Annual compliance refers to the business entity's post-incorporation legal obligations to follow the established standards. Holding and preparing paperwork, filing annual returns, and the LLP's Statement of Accounts and Solvency would all be part of annual compliance.
Compliance for LLP is obligatory every year to ensure that an LLP continues its functioning in India and also to avoid fines. Given below is a detailed guide to the annual compliance package of LLP.
Purpose: This form is used in filing the annual financial returns of the LLP in which the Statement of Assets and Liabilities and the Statement of Income and Expenditure are included.
Deadline: Within 30 days from the end of six months of the financial year, typically by October 30th each year.
Details Required:
Statement of assets and liabilities
Statement of income and expenditure
Declaration on solvency by the partners
Filing Fees: ₹50 - ₹2,000, depending on the contribution.
Tax Audit: Required if turnover exceeds ₹1 crore in a financial year.
Audit of Accounts (if applicable)
Applicability: The auditor’s report must be mandatory if the turnover of the company during the preceding year has been more than ₹40 lakh or the contribution of the company during the preceding year has been more than ₹25 lakh.
Auditor’s Report: Required to be filed with the Registrar of Companies (ROC).
Other Compliances
Maintenance of Statutory Registers: Maintaining records of all partners, contributions, and agreements.
Minutes of Meetings:Record minutes of partner meetings, particularly those involving financial decisions.
Penalties for Non-Compliance
Late Filing Fees: Any extension of filing of Form 8 and Form 11 attracts a fee of ₹100 per day per form.
Income Tax Penalties: Interest for late filing of income tax returns is up to ₹5,000 together with the interest on the amount of tax.
Deactivation of LLP: Any repeated failure to comply with the LLP laws will lead to the clsring of the LLP and the partners may be barred.
Components of an Annual Compliance Package
At Insta Bizfilings, we provide an annual compliance package for LLPs which includes the following:
Annual Return and Form 8 (Statement of Accounts & Solvency)
Preparation of the balance sheet
Declaration on solvency
Filing with the ROC
Filling out Form 11 as per the Act
Gathering of information related to partners and contribution
Filing with the ROC
Income Tax Return Filing (ITR-5)
It has been found that majority of people treat the preparation of income tax returns as one of the most significant and their most sensitive activities.
Tax computation and filing
If there is a reference to an audit, a detailed report regarding the audit will be prepared.
Dealing with amendments and changes to statutory registers
Taking and writing of minutes and resolutions
LLP compliance audit and health check up
Consultation and Advisory
On compliance issues, there should be update frequently.
Offer tax consultancy with a special focus on planning and compliance
Estimated Costs for Annual Compliance
Basic Compliance Package: ₹10,000 - ₹20,000 per annum (includes Form 8, Form 11, DIR-3 KYC for Partners, and ITR filing for small LLPs).
Advanced Compliance Package: Around 2, 000 to 3, 000 rupees annually (the package is inclusive of audit, tax planning, and additional advisory services).
Penalties for Late Compliance: ₹100 per day for ROC forms, potential penalties for late tax filing.
Why Opt for an Annual Compliance Package?
Cost-Effective: One way through which bundling of services has been found to achieve the objectives is through cutting overall compliance cost.
Expertise:Another assurance given by the compliance professionals is that the compliance is precise and on time to avoid such penalties.
Peace of Mind: Best practices involve the use of checklists and frequent notifications and messages in order to ensure that no compliance need is forgotten.
Key Points to Consider
Audit Requirement: Make sure you check whether your LLP goes beyond the regulations of threshold of audit.
Filing Deadlines: Make sure to remember its important dates for fees payment which are May 30, July 31, September 30 and October 30 to prevent charges.
Professional Help: Hiring a professional for once a year compliance is helpful because it certifies someone knowledgeable makes sure that every regulation is fulfilled adequately.
Why Choose Instabiz Filings
Our goal at InstabizFilings is to make business solutions more affordable and easily accessible to everyone in India. We have a seasoned group of experts on hand to help you at every stage of your business venture. Having worked with companies of all sizes, from startups to multinational enterprises, for more than 40 years of collective experience, we are experts at streamlining the compliance process and making it less burdensome for business owners.
Our objective is to make expense reports less painful so you can focus more on the expansion of your company, even though we will guarantee timely filings and provide informed advice to help you avoid fines and stay on top of regulations. With InstabizFilings, you might benefit from a streamlined, stress-free compliance process that will keep your company operating efficiently.
Are you set to simplify your annual filings? Get started with InstabizFilings today!
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FAQs
Annual Compliance for an LLP (Limited Liability Partnership) refers to the mandatory filings and legal requirements that an LLP must complete every financial year under the LLP Act, 2008. These compliances ensure the LLP remains legally active and avoids penalties.
Every LLP must file:
Form 11 (Annual Return) – details of partners (due by 30th May)
Form 8 (Statement of Account & Solvency) – financial position of LLP (due by 30th October)
In addition, LLPs must file Income Tax Return every year.
Yes. Even if the LLP is inactive or has nil transactions, it must still file Form 11 and Form 8. Non-filing leads to heavy penalties per day of delay.
Late filing of Form 8 or Form 11 attracts a penalty of ₹100 per day per form with no maximum limit. Continuous default can also lead to disqualification of designated partners and legal action.
Commonly required documents include:
LLP agreement
Details of partners/designated partners
Financial statements (balance sheet, P&L)
Turnover and capital contribution details
DSC of designated partners
These are used to prepare and file Form 8 and Form 11 with MCA.
