Annual Compliances for LLP   

A Limited Liability Partnership is a separate legal entity. In order to preserve active status and to avoid default status. A regular filing with MCA is required to be taken care by all Limited Liability partnerships. Annual Compliance for any LLP is obligatory and unavoidable. Annual Compliance for LLP needs filing of two forms.  

• Annual Returns

• Statement of Accounts or financial statements  

Filing LLP Annual Return

Annual return declares briefly in statements by reporting any change in activities and in management of the corporate for every financial year in coming years. Each LLP needed to file the Annual Return also known as Form 11 to the registrar within a span of 60 days after closing the books of accounts of the reputed organisation.

Filing Statements of Accounts

The Double Entry System is followed by all the LLP’s to maintain their Books of Accounts. In preparation of Statement of Accounts each year as on 31st March, LLP Form 8 is required to be deposited with the ROC on or before 30th October annually. Moreover, LLP’s whose yearly turnover exceeds Rs.40 lakh are required to get their financial accounts examined by an accomplished Chartered Accountant compulsorily.

Benefits of Annual Compliance

Convertibility and Settlement

Annual filing is very crucial for conversion of LLP into any other corporation. The records of annual compliance filed each year simplifies the process of conversion as well as the closure of organisation. Generally, the Registrar interrogates the fulfillment of Annual compliance with additional LLP fee before the conversion and settlement of the company.

 Reliability

The Ministry of Corporate Affairs declares the status of Annual compliance for LLP on it’s official portal. The ethics and moral of the company are dependent on the annual compliances.

Notify Creditworthiness

While entering into contracts, companies can approach the forms filled by the LLP to introspect the financial worth of the company. The record of financial statements forms a picture of net worth in the minds of interested parties before entering into a contract.

Regular filing avoids penalties

With an intention to avoid heavy penalties and fees, regular filing of forms protects partners to be declared as defaulters. It also avoids further disqualification of contracts. Hence, LLP needs to fulfill the Annual Compliance requirements. The non-fulfillment of LLP Annual Compliance adds up in the form of heavy penalties till the actual date of filing.

The struggle in maintaining a business is real from setting up to the implementation.  

 All the filing and the documentation process should be taken care of.  Compared to different companies LLP has fewer compliances and easy to acquire. Due to any reason if you fail to pay all the compliances on time a charge of Rs 100 will be added on a daily basis to the total amount. Thus the company should spend a good deal of resources in obeying the rules and regulations. Regular checkups of the amendments are significant as the law is very dynamic and changes from time to time.