareholding, if that shareholding is within FEMA limits. Section 2(1)(j)(vi) makes a company more than half foreign held a foreign source, but a proviso excludes companies within the FEMA limits. Foreign contribution the company receives keeps its character whatever the company's status.

### Can an FCRA registered Section 8 company pass grants to other Indian NGOs?
No. Section 7, as substituted by the FCRA Amendment Act, 2020, bars any registered person from transferring foreign contribution to any other person. Each Indian partner needs its own FCRA registration or prior permission to receive foreign money.

### What replaced sections 12A and 80G under the Income Tax Act, 2025?
Registration of a non profit organisation is under section 332, and approval for donations is under section 354. Form 104 replaced Form 10A, and Form 105 replaced Form 10AB. Donors claim their deduction under section 133(1)(b)(ii).

### How long does provisional registration last?
Three tax years, or up to six months from the start of activities, whichever is earlier. The organisation then applies for regular registration in Form 105, which lasts five tax years. It lasts ten tax years where total income was ₹5 crore or less in each of the two preceding tax years.

### Can a Section 8 company pay dividends to its foreign parent?
No. Section 8(1)(c) requires the company to prohibit any dividend to its members, and section 8(1)(b) requires it to apply its profits and income to its objects. Rule 22 also asks the board to declare on conversion that no income or property went to members by dividend, bonus or otherwise.

### Can a foreign parent's Section 8 company receive CSR money from Indian companies?
Yes, once it qualifies under rule 4(1) of the CSR Rules and registers in Form CSR-1. Without an Indian company as a founder, it usually needs the tax registrations and a three year track record under clause (d). A practising professional must verify the CSR-1.

### Can a Section 8 company convert into an ordinary company?
Yes, but only under section 8(4)(ii) and rules 21 and 22. The company passes a special resolution and applies to the Regional Director in Form INC-18. It also publishes a notice in Form INC-19 and serves it on the tax authorities, the Charity Commissioner and others, who have 60 days to respond.

### What happens to the assets if a Section 8 company winds up?
They cannot go back to the members. Section 8(9) allows surplus assets to pass to another Section 8 company with similar objects, or to be sold with the proceeds credited to the Insolvency and Bankruptcy Fund. The Tribunal can impose conditions on the transfer.

### Can a foreign NGO open a liaison office instead?
Only with RBI's approval, and not for FCRA activities. The RBI Master Direction sends liaison office applications from NGOs and non profit organisations to RBI. Where the entity runs activities covered by the FCRA, it must obtain FCRA registration instead of FEMA permission.

## Sources

- India Code, The Companies Act, 2013, section 8 (Formation of companies with charitable objects, etc.), read 26 Oct 2026, https://indiacode.gov.in/items/78e7b34e-4cd6-47ba-853f-fb208390b100
- India Code, The Companies (Incorporation) Rules, 2014, Chapter II, rules 19 to 22, read 26 Oct 2026, https://indiacode.gov.in/items/329d3510-d2d9-47a2-99c7-ec5e8d1eba61
- India Code, Companies (Incorporation) Sixth Amendment Rules, 2019, read 26 Oct 2026, https://indiacode.gov.in/items/9e67af68-8c2c-4dbc-adba-547f814d6fd2
- India Code, MCA notification G.S.R. 466(E) of 5 Jun 2015, exemptions to Section 8 companies, read 26 Oct 2026, https://indiacode.gov.in/items/965bbc5f-f41b-49df-a492-349d30b01db1
- India Code, MCA notification G.S.R. 584(E) of 13 Jun 2017, amending G.S.R. 466(E), read 26 Oct 2026, https://indiacode.gov.in/items/beb1a1d9-4a3d-4943-ba29-612eb5a58e11
- Reserve Bank of India, Master Direction on Foreign Investment in India (updated up to 15 Jun 2026), read 26 Oct 2026, https://www.rbi.org.in/Scripts/BS_ViewMasDirections.aspx?id=11200
- Reserve Bank of India, Master Direction on Establishment of Branch Office, Liaison Office or Project Office in India by foreign entities (updated as on 18 May 2021), read 26 Oct 2026, https://www.rbi.org.in/Scripts/BS_ViewMasDirections.aspx?id=10404
- India Code, The Foreign Contribution (Regulation) Act, 2010 (as amended), read 26 Oct 2026, https://indiacode.gov.in/items/e62ef217-2250-4380-935c-d9ad915454b1
- India Code, Foreign Contribution (Regulation) Rules, 2011, read 26 Oct 2026, https://indiacode.gov.in/items/c7ce88a1-a2c1-4e5c-a5a8-937e71ab6f08
- Income Tax Department, FAQs and Guidance Notes on Forms as per Income Tax Rules, 2026, read 26 Oct 2026, https://www.incometaxindia.gov.in/faqs-and-guidance-notes-on-forms-as-per-income-tax-rules-2026
- Income Tax Department, Guidance note on Form No. 104, read 26 Oct 2026, https://www.incometaxindia.gov.in/documents/d/guest/fn-104
- Income Tax Department, Guidance note on Form No. 105, read 26 Oct 2026, https://www.incometaxindia.gov.in/documents/d/guest/fn-105
- India Code, Companies (CSR Policy) Amendment Rules, 2021, G.S.R. 40(E) of 22 Jan 2021, read 26 Oct 2026, https://indiacode.gov.in/items/a53eeda5-a9f3-4571-b1c4-877fc1280c74
- India Code, The Indian Trusts Act, 1882, section 1, read 26 Oct 2026, https://indiacode.gov.in/items/06b78ca2-c0bd-42b9-b82b-9909c5076814
- India Code, The Societies Registration Act, 1860, section 20, read 26 Oct 2026, https://indiacode.gov.in/items/20fa43d8-bacb-4c35-b0c3-bde15095a73e

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