All Limited Liability Partnerships (here in after referred to as LLP) shall be under obligation to maintain annual accounts reflecting true and fair view of its state of affairs. Every Limited Liability Partnership (LLP) is required to file LLP Form-8 (Statement of Account & Solvency), LLP Form-11 (Annual Return) and ITR-5 (Income Tax Returns) annually. The statutory fees for filing Form 8 & 11 will depend upon the capital contribution of the LLP.
Every LLP Registered on or before 30th September 2021 have to file returns for the financial year ending 31st March 2022.
Filing of Returns with Registrar for LLP’s registered on or after 1st October 2021 will fall only in the year 2023.
However, every LLP registered on or after 1st October of a financial year and before 31st March have to file the Income Tax return with the Income Tax Authorities.
Filing of returns is mandatory and every LLP have to maintain the compliance irrespective of whether they are doing the business or not. The reason is simple you know that you are not doing the business but Government doesn’t know that, so through the annual statement or filings you are giving information to the Government about your organization.
Audit Requirement under LLP Act: Only those LLP whose annual turnover exceeds Rs. 40 lakhs or whose contribution exceeds Rs. 25 lakhs are required to get their accounts audited by a qualified Chartered Accountant Section 34(4) of the Limited Liability Partnership Act.
Audit Requirement under Income Tax Act: Audit of accounts is mandatory requirement under Income Tax Act when the annual turnover of LLP is more than one hundred lakhs rupees.
Certifications from PCS: In case of LLPs with turnover more than five crore rupees in a financial year or contribution more than fifty lakh rupees, the Annual Return (Form-11) has to be certified by a Company Secretary in Practice.
1. Filing Annual Return:
Annual Return or Form-11 is a summary of LLP’s Partners like whether there is any change in the management of the LLP. Every LLP is required to file Annual Return in Form-11 to the Registrar within 60 days from the closure of financial year i.e., the Annual Returns has to be filed on or before 30th May every year is the last date for filing annual Returns this year Section 35 (1) of the Limited Liability Partnership Act.
2. Filing of Statement of Accounts & Solvency (Annual Accounts):
According to Section 34 (1) of the Limited Liability Partnership Act, every LLP has to maintain proper books of account as prescribed in the Act relating to its affairs for each year of its existence on cash basis or accrual basis and according to Double Entry System of accounting and shall maintain the same at its registered office.
Further with reference to sub section (2) every LLP 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 as at the last day of the said financial year in such form as may be prescribed, and such statement shall be signed by the designated partners of the LLP.
Every LLP is required to file Form-8 to the Registrar within 60 days from the end of six months of financial year i.e. on or before 30th October every year. 30th October 2022 is the last date for filing annual accounts this year (Financial Year 2021-22) Section 34 (3) of the Limited Liability Partnership Act.
3. Filing Income Tax Returns:
In case where Audit is required, the last date for filing Income Tax returns is 30th September Every Year and wherein companies which do not fall under the Audit requirement criteria will have to file Income tax returns on or before 31st July Every Year.
If the LLP has not carried any business during the year ended 31st March of the year, the LLP has to file a NIL IT RETURN with Income Tax Authorities before 31st July every.
The Following are the Returns to be filed by an LLP for the year ended 31st March, 2020.
A Returns
1 Annual Return (Form-11) – 30th May Every Year
2 Accounts (Form-8) – 30th October Every Year
B Returns
1 In case Audit is not required – 31st July Every Year
2 In Case Audit is required – 30th September Every Year
4. DSC Requirements:
While uploading e-forms Digital Signatures of any 2 Designated Partners are required for filings.
5. Penalty for Non-Filing:
If there is delay in filing Form-8 and Form-11 of LLP, you will have to pay penalty as applicable on today’s date. If filing is not done within stipulated time, there is penalty of Rs. 100 per day till it is compiled / the default is made good (the penalty is unlimited / there is no upper limit). You cannot close or wind up your LLP without filing Annual Accounts.
So if you don’t file on time, your LLP turns into unlimited statutory liability till the day it is complied. And those who think that if you don’t file the returns the LLP would turn dormant and you could close it / strike it off absolving yourself of the penalty and the compliance, remember to close your LLP too you would require to make good the compliance first.
The LLP Act contains provisions for compounding of offences which are punishable with fine only. Further, for defaults/non-compliance on procedural matters such as time limits for filing requirements provisions have been made for charging default fees (on daily basis) in nondiscretionary manner.
To avoid all the dangerous consequences of heavy penalty, it would be advisable to comply on time within stipulated due date of filing.
Disclaimer: The entire contents of this document have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation. Though utmost efforts have been made to provide authentic information, it is suggested that to have better understanding kindly cross-check the relevant sections, rules under the Companies Act, 2013, Income Tax Act, Rules, Regulations and all other Acts applicable to Companies. The observations of the author are personal view and this cannot be quoted before any authority without the written consent of the author.