Q. What other licenses are required for section 8 company to claim tax exemption?

Section 8 company registration is the first step to start your NPO/NGO in India. It does not provide you any tax exemption. Tax exemption is given by Income Tax Act, 1961. The two important registration required for tax exemption are as follows:

• Section 12AA Registration to exempt the income of the Company: To claim any exemption under the income tax act, you need to register under the section 12AA registration. Once registered, you need to comply with the provisions to avoid any scrutiny by the tax department.
• Section 80G Registration to provide exemption to the donors: This is a one step ahead registration. If you are registered under section 80G, then any person donating to your company can also claim the exemption in his IT return.
• FCRA Registration: In case you want to claim the donations from the foreign country, then you need to take registration under FCRA Act. However, to be eligible to take the foreign donations/contribution you should be atleast 3 years old company or you should apply for prior permission.