What is an NGO? Non-profits in India explained

An NGO, or non-governmental organisation, is a private organisation that works for a public purpose and doesn’t share its profits with the people who run it. It might run a school, a clinic, a women’s collective, an animal shelter or a legal aid centre. What makes it an NGO is that it is independent of government and that its money goes to its cause, not to its owners.

In India, though, “NGO” isn’t a legal category. There is no NGO Act and no NGO registration. When people say they want to “register an NGO”, they mean setting up one of three legal forms: a public charitable trust, a registered society or a Section 8 company. The form decides which law the organisation follows, who controls it and which office it registers with.

This guide explains the forms an NGO can take, what “non-profit” requires, how NGOs are funded, how many there are and the registrations that matter.

What “NGO” means

“NGO” describes organisations that are neither government nor business. “Non-profit organisation” (NPO), “voluntary organisation” and “charity” mean much the same in everyday speech.

The law uses its own words, and they matter because each one comes with rules:

So one organisation can be “a registered society” to its registrar, “a registered non-profit organisation” to the Income Tax Department and “an implementing agency” to a CSR team, all at once.

The three main legal forms

Nearly every NGO in India takes one of three forms.

A trust is created when a person, the settlor, hands property to trustees to hold for charitable purposes. The Indian Trusts Act, 1882 covers private trusts, such as family trusts, but its section 1 says it doesn’t apply to religious or charitable endowments, so public charitable trusts depend on state laws where they exist and on their deed everywhere else. A society is a membership body: under the 1860 Act, seven or more people can form one by signing a memorandum of association and filing it with the registrar. A Section 8 company promotes objects such as education, social welfare or charity, must apply its income to them, can’t pay dividends and works under a government licence.

All three can do charitable work, get the same tax registrations, register for CSR and, with permission, receive foreign money. They differ in control, paperwork and how easy they are to change. Our guide to choosing between a trust, a society and a Section 8 company compares them in detail, and there are step-by-step guides to registering a trust, a society and a Section 8 company.

Other kinds of organisation

Some groups that do social good aren’t NGOs in the legal sense, or aren’t non-profits at all:

• Informal groups. A residents’ group or a blood-donor network can do valuable work unregistered, but with no founding document it can’t get tax registrations, donor deductions, CSR funding or FCRA registration.
• Cooperatives and producer companies. These are owned by their members and exist for their members’ benefit, so they can share surpluses among members. That makes them member businesses rather than non-profits.
• Social enterprises. A company or limited liability partnership that earns money by selling goods or services, often with a social mission. It can pay its owners, so it gets no charitable tax status and can’t act as a CSR implementing agency.
• Bodies set up by governments. Many government programmes run through societies or Section 8 companies. They have an NGO’s legal form, but the government controls them.

What “non-profit” really means

Non-profit doesn’t mean an NGO can’t earn money, can’t pay anyone or must spend every rupee by 31 March. It means that the organisation’s income and property can only be used for its objects, and can never be handed to the people who founded or control it. Each form writes this in its own way:

• A Section 8 company must apply its profits or other income to its objects and can’t pay dividends to its members (Section 8(1)).
• When a society is dissolved, its remaining property can’t be paid to its members; it must go to another society (section 14 of the 1860 Act).
• A trust must hold its property under an irrevocable trust for charitable purposes, or the Income-tax Act won’t register it (Section 332(2)).

Within that rule, an NGO can pay staff, including a founder who works full time, a fair salary for real work. It can charge fees and sell products, within limits on business activity (see when a charity can earn). And it can end a year with a surplus, as long as it applies enough of its income to its objects.

Payments to insiders get the closest attention. Under the Income-tax Act, 2025, income used for the benefit of a “related person” (the founder, trustees and managers, large donors, and the founder’s and trustees’ relatives and businesses) is taxed at 30%, and can cost the NGO its registration. Our guides to the 85% rule and the NGO board explain both rules.

How NGOs are funded

Most NGOs draw on several sources. Each comes with its own conditions:

How many NGOs are there in India?

There is no single national register: each form registers with a different office, and trusts and societies with different offices in each state. The best official count is NGO Darpan, the portal run by NITI Aayog: more than 5 lakh non-profits had signed up, according to NITI’s annual report for 2025-26, published in May 2026.

Treat that as a rough guide. NGOs that don’t seek government money may never sign up, and a sign-up doesn’t mean an organisation is still active. Figures quoted online vary wildly, so use official counts with their dates. The count of CSR implementing agencies is older: 17,130 had registered on Form CSR-1 by 31 October 2021, according to the MCA, and we haven’t found a newer official figure.

The registrations an NGO may need

Creating the trust, society or company is only the first step. These are the registrations most NGOs collect over their first few years:

Some NGOs also need a TAN (to deduct tax at source from salaries, rent or contractors), GST registration (if they sell goods or services above the thresholds) and registrations as an employer. Our first-year checklist puts them in order, and income-tax registration for NGOs explains the tax steps in full.

What registration doesn’t mean

None of these registrations is a stamp of quality. A registration certificate shows that an organisation exists, a tax registration that it is eligible for an exemption, and a CSR-1 number that it is eligible to be an implementing agency. The affidavit NGOs sign when they join NGO Darpan says plainly that registration on the portal isn’t proof of an organisation’s authenticity or legality.

That is why funders do their own checks. If you run an NGO, see the documents CSR teams ask for; if you fund one, see choosing an NGO partner.

Thinking of starting one?

A registered NGO brings a board that must meet, audited accounts and filings every year for as long as it exists. You could start by running your programme as a project of an existing NGO, with a written agreement on who owns the work, the money and the data. Register when the work has run for a while, people outside your family will serve on the board, and someone will keep the accounts. The Academy’s Starting an NGO course walks through the whole journey.