Section 8 Company for Religious Organisations

In short: a church, ministry or other faith-based group can register as a not-for-profit company under section 8 of the Companies Act, 2013, because "religion" is one of the objects that section names. On 4 November 2026 the Registrar granted a Section 8 licence to a Bengaluru faith-based foundation we incorporated, a week after the SPICe+ application was filed.

Most religious organisations in India still run as public trusts or registered societies. A Section 8 company is a stronger choice for groups that run schools, hostels, care homes, medical camps or welfare programmes alongside worship, and that want audited governance that donors and banks can rely on. This note explains what the law allows, where the tax limits lie, how to draft the objects, and what the ROC looks for.

Religion is an expressly permitted object. Section 8(1) lets the Central Government license an association as a company if it meets three conditions:

• Its objects include "the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object".
• It intends to apply its profits, if any, and other income only to promote those objects.
• It intends to prohibit the payment of any dividend to its members.

The power to grant the licence has been delegated to the Registrar, and new licences are issued by the Central Registration Centre along with incorporation. The licence carries standing conditions that bind the company for life:

• Income and property are applied solely to the objects in the memorandum of association (MOA).
• No dividend, bonus or other benefit goes to members, except out-of-pocket expenses, reasonable interest on loans and reasonable rent.
• Officers and staff who are not members can be paid prudent remuneration for services actually rendered.
• The MOA and articles of association (AOA) cannot be altered without the Registrar's prior approval.
• The company can amalgamate only with another Section 8 company having similar objects.
• The licence can be revoked if the company breaches section 8 or the licence conditions, or is run fraudulently or against public interest.

Section 8 company, trust or society. A Section 8 company takes longer to set up and has more filings than a trust or a society, but it is the only one of the three governed by a central law with uniform rules across India:

• Governing law: a Section 8 company is governed by the Companies Act, 2013; a public religious or charitable trust by State public trust law; a society by the Societies Registration Act, 1860 or the State Act.
• Registration: the company is registered online with the Registrar of Companies; a trust with the Sub-Registrar or Charity Commissioner; a society with the State Registrar of Societies.
• Founders: a private Section 8 company needs two members; a trust needs a settlor and usually two trustees; a society usually needs seven members.
• Legal status: the company is a separate legal person with perpetual succession; a trust has no separate legal personality and its property vests in the trustees.
• Liability: members' liability in a company limited by guarantee is capped at the guarantee amount; trustees can be personally liable.
• Changing the rules: changes to the MOA or AOA need the Registrar's prior approval; changes to a trust deed often need court or Charity Commissioner approval.
• Public record: a Section 8 company's filings and audited accounts are on the MCA register, which donors, banks and partner institutions can verify.

For a congregation that only holds worship services, a trust or society may be enough. Once the group runs institutions, employs staff, receives CSR or foreign funds, or expects leadership to change over generations, the company form is worth its extra compliance.

Benefits for a religious organisation:

• Continuity across generations: the company survives changes in pastors, elders and members, and property stays with the company, not with individuals.
• Limited liability: in a company limited by guarantee, a member's liability is capped at the guarantee amount, often ₹1,000, and no share capital is needed.
• No "Limited" in the name: the organisation can use names such as "… Foundation" or "… Ministries".
• Credibility: the MCA register, audited accounts and board minutes give donors and banks a record they trust.
• Access to funds: a Section 8 company can register for income-tax exemption and donor-deduction approval, enrol as a CSR implementing agency for its charitable programmes, and apply for FCRA registration.
• Lighter compliance than other companies: Section 8 companies have notified exemptions, such as holding board meetings only once every six months.

Income-tax: religious purposes, charitable purposes and donor deductions. The company form does not by itself make income tax-free. From 1 April 2026 the Income-tax Act, 2025 deals with non-profits as registered non-profit organisations (RNPOs), and the old section 12A/12AB and 80G rules have moved to new sections. Based on published summaries of the new Act:

• Registration: sections 332 and 333 (formerly 12A/12AB) cover Section 8 companies with charitable or public religious purposes. Income is exempt only once registered, so apply soon after incorporation.
• Application of income: 85% of income must be applied to the objects or accumulated (sections 336 and 341 to 343).
• Benefit of one community: applying income for the benefit of a particular religious community or caste is a specified violation (section 351). Keep charitable work, such as education, health and relief, open to all.
• Private religious purposes: applying income for private religious purposes is also a violation. Worship and programmes should be open to the public, not to a family or closed group.
• Donor deduction (formerly 80G): approval under section 354 is not available to an organisation for a particular religious community, and religious spending must stay below 5% of income. A mainly religious organisation will get exemption but not donor deduction; a mainly charitable one with limited religious activity can get both.
• Donations for repair of places of worship: treated as deemed corpus (section 340).

Decide at the start whether the organisation is mainly religious or mainly charitable with a religious character, and draft the objects and the budget to match. Companies cannot count spending on religious activity as CSR, but a faith-based Section 8 company can receive CSR funds for its education, health and welfare programmes. Confirm section numbers against the Income-tax Act, 2025 and the Income-tax Rules, 2026 before relying on them.

Foreign contributions (FCRA). A newly incorporated faith-based company cannot receive foreign donations until it holds FCRA registration or prior permission from the Ministry of Home Affairs. Religious programmes are a recognised category under the Foreign Contribution (Regulation) Act, 2010, so the purpose itself is not a bar:

• Registration is open only to organisations with a record of work and spending over some years; a new company usually starts with prior permission for a specific grant from a named donor.
• All foreign contributions are first received in the FCRA account at State Bank of India, New Delhi Main Branch.
• Foreign contribution cannot be passed on to another organisation.
• Only a limited share can be spent on administrative expenses.

Drafting the objects clause. The objects decide the tax position, CSR and FCRA eligibility, and how smoothly the licence is granted. Keep the main objects (clause 3(a)) short and specific, typically covering:

• Advancement of religion: places of worship, prayer and retreat centres, religious meetings and conventions.
• Theological training: Bible colleges or seminaries, and training of pastors and religious workers.
• Education: schools, vocational and skill centres, libraries and scholarships.
• Healthcare: clinics, dispensaries and medical camps for the public.
• Care institutions: children's homes, old-age homes, shelters and rehabilitation centres.
• Relief of the poor and community development.

Add a proviso that the charitable objects will be carried on for the public without discrimination on the basis of religion, caste, creed, gender or nationality. Put the enabling powers, such as accepting donations (foreign contribution only under FCRA), acquiring property and employing staff, in clause 3(b). Avoid the word "degrees" (only a university can award them), do not allow activities abroad when clause 4 says the objects extend to the whole of India, and make sure the physical MOA, the e-MOA (INC-13) and AGILE-PRO-S read the same.

The incorporation process. The licence and the certificate of incorporation are now granted together through SPICe+ on the MCA V3 portal:

• 1. Digital signatures and MCA business user logins for every subscriber and proposed director.
• 2. Name reservation through SPICe+ Part A (RUN).
• 3. Drafting the MOA (INC-13), the AOA (INC-31, usually Table H for a company limited by guarantee) and the Section 8 statements.
• 4. Signatures of subscribers, directors and a witness on the documents and declarations.
• 5. SPICe+ Part B with the linked forms: e-MOA, e-AOA, INC-9 and AGILE-PRO-S.
• 6. Digital signing, professional certification, stamp duty and filing.
• 7. ROC review, resubmission if remarks are raised, and issue of the certificate of incorporation and the Section 8 licence.

The documents usually needed are the estimate of income and expenditure for the next three years and the statement of assets and liabilities (both signed by all proposed directors), the declaration of a practising professional in INC-14, a declaration in INC-15 from each applicant, each director's interest in other entities, identity and address proofs (address proof not older than two months), and the owner's NOC with a recent utility bill for the registered office.

Common ROC remarks and how to avoid them. In our recent filing the ROC raised two remarks, and the licence followed a day after we resubmitted:

• Estimate of income and expenditure not specifying sources and objects: show each source of income and each expenditure head against its object clause in the MOA.
• Estimate not signed by all directors: keep it to one page, or have every director sign every page.
• Attachment not visible: check every attachment in the downloaded form before signing, and use plain image-based PDFs.
• Names differing across forms: enter names exactly as on PAN in Part B, the e-MOA and the e-AOA.
• Address proof older than two months: collect fresh proofs just before filing.

After incorporation. A Section 8 company is excluded from the small-company category, so it files the full annual return. The first auditor is appointed by the Board within 30 days (section 139(6)); the registered office is filed in INC-22 within 30 days if not given at incorporation; board meetings are held at least once every six months; the AGM is held within six months of the year-end (nine months for the first); AOC-4 is filed within 30 days and MGT-7 within 60 days of the AGM; and any change to the MOA or AOA needs the Registrar's prior approval.

Frequently asked questions

Can a church or religious organisation register as a Section 8 company? Yes. Section 8(1)(a) of the Companies Act, 2013 lists religion among the objects for which a licence may be granted. The company must apply its income only to its objects and must not pay any dividend to its members.

Will a religious Section 8 company get income-tax exemption? It can, once registered as a registered non-profit organisation under the Income-tax Act, 2025 (formerly section 12A/12AB). Income applied for the benefit of a particular religious community or caste, or for private religious purposes, is treated as a violation.

Can donors claim a tax deduction? Only if the organisation gets donor-deduction approval (formerly section 80G). That is not given to an organisation for a particular religious community, and religious expenditure must stay below 5% of income.

How long does registration take? With documents ready, the SPICe+ filing takes a few days and the ROC's review usually one to two weeks. In a recent case the application was filed on 28 October 2026, resubmitted on 3 November 2026 and licensed on 4 November 2026.

Getting it right from the first draft. A Section 8 company gives a faith-based organisation a permanent legal home, limited liability and a governance record that donors trust. The licence depends on three things: objects that are clearly religious or charitable, a budget tied to those objects, and documents that match each other across every form. For help with the structure, documents and filing, see our Section 8 company registration service or book a consultation.

This note is general information as on 4 November 2026, not legal or tax advice. The Income-tax Act, 2025 and FCRA rules change often; check the current law before acting.