Parameter

Trust

Society

Section 8 Company

Meaning

It is considered to be the oldest form of charitable organisations. It is, in essence, an arrangement between parties whereby one party holds ownership over property on behalf of another person

It is formed when a collection of people come together for a common charitable purpose. But it is not limited to charitable purposes but may extend to multiple other fields.

A company established with objects of promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object and apply any profits into furthering the objective.

Regulated By

Private Trusts are governed by the Indian Trust Act, 1882. Public Trusts are governed by respective Trusts Acts of the state where these are established

The State Acts are applicable for state level Societies, whereas, for the societies operating all over India, the Societies Registration Act, 1860 is applicable

Governed by the Indian Companies Act, 2013

Registering Authority

Deputy Registrar of the state

Registrar or Deputy Registrar of the particular state in which it is to be registered.

Registrar of Companies (ROC) or Regional Director

Registered as

NGO/NPO

NGO/NPO

NGO/NPO.

They also enjoy all the privileges of a limited company Without add Pvt. Ltd. to the name.

Section 8 Company Name must end with the words like foundation, forum, association, federation, chambers, confederation, council, electoral trust, etc.

Constitution Documents

Trust Deed

MOA and rules and regulations

MOA and AOA

Minimum members required

2 trustees minimum

7 members minimum

(5 for Jammu and Kashmir and Telangana)

2 directors and 2 shareholders.

(The directors may also be the shareholders)

Management

Managed by Trustees

Managing Committee or Governing Council

Board of Directors

Change in Management

As per Provisions of the Trust Deed

As per Society Rules and MOA

As per AOA

Change in Reg Address

Difficult

Difficult

Easy

Process /Documentation

Physical

Physical

Online

Annual compliances

No Specified mandatory yearly compliance. General Compliance which required by An Assessee in Income tax.

The society must file the list of names, occupations and address of the managing committee members of the society to the Registrar annually

The company must file the annual returns and accounts with the ROC.

Audit

Mandatory for Only Public Trust

As per Society Regulations

Mandatory As per Companies act

Remuneration

Not Allowed -Trustees

Allowed-Member

Allow only in case of profit

In Good Faith No Limit for Remuneration to  Employees.

Audit under IT Act

Mandatory If Obtained 80G/12A

Mandatory If Obtained 80G/12A

Mandatory If Obtained 80G/12A / Turnover exceeding tax audit limit

Grants and subsidies from the government

Preferred less

Preferred less

High Preferable

Preference for Foreign Contribution

Low preference

Low preference

Most Preferred

Reg. Under IT Act for 80G/12A

Allowed

Allowed

Allowed

Transparency

Low

Low

Very High

Property Ownership

Trust

Society

Company

Cost Factor

Low

Low

Little High in Compare to Other

Reg./Formation Time

10-20 Days

20-30 Days

7-15 Days

Stamp Duty on constitution

Non-Judicial Stamp duty Based on Total worth of Property/trust

Non-Judicial Stamp duty- as per the Stamp Act of the concerned state.

According to Authorised Capital

Dissolution

Except a Public Charitable Trust, all trusts can be dissolved on grounds mentioned in the Trusts Act

May be dissolved with the approval of 3/5th members of the society

Companies can be wound up following the conditions and procedure prescribed under the Companies Act