A Limited Liability Partnership (LLP) is a combination of partnership and a Company. Under LLP the partner liability is limited to the amount they invested in Business.
LLP compliance refers to the legal and regulatory requirements that LLPs must fulfill to maintain their status and stay in good standing with the government.
These requirements typically include filing annual returns, maintaining proper accounting records, and holding annual meetings
list of annual compliance required by LLP
Every Designated Partner (DP) of an LLP must have a unique Director Identification Number (DIN) and undergo an annual KYC (Know Your Customer) process to ensure that their personal details are up-to-date The due date for DIN KYC is Sept, 30th of each year.
Annual Return Filing
the Annual Return must be filed within 60 days of the end of the financial year, and failure to do so can result in penalties and fines, the list of documents required are:
- Prepare the LLP’s financial statements: The LLP must first prepare its financial statements, including the balance sheet, profit and loss account, and statement of changes in equity.
- Get the LLP’s accounts audited: If the LLP’s turnover exceeds Rs. 40 lakhs or its contribution exceeds Rs. 25 lakhs, the accounts must be audited by a CA.
- Obtain digital signature certificates: The designated partners of the LLP must obtain Digital Signature Certificates (DSC) for signing and filing the Annual Return.
- File Form 11: The LLP must file Form 11 with the Registrar of Companies (ROC) providing details of the LLP’s partners, their contributions to the business, and changes in the LLP’s structure, if any, during the year.
- Attach required documents: Along with Form 11, the LLP must attach various documents, such as the LLP agreement, MSME declaration, details of the LLP’s designated partners, and details of any changes in the LLP’s partners during the year.
Pay the fees: The LLP must pay the prescribed fees for filing the Annual Return, which depends on the LLP’s contribution and turnover.
Documents required for filing the Annual Return of an LLP:
- Balance Sheet
- Profit and Loss Account
- Statement of Changes in Equity
- Auditor’s Report (if applicable)
- LLP Agreement
- Details of LLP’s partners, including changes during the year
- Details of LLP’s designated partners
- MSME declaration
Form 11 is an annual return that must be filed by every LLP with the Registrar of Companies (ROC). This form provides details of the LLP’s partners, their contributions to the business, and changes in the LLP’s structure, if any, during the year.
The due date for filing Form 11 is within 60 days of the end of the financial year. For example, if the financial year of the LLP ends on March 31st, the due date for filing Form 11 is May 30th of that year.
The LLP must file Form 11 even if there have been no changes in the LLP’s partners during the year. The form must be signed by a designated partner and certified by a practicing Company Secretary.
Along with Form 11, the LLP must attach various documents, such as the LLP agreement, details of the LLP’s designated partners, and details of any changes in the LLP’s partners during the year.
The information provided in Form 11 is publicly available, and it’s important for the LLP to ensure that the information is accurate and up-to-date. Any changes in the LLP’s partners or structure during the year must be reflected in the form. Non-filing or delayed filing of Form 11 can result in penalties and fines imposed by the ROC. It’s important for the LLP to ensure timely and accurate filing of Form 11 to avoid any legal or financial liabilities
Form 8 is a statement of account and solvency that must be filed by every LLP with the Registrar of Companies (ROC). This form provides details of the LLP’s financial position, including its assets and liabilities, as well as the solvency of the LLP.
The due date for filing Form 8 is within 30 days from the end of six months of the financial year. For example, if the financial year of the LLP ends on March 31st, the due date for filing Form 8 is October 30th of that year.
Along with Form 8, the LLP must attach various documents, such as the LLP’s financial statements, auditor’s report, and a statement of partners’ contributions.
The LLP must ensure that the financial statements attached to Form 8 are accurate and comply with the relevant accounting standards. The auditor’s report must also comply with the relevant auditing standards and provide an opinion on the financial statements.
The statement of partners’ contributions must provide details of the partners’ contributions to the LLP, including any changes in their contributions during the year.
The LLP must also ensure that the information provided in Form 8 is consistent with the information provided in other forms, such as Form 11 and the LLP agreement. Non-filing or delayed filing of Form 8 can result in penalties and fines imposed by the ROC. It’s important for the LLP to ensure timely and accurate filing of Form 8 to avoid any legal or financial liabilities.
PT and GST compliance
PT enrollment renewal (Karnataka)
PT enrollment renewal is the process of renewing the LLP’s PT registration. The registration must be renewed annually, and the due date for renewal is typically April 30th of every year. The link for PT payment has been changed to https://pt.kar.nic.in/
Monthly GST Returns: The due date for filing monthly GST returns GSTR-3B, 20th of the following month, and GSTR-1 the 11th of the following month. Annual GST Return: The due date for filing the annual GST return (GSTR-9) for LLPs is December 31st of the following financial year.
Tax and audit compliance:
Tax audit applicability
Tax audit is applicable for LLPs if their turnover exceeds Rs. 1 crore in case of professionals and Rs. 5 crores in case of other businesses.
The due date for filing the tax audit report for LLPs for the financial year 2022-23 is September 30, 2023.
The tax audit report must be submitted in Form 3CA-3CD or Form 3CB-3CD, depending on the nature and size of the LLP’s business. The LLP must also attach a copy of its audited financial statements and other necessary documents. The tax audit helps ensure accurate reporting of the LLP’s financial transactions and minimizes the risk of penalties and legal liabilities. It’s important for LLPs to comply with the tax audit requirements to avoid any legal or financial issues
Income Tax Filing
LLPs must file their income tax returns electronically on the Income Tax Department’s website using Form ITR-5. n case of LLP covered under Audit, the last date is 31st October 2023. In other cases the date is 31st July 2023 (i.e LLP’s not covered under audit)
TDS (Tax Deducted at Source) filings for LLPs:
LLPs are required to deduct TDS if they make certain payments such as salaries, professional fees, rent, etc. to their employees, vendors, or contractors.
The LLP must obtain a TAN (Tax Deduction and Collection Account Number) from the Income Tax Department before deducting TDS.
The LLP must deduct TDS at the applicable rates and deposit it with the government within the prescribed due dates.
The LLP must also file quarterly TDS returns in Form 24Q or Form 26Q, depending on the type of payments made. The due dates for filing TDS returns are:
- 31st July for the first quarter (April to June)
- 31st October for the second quarter (July to September)
- 31st January for the third quarter (October to December)
- 31st May for the fourth quarter (January to March)
The LLP must ensure that it complies with TDS provisions and file its TDS returns on time to avoid any penalties or interest charges.
Prakasha & Co is a professional services firm that specializes in providing assistance with LLP compliance filings, including Form 11 and Form 8, as well as LLP tax filings. With their expertise and experience, they can ensure that your LLP is compliant with all regulatory requirements and deadlines.
If you need help with any of these filings or have any questions about LLP compliance, Prakasha & Co can help. Their team of experts can provide tailored advice and support to meet your specific needs, ensuring that your LLP remains in good standing and avoids any penalties or legal issues. Contact them today to learn more about their services and how they can help your business