Overview

An LLP is a partnership between/among limited numbers of partners where each partner owes a limited liability for any debts that occur in the partnership. It is separate legal entity bound by certain legal obligations. 
Limited Liability Partnership requires to maintain its status active and to maintain its status active, it is required to do Compliances as mentioned Under LLP Act.  
 

Compliances of LLP

After the incorporation of the LLP, there are some mandatory compliances that should be complied on time. In case, if LLP don’t comply with these compliances, it may face penalties. The following are the mandatory compliances for LLP in India: -

One-Time Mandatory Compliance for LLP

1. LLP Form-3: - All the partners of LLP (Limited Liability Partnership) are required to file LLP form-3 within 30 days of LLP incorporation with the ROC (Registrar of Companies).

2. Opening a Bank Account: - It is essential to have a current account with the name of LLP, so that all the transactions can be done through LLP account. Bank account can be opened with any bank.

Annual Compliance for LLP

1. Statement of Accounts and Solvency in Form- 8: - Every LLP is required to prepare and close its books of account on 31st March every year. It is also required to file Statement of Accounts and Solvency (Form 8) on or before 30th October of every year.

2. Annual Return in Form-11:- Every LLP is required to file Form 11  within 60 days from the end of the financial year with the registrar. Form 11  is a summary of the affairs of the management of the company.

3. Income Tax (IT) Return: - Every LLP must file income tax return every year and the last date to file income tax return is 31st of July.

4. DIR-3 KYC: - All the designated directors of Limited Liability Partnership are required to file DIR-3 KYC on or before 30th of September every year.

5. Audit: - LLPs whose annual turnover is more than Rs. 40 lakhs or contribution is more than 25 lakhs is required to get their account audited on or before 30th of September every financial year.
 

Benefits of LLP compliances in India

1. Easy to close and convert in LLP: - To do compliances on time is vital for LLP, as it makes easy to convert LLP in other form of companies and case of closer close the LLP.

2. Refrain from Penalties: - In order to refrain from heavy penalties and late fee, annual filing is important or else you may have to face penalties. If you keep up with regular filing it helps you to run your operations smoothly.

3. Financial Record: - All the forms which are filed by Limited Liability Partnership, are also accessible by all. In case any major contract or deal, companies can inspect the financial records and legal compliances of the LLP. Managed compliances and financials provide trust and confidence to the interested party.

4. Reputation: - As we mentioned earlier that any individual can access the Master Data and financial records of the LLP, legal compliances are the key factor to check how trustworthy and organized a company is.

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