Limited Liability Partnership Act, 2008 introduced a new concept called Limited Liability Partnership. Parliament of India enacted this Act on 12 December 2008 and it was commenced from 31st March 2009.
Limited Liability Partnership is the hybrid form of company and a partnership firm. It is a body corporate having a separate legal entity from its members. Further, it has perpetual succession that is its life is not affected by the life of its members. The main motive behind the introduction of this form of company was to enable professionals and entrepreneur’s to come together and operate in the flexible, innovative and efficient manner, providing them the benefits of limited liability.
Every limited liability partnership registered with the ministry of corporate affairs is required to fulfill their annual compliance requirement. Further, it is mandatory for every LLP to file its annual statements irrespective of whether the business is done or not. However, the annual compliances requirement of an LLP is very less as compared to the other form of companies.
Annual compliances for LLP
Following are the three compulsory requirements that every LLP is required to file annually-
Filing of statement of accounts and solvency- Every LLP is required to file Form-8 containing the statement of solvency to Registrar Of Companies on or before 30th October every year. For this purpose, all the LLPs are required to maintain their Books of Accounts in Double Entry System. Also, they need to prepare a Statement of Solvency (Accounts) every year ending on 31st March.
Further, it should be noted it is mandatory for the LLPs whose annual turnover exceeds Rs. 40 lakh or whose contribution exceeds Rs. 25 lakh to get their accounts audited by a qualified Chartered Accountant.
Annual returns- Every LLP is required to fill form 11 within 60 days of the closure of financial statement for the current financial year. Thus, the annual return is required to be the file on or before 30th may every year. This form is a summary of the management affairs of the LLP, such as the number of partners and their names. Further, it also indicates the change in the management of the LLP.
Income tax returns- It is mandatory for every LLP to file its income tax returns by 30 September every year. Even if LLP has not done any business for the current financial year, they are required to file Nil Income Tax returns with the tax authorities.
Audit- Every LLP whose annual turnover exceeds rupees 40 lakhs or the capital contribution of the partners exceeds rupees 25 lakhs then it is required to get its accounts audited by the certified charted accountant.
LLP Seal- LLP seal is required to open a bank account and for application of PAN. Hence LLP should have two rubber seals around with LLP name and LLP name with designation can be purchased on Incorporation of the company.
Letter Head- The name of the LLP shall be printed on the various documents like letterhead and invoices etc. These documents are the significant stationary of the company.