Annual compliance for private limited company

Annual compliance for private limited company

Annual compliance for private limited company

Every corporation that is registered in India like a private limited company, one person company, limited company, and section 8 company should file MCA annual return and income tax return every year. Before filing annual return, the corporation is required to conduct an Annual General Meeting at the end of each financial year. The Annual General Meeting for newly incorporated companies must be held within 18 months from date of incorporation or 9 months from the date of closing of the financial year, whichever is earlier. Following the Annual General Meetings must be held within 6 months from the end of that financial year. In India, the financial year starts on 1st April and end on 31st March. So a Company's annual return shall be due on or before September 30th.

Documents required for the Annual compliance for private limited company

The documents required for the annual compliance for private limited company are:

  • Documents for Incorporation - PAN Card, Certificate of Incorporation and MoA – AoA of Private Company.

  • Audited Financial Statements - Financial Statements should be audited by the independent auditor.

  • Audit Report and Board Report - Independent auditor’s report and Board report should be provided.

  • DSC of Director - Valid and active DSC of one of the directors should be provided.

Annual Compliance for Private Limited Company in India.

The mandatory annual compliance for private limited company in India consists of:

Annual Return in Form MGT-7: It contains the current or updated information regarding the directors as well as shareholders of the private limited company, this Form is required to be filed with relevant ROC within 60 days from the date of Annual General Meeting (AGM). In case, the paid-up capital of the private limited company gets above Rs. 10 Crore or its annual turnover becomes more than Rs. 50 Crore, then, there would arise the requirement of filing the Form MGT-8 also.

Financial Statements in Form AOC-4: This is required to be filed with the concerned ROC within 30 days from the date of AGM of the corporation. According to the new provisions given in the Companies Act of 2013, this would contain the Balance Sheet, Profit and Loss Account, Directors’ Report, and the Consolidated Financial Statement.

Income Tax Returns: This is required to be filed with the Income Tax Department, on or before 30th September of the following financial year. Again, tax-audit would be necessary if the annual turnover of the private limited company becomes more than Rs. 1 Crore.

Event-Based Annual Compliances: These are based on internal company administration, external business management, or any unexpected or contingent activities.

Various Annual Compliances under other Laws applicable: These might relate towards Corporate and Commercial laws, GST Act, Labor and Employment Laws, Intellectual Property Laws, Excise and Custom, PF and ESI Regulations, Environmental Laws, etc.

The penalty for non-compliance

From July 2018, corporations failing to follow the statutory compliance for Private Limited shall be charged ₹100 for each day perform of a delay till the actual date of filing. There is no ceiling restriction towards an additional fee. For continuous failure, penalty apart from the additional Government fee could be levied on both – corporation and directors, which also includes imprisonment.

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eStartIndia Team

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