LLP Compliance Calendar: Key Dates and Filing Requirements

Introduction

Limited Liability Partnerships (LLPs) have become an increasingly popular business structure in India, combining the flexibility of partnerships with the limited liability protection of companies. However, with these benefits comes the responsibility of adhering to various regulatory requirements. Maintaining compliance is not just a legal obligation but also a strategic business practice that fosters trust among stakeholders and prevents costly penalties.

This comprehensive LLP compliance calendar serves as your guide to navigating the complex landscape of filing requirements and deadlines throughout the financial year. Whether you're a designated partner, compliance officer, or a professional managing compliance for clients, understanding these key dates and requirements is essential for smooth business operations.

In this blog, we'll cover annual, quarterly, and event-based compliance requirements, penalties for non-compliance, and best practices to ensure your LLP in India remains in good standing with regulatory authorities. We'll also explore how businesses operating in global markets, particularly in the US, UK, and Singapore, can align their Indian LLP compliance with international standards.

Understanding LLP Structure in India

Before diving into compliance requirements, it's important to understand the basic structure of an LLP in India. An LLP is a corporate business vehicle that provides limited liability to its partners while allowing them the flexibility of organizing their internal structure as a partnership.

Key Features of an LLP

• Separate Legal Entity: An LLP is a legal entity separate from its partners.
• Limited Liability: Partners' liability is limited to their agreed contribution.
• Perpetual Succession: An LLP can continue regardless of changes in partners.
• No Minimum Capital Requirement: Unlike a private limited company, there is no minimum capital requirement for an LLP.
• Designated Partners: Every LLP must have at least two designated partners, one of whom must be a resident of India.

Governing Laws

LLPs in India are primarily governed by:

1. The Limited Liability Partnership Act, 2008
2. Limited Liability Partnership Rules, 2009
3. Circulars and notifications issued by the Ministry of Corporate Affairs (MCA)

Understanding this structure is crucial for comprehending the compliance requirements that follow. Now, let's explore the detailed compliance calendar that every LLP in India must adhere to.

Annual Compliance Requirements

Annual compliance forms the backbone of regulatory requirements for LLPs. These are recurring obligations that must be fulfilled every financial year.

1. Annual Return (Form 11)

• Due Date: Within 60 days from the closure of the financial year (May 30th)
• Details Required:
  • Partner details
  • Changes in partners during the year
  • Principal business activities
  • Details of LLP agreement and changes
  • Details of bodies corporate/LLPs/companies of which partners are also partners/directors

2. Statement of Account & Solvency (Form 8)

• Due Date:
  • For LLPs with annual turnover up to ₹5 crore or contribution up to ₹50 lakh: Within 6 months from the end of the financial year (September 30th)
  • For all other LLPs: Within 30 days from the end of 6 months of the financial year (October 30th)
• Details Required:
  • Statement of assets and liabilities
  • Statement of income and expenditure
  • Solvency declaration by designated partners

3. Income Tax Return

• Due Date: July 31st (if audit not required) or October 31st (if audit required)
• Forms:
  • ITR-5 for resident LLPs
  • ITR-5 or ITR-7 for foreign LLPs, depending on their status

4. Tax Audit (if applicable)

• Applicability:
  • LLPs with turnover exceeding ₹1 crore (₹10 million)
  • LLPs with professional receipts exceeding ₹50 lakh (₹5 million)
• Due Date: September 30th

5. GST Annual Return (if registered under GST)

• Due Date: December 31st of the following financial year
• Forms:
  • GSTR-9 (Annual Return)
  • GSTR-9C (Reconciliation Statement and Certification) if turnover exceeds ₹5 crore

Quarterly Compliance Requirements

Quarterly compliance ensures regular monitoring and reporting throughout the financial year.

1. GST Returns (if registered under GST)

• GSTR-1 (Outward Supplies)
  • Due Date: 11th of the month following the quarter (for LLPs with turnover up to ₹5 crore)
  • Monthly filing (10th of next month) for LLPs with turnover above ₹5 crore
• GSTR-3B (Summary Return)
  • Due Date: 20th of the month following the quarter (for LLPs with turnover up to ₹5 crore)
  • Monthly filing (20th of next month) for LLPs with turnover above ₹5 crore

2. TDS Returns (if applicable)

• Form 24Q (TDS on Salaries)
  • Due Dates: July 31st, October 31st, January 31st, and May 31st
• Form 26Q (TDS on Payments other than Salaries)
  • Due Dates: July 31st, October 31st, January 31st, and May 31st
• Form 27Q (TDS on Payments to Non-residents)
  • Due Dates: July 31st, October 31st, January 31st, and May 31st

3. Advance Tax Payments

• First Installment: 15% of tax by June 15th
• Second Installment: 45% of tax by September 15th
• Third Installment: 75% of tax by December 15th
• Fourth Installment: 100% of tax by March 15th

Event-Based Compliance Requirements

These requirements are triggered by specific events or changes within the LLP structure.

1. Changes in Partners or Designated Partners

• Form 4 (Notice of Appointment/Cessation of Partner/Designated Partner)
  • Due Date: Within 30 days of the change
• Form 4A (Notice of Change in Name/Address of Partner/Designated Partner)
  • Due Date: Within 30 days of the change

2. Changes in LLP Agreement

• Form 3 (Information with regard to LLP Agreement and changes)
  • Due Date: Within 30 days of the change

3. Changes in Registered Office

• Form 15 (Notice for Change of Place of Registered Office)
  • Due Date: Within 30 days of the change

4. Changes in Business Activities

• Form 3 (to update changes in main division of business activity)
  • Due Date: Within 30 days of the change

5. Supplementary LLP Agreement

• Form 3 (Information with regard to LLP Agreement and changes)
  • Due Date: Within 30 days of execution of supplementary agreement

Penalties for Non-Compliance

Non-compliance with statutory requirements can lead to significant penalties. Understanding these consequences is crucial for prioritizing compliance efforts.

1. Delayed Filing of Annual Return (Form 11)

• Penalty of ₹100 per day until the default continues

2. Delayed Filing of Statement of Account & Solvency (Form 8)

• Penalty of ₹100 per day until the default continues

3. Non-maintenance of Books of Accounts

• Penalty from ₹25,000 to ₹5,00,000 for the LLP
• Penalty from ₹10,000 to ₹1,00,000 for each designated partner

4. Income Tax Related Penalties

• Late filing fee under section 234F: Up to ₹10,000
• Interest under section 234A: 1% per month on unpaid tax
• Penalty for underreporting income: 50% of tax on underreported income
• Penalty for misreporting income: 200% of tax on misreported income

5. GST Related Penalties

• Late filing fee: ₹50 per day (maximum ₹5,000)
• Interest on delayed payment: 18% per annum

Digital Compliance: MCA Portal

In line with the Digital India initiative, most LLP compliances are now managed through the Ministry of Corporate Affairs (MCA) portal.

Key Features of Digital Compliance

1. Digital Signature Certificate (DSC): Required for designated partners to file forms electronically
2. DPIN (Designated Partner Identification Number): Mandatory for all designated partners
3. Electronic Filing: All statutory forms must be filed electronically on the MCA portal
4. Online Payment: Fees and penalties can be paid online through various payment gateways
5. Public Records: Filed documents become part of public records accessible to stakeholders

Steps for Digital Compliance

1. Registration on MCA Portal: Create user accounts for the LLP and its designated partners
2. Obtain DSCs: Designated partners must obtain valid Digital Signature Certificates
3. Apply for DPIN: Designated partners must have a valid DPIN
4. Form Submission: Complete the required forms with accurate information
5. Certification: Forms must be digitally signed by authorized designated partners
6. Fee Payment: Pay the prescribed fee through the online payment facility
7. Tracking: Use Service Request Number (SRN) to track the status of submissions

Compliance Requirements for Foreign LLPs

For LLPs in India with international connections or those operating as part of global structures, additional compliance requirements may apply.

1. FEMA Compliance

• Annual Return on Foreign Liabilities and Assets (FLA): Due by July 15th each year
• Form ODI-Part II: Annual Performance Report for LLPs with overseas investments

2. Transfer Pricing Compliance (if applicable)

• Form 3CEB: Report of international transactions with associated enterprises
  • Due Date: November 30th (extended from October 31st)
• Master File and Country-by-Country Reporting: For LLPs part of multinational groups
  • Due Date: Varies based on parent entity's financial year

3. RBI Reporting for Foreign Investment

• Form FOREIGN DIRECT INVESTMENT-LLP(I): For receipt of capital contribution
  • Due Date: Within 30 days of receipt
• Form FOREIGN DIRECT INVESTMENT-LLP(II): For disinvestment/transfer of capital contribution
  • Due Date: Within 60 days of receipt of funds

4. Beneficial Ownership Declaration

• Form BEN-1: Declaration by significant beneficial owner
  • Due Date: Within 30 days of acquiring significant beneficial interest

Best Practices for LLP Compliance Management

Implementing robust compliance management practices can help LLPs avoid penalties and operate efficiently.

1. Create a Comprehensive Compliance Calendar

Develop a detailed calendar with all applicable deadlines for your LLP. Include:

• Statutory filing dates
• Tax payment deadlines
• Annual obligations
• Quarterly requirements

2. Assign Clear Responsibilities

• Designate specific individuals for compliance tasks
• Implement a system of checks and balances
• Conduct regular training on compliance requirements

3. Maintain Updated Records

• Keep partner details current
• Document all changes to the LLP agreement
• Preserve financial records for the statutorily required period (minimum 8 years)

4. Implement Digital Solutions

• Use compliance management software
• Set up automated reminders for approaching deadlines
• Maintain digital backups of all filed documents

5. Conduct Periodic Compliance Audits

• Schedule quarterly internal compliance reviews
• Consider annual comprehensive compliance audits
• Address identified gaps promptly

6. Stay Updated with Regulatory Changes

• Subscribe to MCA notifications
• Follow updates from professional bodies (ICAI, ICSI)
• Attend professional development programs

7. Engage Professional Support

• Consult with legal and financial experts
• Consider outsourcing compliance management to specialized firms like Targolegal
• Leverage technology solutions for compliance tracking

How Targolegal Can Help

At Targolegal, we specialize in providing comprehensive compliance solutions for LLPs in India, with particular expertise in serving businesses with international connections in the US, UK, and Singapore markets.

Our LLP Compliance Services

1. Compliance Calendar Management

   • Customized calendars based on your LLP's specific requirements
   • Automated reminders for approaching deadlines
   • Regular updates on regulatory changes

2. Filing and Documentation Services

   • Preparation and filing of Annual Returns (Form 11)
   • Preparation and filing of Statement of Account & Solvency (Form 8)
   • Event-based filings (Forms 3, 4, 4A, 15, etc.)

3. Tax Compliance

   • Income Tax Return preparation and filing
   • GST compliance management
   • TDS compliance and returns

4. International Compliance Support

   • FEMA compliance for foreign investments
   • Transfer pricing documentation
   • Cross-border transaction advisory

5. Compliance Health Check

   • Comprehensive review of current compliance status
   • Gap analysis and remediation planning
   • Compliance risk assessment

6. Digital Compliance Solutions

   • DSC management for designated partners
   • Secure document repository
   • Digital record-keeping systems

7. Compliance Training

   • Workshops for partners and staff
   • Updates on regulatory changes
   • Customized compliance manuals

Conclusion

By maintaining strict adherence to the compliance calendar outlined in this blog, LLPs can focus on their core business activities without the worry of regulatory penalties or disruptions. At Targolegal, we're committed to helping your business navigate the complex compliance landscape efficiently and effectively. Contact us today to learn how we can support your LLP's compliance journey.

Get your free consultation now. visit TargoLegal today or chat now on +91-8095919197