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Mandatory Compliances for an Limited Liability Partnership (LLP)

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Keep your limited liability partnership from being a defaulter by following just little compliance as “Prevention is always better than Cure”.

Every LLP after its incorporation with MCA should take care of certain compliances and practical aspects associated with it. One of the important legal factors associated with LLP or any business is to follow the mandatory compliances declared under the relevant Act or Law. Every LLP needs to follow little mandatory compliance so as to avoid the future penalties or adverse consequences.

The mandatory compliances which any LLP needs to follow are stated as below:

  • Filing the Annual Return with MCA
  • Filing the Statements of the accounts or Financial Statements
  • Filing the Income Tax Returns
  • Annual Return:

The Annual Return of the LLP is to be filed in the prescribed format i.e. Form-11 with MCA. The stated form provides information regarding the Partners of the LLP. Any change in the partners or the management of the LLP during the reporting period is to be intimated in the aforesaid form so the Ministry should have the updated information regarding the Partners/ Designated Partners of the concerned LLP. The stated form is filed on MCA portal within 60 days from the closure of the financial year ending on 31st March. Hence the due date of filing of the same is 30th day of May following the Financial Year end.

  • Statement of Account & Insolvency:

Form- 8 deals with filing the Statement of Account & Insolvency of the LLP. Like every business, it is also mandatory for the LLP to maintain books of accounts and financial statements. The accounts required to be furnished before the Ministry every year in the form mentioned above along with the necessary details and information asked in the prescribed format. Further, Statutory Audit is mandatory in case the annual turnover exceeds Rs 40 lakh or contribution exceeds 25 lakh rupees. The form has to be filed before 30th October every year before with MCA.

All the forms mentioned above shall be filed with MCA within the due dates irrespective of the fact that the LLP has not started any business or have not done any taxable event or a single transaction in its name.

The requirement of above forms is provided under the LLP Act, 2008 and allied rules. In addition to same, filing of Income Tax Return is mandatory under Income Tax Act, 1961., which is explained as under.

  • Income Tax Returns:

Every LLP requires filing the Income Tax Returns after the end of every financial year. The same is to be filed on or before the due dates prescribed under the Act, which are as follows:

  • 31st July – For the LLP whose accounts are not subject to Audit under any Law.
  • 30th September – For all the LLP whose accounts are subject to Audit under any Law.

All the requirements mentioned and explained above are necessary to be complied with as non-compliance leads to heavy penalty on daily basis under the LLP Act, 2008.

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