LLPs need to file their returns and statement of accounts annually. Failing to comply with this can attract a penalty of up to Rs 5 lakh. Annual Compliance comprises.
How To File Annual Return For LLPs?
A Limited Liability Partnership business is required to file an Annual Return within 2 months of the closing of the financial year.The return needs to be filed with Form 8 and Form 11 with the Registrar of Companies (RoC).
What are Annual Filings? (Overview)
Limited liability partnerships (LLPs) are required to meet fewer criteria for compliance on filing annual returns, in comparison to private limited companies. LLPs are required to provide information related to the statement of accounts, and returns, on an annual basis. Penalties, however, are huge for failure to comply. Entities that don't provide the requisite information are fined heavily, with penalties that can go up to Rs. 5 lakhs.
LLP Annual Filing Compliances: Benefits
- Higher Credibility:Annual compliance provides for higher credibility to the organization for loan approvals or any other similar requirements.
- Record of Financial Worth:Annual compliance filings by LLP’s provide records to other companies regarding their financial worth, which may result in new and interested investors.
- Stays Active and No Penalties:With regular filings, LLPs are not declared as defunct, and stays active. Also, annual compliance filings are mandatory and hence involve penalties (additional fees) to LLPs, when they default on filings.
- Conversion or Closure:Regular annual compliance filings facilitate easier conversion of Limited Liability Partnerships into other types of companies, as well as quicker resolutions in case of dissolution of partnerships.
Checklist Items for LLP Annual Filing Compliances
- Annual returns need to be filed with the Registrar of Companies.
- Annual returns to be filed as per the prescribed format of LLP Form 11.
- This is required to be filed within 60 days from the close of the financial year, or the 30th of May of each year.
- The LLP annual compliance has to be met by each and every registered LLP even if there is no business activity. In fact, it has to be met even if the LLP has been closed down and whether or not a business bank account exists.
Important Requirements of LLP Annual Filing Compliance
For businesses to meet their annual compliance requirements, all it requires is for them to remain disciplined and vigilant. However, being callous can result in hefty fines and penalties. No to mention, LLPs that meet annual compliance requirements are often granted loans quicker or readily funded by investors, as these businesses are compliant with the requirements of the Registrar of Companies (RoC).
Regular Updates From The RoC (Registrar Of Companies)
With an on-call company secretary throughout the year, you can ensure that your business is run in accordance with the laws in force. Our team would keep you up-to-date on all the changes made by the RoC, throughout the year.
Documents Required for LLP Annual Filing Compliance Form 8 LLP
You must file the Form 8 inside 30 days from the completion of 6 months after a financial year ends. Two designated partners can sign this form digitally. Also, a company secretary/chartered accountant/cost accountant must certify the same. There are 2 parts in a Form 8 - Part A - The solvency statement Part B - Statement of expenditure & income, statement of accounts. For not filing the Form 8 on time, a penalty of Rs 100 per day will be imposed.
Form 11 LLP
This form contains details such as the total number of designated partners, details of partners along with details of body corporates as partners, contributions received by the partners and summary of all partners. All LLPs must file the Form 11 within 60 days after the end of the financial year, along with the fee prescribed. Therefore, the LLPs should file their Form 11 by 30th May every year. An LLP will not be allowed to close or wind up till it files all its annual returns. Therefore, all LLPs must file their annual returns on time, to avoid penalties.
FAQs on Annual Compliance Filings for LLPs
Yes, regardless of when an LLP is incorporated, it must file its annual return every year.
The consequences of non-filing Form 8 include penalties and legal consequences, as it is a mandatory filing requirement under the LLP Act.
The attachments to Form 8 include a statement of solvency, details of the designated partners, and a list of partners.
Form 8 must be authorised by two designated partners of the LLP.
The due date for filing the Statement of Accounts and LLP return is 30 May of every financial year.
The consequences of non-filing Form 11 include penalties and legal consequences, as it is a mandatory filing requirement under the LLP Act.
Yes, ROC filing is mandatory for LLPs, as they are registered with the Ministry of Corporate Affairs (MCA) and must comply with the rules and regulations set by the Registrar of Companies.
The due date for LLP annual filing is 30 May of every financial year.
The penalty for not filing the LLP Annual Return on time is ₹100 per day of default, subject to a maximum of ₹5,000. Additionally, the LLP may also face legal consequences for non-compliance with the LLP Act.