EASE OF FORMATION

A Section 8 company can be formed by two persons only, by complying with the prescribed formalities of the Companies Act. Many privileges and exemptions under Company Law. Registered partnership firm can be a member in its own capacity.

LIMITED LIABILITY

The greatest benefit of Section 8 Company is limited liability. If any liability arises then its member is not personally affected; members are only liable for unpaid shares held by them and not more than that. Being the biggest advantage with this type of company, it means that the owners are not personally responsible for business debts and obligations of the incorporation.

SEPARATE LEGAL ENTITY

This is the most prominent quality of a Section 8 Company. It refers to the statement that company and its members are completely distinctive. The biggest advantage of a section 8 company is that its identity is distinct from that of its members. A company is a separate person having its own rights & Obligations.

PREFERRABLE CHOICE FOR CORPORATES FOR CSR

As Big Companies have to compulsorily invest in NGO as part of CSR activities, Due to the National level Registration &  More Transparency , Big Companies & donor prefers to invest in Sec 8 Company

GREATER FLEXIBILITY

A Section 8 company is required to perform lesser legal formalities as compared to a public company. It enjoys special exemptions and privileges under the company law.

PERPETUAL SUCCESSION

Death, insolvency and insanity etc of any of the member does not affect the continuity of the company. Thus the life of the company does not depend upon the life of its members. In case of death of the owner or transfer of shares, your business won’t get affected. There will be no effect on firm’s continuance.

TAX BENEFITS

A Section 8 company is not required to publish its accounts or file several documents. Therefore, it is in a better position than a public company to maintain business secrets.