Mastering LLP Compliance After Incorporation: Complete Guide

Introduction:

Limited Liability Partnerships (LLPs) have become a popular choice for businesses in India due to their flexible structure and limited liability for partners. However, like any other legal entity, LLPs are subject to various compliance requirements under the LLP Act 2008 and the accompanying LLP Rules. In this guide, we will explore the key compliance requirements that LLPs must adhere to in order to maintain their legal standing.

1. LLP Agreement (Form 3):

Every LLP is required to file the agreement of LLP within 30 days of its incorporation with the Registrar of Companies. The agreement is to be printed on Stamp Paper with proper amount of stamp duty applicable according Stamp Act applicable in the State where registered Office of the LLP is situated. The agreement is also required to be notarized.

2. Annual Return Filing (Form 11):

Every LLP is required to file an annual return in Form 11 within 60 days of the close of the financial year.

This return should include details of the partners, statement of account and solvency, and any other prescribed information.

3. Statement of Accounts and Solvency (Form 8):

LLPs must file Form 8 within 30 days from the end of six months of the financial year.

This statement contains a declaration of solvency by the designated partners, along with the financial statements of the LLP.

4. Appointment of Statutory Auditor:

LLPs whose Turnover in any year exceeds Rs. 40 Lakhs or Contribution exceeds Rs. 25 Lakhs are required to appoint a qualified Chartered Accountant as a statutory auditor.

The auditor shall be appointed 30 days before end of Financial Year.

The auditor’s appointment must be intimated to the Registrar of Companies within 30 days.

5. Income Tax Filings:

LLPs are subject to income tax regulations and are required to file income tax returns annually.

They should also obtain a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) if applicable.

6. Maintenance of Books of Accounts:

LLPs must maintain proper books of accounts at their registered office.

These books should be kept for at least eight years.

7. Change in Partners or Registered Office:

Any changes in the partners’ details or the registered office address must be notified to the Registrar of Companies.

8. Penalties for Non-Compliance:

Non-compliance with the LLP Act 2008 and LLP Rules can lead to penalties and fines.

It’s essential to stay updated with the latest compliance requirements and meet all deadlines to avoid legal consequences.

Conclusion:

Compliance with the LLP Act 2008 and LLP Rules is essential for LLPs to maintain their legal status and enjoy the benefits of limited liability. It’s advisable for LLPs to engage with qualified professionals or company secretaries who specialize in LLP compliance to ensure that all statutory requirements are met promptly and accurately. Staying compliant not only helps in avoiding legal issues but also fosters trust and credibility among stakeholders.

Disclaimer:

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