Last updated: May 28th, 2021 5:16 PM

LLP Annual Filing and Audit Requirement

Compared to a Private Limited Company, LLPs have minimal annual filing and accounts maintenance requirements. In this article, we review the annual compliances required for a LLP in terms of annual filing with the ROC and accounts maintenance.

LLP Overview

Limited Liability Partnership (LLP) is a newly introduced business entity in India. LLPs were introduced through the LLP Act, 2008 and the LLP business structure has been quickly adopted by a number of small and medium sized businesses due to the minimal procedural requirements associated with starting and managing a business as a LLP. To know more about LLP, visit IndiaFilings.com.

LLP Accounts Maintenance

All LLPs are required to maintain proper books of accounts since registration on cash basis or accrual basis. Private Limited Companies are required to maintain book of accounts only in accrual basis; however, LLPs have the option of maintaining book of accounts on cash basis as well. The book of accounts must be maintained at the Registered Office of the LLP and must contain information about all the money received and expended, assets and liabilities, statement of COGS, inventories and finished goods statement. At the end of each financial year, all the LLPs are required to prepare their financial statements within 6 months for filing with the ROC.

LLP Annual Filing

Annual return is a mandatory filing to be made by all LLPs in India. The annual return must be filed in the prescribed format with the Ministry of Corporate Affairs. Filing of annual return with the MCA is different from the filing of annual return with the Income Tax department. Annual return of a LLP is due within 60 days of close of financial year. LLPs must uniformly maintain a financial year that starts on April 1st and ends on March 31st, therefore the Annual return of a LLP is due on or before May 30th of each financial year.

On the other hand, Statement of Accounts and Solvency of a LLP is due within 30 days from the end of six months of close of financial year. Statement of Accounts and Solvency is a mandatory filing that is required for all LLPs in India. Statement of Accounts and Solvency contains a declaration on the state of solvency of the LLP by the designated partners and also information related to statement of assets and liabilities and statement of income and expenditure of the LLP.

LLP Audit Requirement

LLPs are required to have its accounts audited by a practicing Chartered Accountant if its annual turnover, in any financial year exceeds Rs.40 lakhs or its contribution exceeds Rs.25 lakhs. In order to avail the exemption from audit, the LLPs accounts filed with the ROC must contain a statement by the Partners to the effect that the Partners acknowledge their responsibilities for complying with the requirements with respect to accounting and preparation of financial statements.

To file the annual return for a LLP, visit IndiaFilings.com