The Annual Compliances required for a Limited Liability Partnership (LLP)

Statutory Compliances:

1. Annual Return (Form 11): Every limited liability partnership shall file an annual return in Form 11 duly authenticated with the Registrar within sixty days of closure of its financial year.

2. Statement of Account and Solvency (Form 8): Every limited liability partnership shall, within a period of six months from the end of each financial year, prepare a Statement of Account and Solvency for the said financial year and such statement shall be signed by the designated partners of the limited liability partnership.

3. Income Tax Return (ITR): Filed with the Income Tax Department by July 31st (or September 30th with audit).

4. GST Returns: Filed with the Goods and Services Tax (GST) Department (if applicable).

Other Compliances:

1. LLP Agreement: Ensure the LLP Agreement is up-to-date and compliant with the LLP Act.

2. Partners' Details: Maintain and update partners' details, including changes in ownership or designation.

3. Audited Financial Statements: Prepare and maintain audited financial statements.

4. Maintenance of Books of Accounts: Maintain accurate and complete books of accounts.

Due Dates:

1. Annual Return (Form 11): Within 60 days from the end of financial year i.e. 30^th May

2. Statement of Account and Solvency (Form 8): 30^th October every year.

3. Form 3: Within 30 days of incorporation of LLP at the time of filing of initial LLP agreement or within 30 days of change in LLP agreement at the time of filing subsequent LLP agreement

4. Form 4: i. Where a person becomes a Designated Partner or Partner; or ceases to be one, then a notice is filed with the Registrar within thirty days from the date he becomes or ceases to be a Designated Partner or Partner; and

ii.  Where there is any change in the particulars of a Partner, a notice is filed with the Registrar within thirty days of such change.

5. Income Tax Return (ITR): July 31st/September 30th

6. GST Returns: Varying due dates (e.g., GSTR-3B, GSTR-1)

Penalties for Non-Compliance:

1.      Form 8:

a)      Late filing fees; or

b)     if any limited liability partnership which fails to comply with the provisions of sub-section (3) of Section 34, such limited liability partnership and its designated partners shall be liable to a penalty of one hundred rupees for each day during which such failure continues, subject to a maximum of one lakh rupees for the limited liability partnership and fifty thousand rupees for every designated partner.

2.      Form 11:

a)      Late filing fees; or

b)     if any limited liability partnership fails to file its annual return under sub-section (1) of Section 35 before the expiry of the period specified therein, such limited liability partnership and its designated partners shall be liable to a penalty of one hundred rupees for each day during which such failure continues, subject to a maximum of one lakh rupees for the limited liability partnership and fifty thousand rupees for designated partners.

3.      For non-maintenance of books of accounts- Any limited liability partnership which fails to comply with the provisions of sub-section (1), sub-section (2) and sub-section (4) of Section 34, such limited liability partnership shall be punishable with fine which shall not be less than twenty-five thousand rupees, but may extend to five lakh rupees and every designated partner of such limited liability partnership shall be punishable with fine which shall not be less than ten thousand rupees, but may extend to one lakh rupees.

4.      Penalty for non-compliance with GST returns

5.      Interest and penalty for delayed income tax payment

Some frequently asked questions (FAQs) related to LLP compliances:

General Compliances

1. Q: What are the annual compliances required for an LLP?

A: Annual Return (Form 11), Statement of Account and Solvency (Form 8), Income Tax Return, and GST Returns (if applicable).

2. Q: Who is responsible for ensuring LLP compliance?

A: Designated Partners and the LLP itself.

3. Q: What is the consequence of non-compliance?

A: Fines, penalties, prosecution, and potential striking off from the register.

Form 11 (Annual Return)

1. Q: What is Form 11?

A: Annual Return filed with the MCA within 60 days of the financial year-end.

2. Q: What information is required in Form 11?

A: LLP details, partner information, business activities, and financial details.

Form 8 (Statement of Account and Solvency)

1. Q: What is Form 8?

A: Statement of Account and Solvency filed with the MCA on or before 30^th October every year.

2. Q: What information is required in Form 8?

A: Financial statements, solvency statement, and auditor's report (if applicable).

Income Tax Return

1. Q: Is an LLP required to file an Income Tax Return?

A: Yes, by July 31st (or September 30th with audit).

2. Q: What is the tax rate for LLPs?

A: 30% (plus cess).

Auditing and Accounting

1. Q: Is audit required for an LLP?

A: Yes, if turnover exceeds ₹40 lakhs or contribution exceeds ₹25 lakhs.

2. Q: What accounting standards apply to LLPs?

A: Accounting Standards notified by the ICAI.

Other

 1. Q: Can an LLP be struck off the register?

A: Yes, for non-compliance or other reasons.

2. Q: How can an LLP be dissolved?

A: Voluntarily or by order of the Tribunal.