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Section 8 - can the tenant run a business from the house?
We are under contract on a property with an existing tenant that has another 10 months on their lease with a HAP contract. I am unfamiliar with section 8 and we have never owned a property with a HAP contract, looking for some experts.
The seller has only provided us with the HAP contract and no additional lease. Is there supposed to a a separate lease in addition to the HAP contract? Would the lease define if we permitted to make changes to the property if the tenant is still occupying the property, if the tenant permitted to run a home business from the property, or is that all through the housing authority? I didn't get much information from the local housing authority and I'm needing some expertise, section 8 is new to us and we are planning to redevelop the property, rezone, etc and knowing that this lease has most of the year remaining, we need to know what to plan for.
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Can a Section 8 Company Do Business?
Famous section 8 companies in india belong to some of the biggest business people. can section 8 companies do business now, know more about it..
Infosys Foundation, Reliance Foundation, TATA Foundation, and Reliance Research Institute are some of the examples of Section 8 companies registered under the Act.
A firm is called Section 8 Company when it is enrolled as a non-profit organisation (NPO) and has the motive of benefiting arts, commerce, education, charity, protection of the environment, sports, science, research, social welfare, religion and plans to use its earnings or other revenue for achieving these goals.
The revenue of NPO can not be used for paying out profits to the firm’s partners and has to be used for the welfare of the society. Such corporations collect an incorporation certificate from the central government and are accountable and will stick to the regulations defined by the government.
Followed by the regulations, loss to acceptance of the commitments provided by the central government may direct companies to close companies
What Is a Section 8 Company?
Section 8 company is a company that is licensed under Section 8 of the Companies Act, 2013. It is a non-profit organisation that is constructed to propel commerce, arts, science, sports, education, research, etc. The revenue of such categories of corporations is applied towards the development and no income is spent on any of their partners.
Can Section 8 Companies Do Business?
Yes, a Section 8 Company can be transformed into any other company including One Person Company (OPC) as described under Section 8(4)(ii) read with Rules 21 and 22 of Companies (Incorporation) Rules, 2014. However, It is further subjected to restrictions and the compliances as per other applicable laws including Income Tax Act, 1961.
- Initially such public limited or private companies need not have the words “limited” or “ private limited ” in their names though they acquire the status of a corporation with restricted liability
- The fee structure is the next procedure for registration of such firms as well as having an account of documents is very concessional
- Such firms do enjoy certain protection and freedoms from several requirements of the Act as permitted under notification no. GSR 466(E) dated 05 June 2015 and the notification no.GSR 584(E) dated 13 June 2017 published by the Ministry of Corporate Affairs (MCA).
Advantages of Section 8 Companies
Distinct identity.
The trust company or a society company that operates under a Section 8 company is a legal body with a different validity apart from its managers and shareholders recognised under the law. It can own assets and incur obligations in its name. The state government status of a Section 8 company gives several benefits in improving its goal and more greatly the ownership in the firm can be facilitated by the transfer of shares and corporate restructuring techniques can be committed for the union.
Liability Is Limited
Because of limited liability status, the partners of such a firm have no liability towards the firm’s obligations because the firm and partners are deemed as separate individuals as per the law, the firm is identified as an artificial juridical individual. The company partner’s liability at the best can only expand to any outstanding value of the percentages they have accepted.
Tax Benefits
Section 8 companies can get enrolled under Sections 80G and 12A of the Income Tax Act , 1961 subject to fulfillment of acceptable situations. Thus, a Section 8 company is capable to obtain contributions related to trust and pertain to the same in the furtherance of its subjects. Section 8 companies also enjoy stamp duty settlements for their arrangement and enrollment of assets in certain States.
Corporate Social Responsibility (CSR)
CSR projects are recognised as capable implementing dealers through which CSR acceptable firms can accomplish their CSR spend goals. If a Section 8 company is organised by a company to which CSR requirements are adequate, and if such Section 8 company were to be utilised as implementing dealer. A Section 8 company is expected to have enrolled under Section 12A and Section 80G of the Income Tax Act to be suitable for a CSR execution agency.
In such Section 8 companies are expected to document form CSR-1 with MCA and collect CSR registration number before it rectifies CSR programs on or after 01 April 2021. The rules also enable Section 8 firms to carry properties established out of CSR payments given by firms for use to further CSR goals.
The Statutory Obligation of Section 8 Company
- The income and excess developed by the firm from its company systems should be utilised only for accomplishing the purposes of the company
- Nominating a Company assistant is not necessary for Section 8 companies
- Incentives and increments are not authorised in Section 8 company
- Section 8 companies can perform annual general meetings on a short time note
- Without the previous authorisation of the central government, the purpose of the Section 8 corporation cannot be modified
- The revenue of a Section 8 company is tax-free if the corporation has attained 80G and 12A enrollment
- Managers of the corporation can achieve positions in more than 20 firms. There is no minimum share engagement investment for the capital requirement in Section 8 of company incorporation .
How Vakilsearch Can Help You Register Section 8 Company?
Registering a company under section 8 requires central government permission. The process is complex. However, experts at Vakilsearch can help you in registering a Section 8 Company online. Make sure to reach out to our experts for any queries. In Vakilsearch, we provide the easiest online Section 8 company registration in just three steps. Initially, experts will get in touch and address all your queries regarding entity selection and help you in choosing the appropriate one. Subsequently, they will help you to get the entire process completed and file the registration. Experts at Vakilsearch will provide complete support and handle all the formalities until your company gets registered. Reach out to our experts right now to get your Section 8 company registered.
- Benefits of Section8 Company Registration
- Forms and Purpose of a Section 8 Company
- Online Section 8 Company Registration: What Documents Are Required?
- Section 8 Company Requirements
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We are under contract on a property with an existing tenant that has another 10 months on their lease with a HAP contract. I am unfamiliar with section 8 and we have never owned a property with a HAP contract, looking for some experts
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Famous section 8 companies in India belong to some of the biggest business people. Section 8 company is a company that is licensed under Section 8 of the Companies Act, 2013