LLP Annual Filing-All you need to know

About LLP Annual Filing

An LLP is a form of separate legal business entity that gives the benefits of limited liability but allows its members the flexibility of organizing their internal structure as a traditional partnership. It is governed by the Limited Liability Partnership Act, 2008. In LLP, unlike a company, the designated partner have a direct relationship between owner and management. Every year an LLP needs to comply with LLP Annual filing.

You will have the protection of a registered company; one partner will not be liable for any misconduct or negligence of another partner. LLP can operate not according to Company’s Act, 2013 but as per the LLP agreement formed at the time of its incorporation and LLP Act, 2008.

Important update on LLP Annual Filing Due dates

Under the Revised LLP Settlement Scheme, 2020, All the LLPs can complete their pending Annual Filings without any late filing fees or penalties. The due date for the LLP Annual filing has been extended till 31.12.2020 as the date for the conclusion of the LLP Settlement Scheme, 2020 has been extended from 30th September to 31st December 2020. Hence all the Annual filing forms given below can be filed on or before 31st December 2020 without any penalties. This is One-time one-time relaxation in payment of additional fees and immunity from prosecution.

Mandatory compliance for an LLP Annual Filing 

Important due dates

Filing of Statement of Accounts (Form-8)

Every LLP is required to prepare and close its accounts until the 31st March every year. From 8 is to be filed by at least two Designated Partners with the Registrar within 30 days after completion of six months of Financial Year. Accordingly, 30th October 2018 is the last date for filing annual accounts every year.

Note: Under LLP Settlement Scheme, 2020, LLP Form 8 for all the previous years and current year till 31.12.2020 without any late filing fees or penalties.

Recommended Read: All you need to know about LLP Form 8

Filing of Annual Return (Form 11)

Annual Return or Form 11 is a Summary of all the Designated Partners like whether there are any changes in the management of the LLP or not. 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. Annual Returns have to be filed on or before 30th May every year.

Note: Under LLP Settlement Scheme, 2020, LLP Form 11 for all the previous years and current year till 31.12.2020 without any late filing fees or penalties.

Recommended Read: All you need to know about LLP Form 11

Income Tax Return

Every LLP has to file Income Tax Returns every year. The last date of filing of return for LLP is 31st July every year. However, any LLP under tax audit is required to file its Income tax return by 30th September. For FY 2018-19 and FY 2019-20, the due date for filing Income Tax return has been extended till 30th November 2020.

Audit under Income-tax Act

Every LLP whose turnover exceeds INR 2 Cr. In case of a business or INR 50 Lakh in case of a profession, is required to get its books of accounts tax audited under section 44AB of the Income-tax Act. Such audit will have to be completed and filed by 30th September.

Audit under LLP Act

It may be noted that only those LLP whose annual turnover exceeds Rs. 40 lakhs or whose contribution exceeds Rs. 25 lakhs are required to get their accounts audited.

Penalty for non-Filing

If there is a delay in filing Form 8 and 11 of LLP, you will have to pay the penalty of Rs. 100 per day of default. One cannot close or wind up their LLP without filing Annual Accounts.

Important Note: All the defaulting LLPs, that have failed to file its annual returns including LLP Form 8 and LLP Form 11 can file such forms without any late filing fees under the LLP Settlement Scheme. The due date to file LLP Annual returns under the LLP Settlement Scheme, 2020 (LSS 2020) is 31st December 2020.

Conclusion

It is the responsibility of the Designated Partners of an LLP to maintain a proper book of accounts and file an Annual Return with the MCA each financial year. Hence it is advisable that you file your form LLP 8 and Form 11 before the due dates.