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Section 25 companies under the companies act 1956 are companies formed for promoting commerce art science religion charity or any other useful object.
What is section 25 company in india. A section 25 company is registered under section 25 of the companies act 1956. Though the purposes for which such a company is formed is clearly laid down in sub section 1 of section 25 and are majorly charitable purposes. This section provides an alternative to those who want to promote charity without creating a trust or a society for the purpose.
10g to the commissioner of income tax for such registration. If a section 25 company gets itself registered under section 80g then the person or the organization making a donation to the ngo will get a deduction of 50 from his its taxable income. Section 25 company is regarded as a company within the meaning of the income tax act 1961 and as such its income is taxable according to the applicable rates similar to those applying to other companies.
Section 25 companies are those companies which are formed for the sole purpose of promoting commerce art science religion charity or any other useful object and have been granted a license by the central government recognizing them as such. The company has to apply in form no. Section 25 companies are non profit companies are granted license and registered as any other company and may be a public or private company.
Section 25 company in india. Step 7 registration under section 80g.
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