Don't Let Your LLP Kill Your Business

Probably, you chose to start LLP over company because it is less costly and requires relatively lesser compliance. But, you might be unaware of the fact that if you don’t comply with mandatory requirements for an LLP, you will end up paying such heavy penalties that it can even force you to shut down your business.

Non compliance can literally kill your business! Late filing fees are Rs 100/- per day and will continue until you comply it.

So, if you delay a compliance by 90 days, Rs 9,000/- is your penalty, and if you delay it for 365 days, oh ghosh! You are almost giving an ‘iPhone 6’ for free. Rs 36,500/- is your penalty!

Please don’t do that. Buy an iPhone for yourself and not the government. Moneyम्जी brings to you, compliances that you don’t afford to avoid.

Maintenance of Accounts: Accounting not only clears up the mess of your transactions, but is also mandatory under the LLP Act. Your books of accounts should reflect a true and fair view of transactions and financial position.

What all should your books of accounts cover?

– All the money received by your LLP

– All the expenses of your LLP

– All the assets and liabilities of your LLP

– Statements of costs of goods purchased, inventories, finished goods and goods sold;

– Any other particulars as decided by partners in the meeting

Filing of annual accounts and solvency statement: You need to submit the your accounts annually with the Registrar of Companies in Form 8. Moneyम्जी has memorized that ‘Diwaliaa’ statement has to be filed near ‘Diwali’ period. 😐 You too can remember it this way.

Just remember the date: 30th October every year! It’s the due date of filing your statement of accounts and solvency. So, when you think of Diwali, also think of filing annual accounts.

Filing of Annual Return: Annual Return is mandatory for any LLP, and it’s due date comes very earlier than filing accounts. When there is no festival, everything looks dry, think of filing annual return. It’s due date is 30th May. Annual Return is filed in Form 11.

Statutory audit For Bigger Players: Bigger players are not decided by being Singhanias or Oberois, it is decided based on your turnover and contribution.

If your turnover a) exceeds Rs 40 lakh or b) capital contribution exceeds Rs 25 lakh, then you are liable to get audited.

Appointment of Auditor:

a) If turnover crosses Rs 40 lakh or contribution exceeds Rs 25 lakh

b) 30 days before the end of financial year, i.e., March 1.

Tax Audit: Mandatory if turnover exceeds Rs 100 crore, in case of business, and gross receipts exceed Rs 25 lakh in case of profession. Due date: Before September 30.

Income Tax Return: Income Tax Return is mandatory to be filed for an LLP. Due date is July 31, but if your LLP is covered under tax audit, you get 3 more months. Due date in this case becomes September 30.

These few compliances, if not followed, can kill your business. Moneyम्जी doesn’t want that to happen with your business. You can take help of Moneyम्जी in meeting these compliances and save yourself from wasting your crucial funds on penalties. 

Write to Moneyम्जी at [email protected] for any queries.