Mandatory Compliance for a Private Limited Company in India

Mandatory Compliances for a Private Limited Company in India

Incorporating as a Private Limited Company may be the most common way to launch a company, but doing so comes with a number of legal obligations. Any business owner will tell you that it can be hard to keep up with day-to-day operations and follow corporate rules at the same time.

So, it’s important to get help from a professional and learn about these legal requirements to make sure you meet them on time and don’t have to pay interest or a fine. Discover more annual compliance of private limited company.

We’ve outlined some of the most typical compliance’s a limited liability business must make below:

Compliance Requirement Description and Timeline
Appointment of Auditor Form must fill out in order to hire an auditor for 5 (Five) years. The first Auditor will be chosen within a month of the company being formed.
Statutory Audit of Accounts At the close of each fiscal year, all companies require to have their books audited by a chartered accountant.

The auditor will give the Registrar a report on the audit and the financial statements that have been reviewed by the auditor.

Filing of Annual Return Every private limited company has 60 days from the time it holds its Annual General Meeting until it sends in its Annual Return. This must be done.

The Annual Return will cover the time from April 1 to March 31.

Filing of Financial Statements Every Private Limited Company must file this form with the appropriate financial statements, such as a Balance Sheet, Profit and Loss Account, and Director’s Report, within 30 days of the Annual General Meeting.
Holding Annual General Meeting An Annual General Meeting must be held once a year . In most cases, annual meetings must be held no later than six months after the end of the fiscal year.
Preparation of Directors’ Report All of the details specified by Section 134 will include in the Directors’ Report.

Statutory Audit Compliance’s

Specifically Audits, including statutory audits, are done for the same reason as any other type of audit:

Find out if an organisation is telling the truth about its financial situation by looking at things like account balances, bookkeeping records, and financial transactions.

  • Company Statutory Auditors Sworn In.
  • Finish the Company’s Annual Accounts with the Auditors.

Annual ROC Filings

  • Private limited companies must send an Annual Accounts and Returns form to the Registrar of Companies every year. This form has information about the company’s shareholders, directors, and other officers. in addition You have to show this conformity once a year, moreover.
  • As part of Annual Filing, this must receive the following documents every year even more:
  • Within 60 days of holding their Annual General Meeting, Private Limited Companies must fill out and send in their Annual Return. The Annual Return will cover the time from April 1 to March 31.
  • Every Private Limited Company must file its Balance Sheet, Profit and Loss Account, and Director Report within 30 days of the Annual General Meeting (Financial Statements).

Annual General Meeting

  • Every Private Limited Company must hold a meeting of its shareholders at least once a year and no more than six months after the end of the fiscal year.
  • The most important things to discuss are the approval of financial statements, the payment of dividends, the appointment or re-appointment of auditors, and the appointment and pay of directors, among other things.
  • This must happen during regular business hours and on a day that is not a legal holiday. It must also happen at the registered office of the company or somewhere else in the city, town, or village where the registered office of the company is located.

Board Meetings

  • Every Private Limited Company must hold a meeting of its shareholders at least once a year and no more than six months after the end of the fiscal year.
  • The most important things to discuss are the approval of financial statements, the payment of dividends, the appointment or re-appointment of auditors, To demonstrate and the appointment and pay of directors, among other things.
  • Regular business hours and on a day that is not a legal holiday. It must also happen at the registered office of the company or somewhere else in the city, town, or village where the registered office of the company is located.

Directors’ Report

Specifically  A director’s annual disclosure must include information about any other firms in which he serves as a director.

Addition This must do annually from submitting a written statement to the corporation in the form of a Directors’ Report.

Income Tax Compliance’s

  • Income Tax Return, including Quarterly Advance Tax Payment (tax to be paid is 30% flat rate plus Education Cess)
  • A tax audit is required if a company’s sales, turnover, or gross revenues in the year before the assessment year were more than Rs. Ten Crore. When cash payments and receipts don’t make up more than 5% of total payments or receipts, the threshold limit goes up to Rs. 10 crore.
  • Sending in the Tax Audit Report

Maintenance of Statutory Registers and Records

Register of Shares, Register of Members, Register of Directors, etc.

Only a few examples of the statutory registers and records that a Private Limited Company require to keep by law.

Specifically  The Company must also keep its Articles of Incorporation, Board Resolutions, Board Meeting Minutes, Annual General Meeting Minutes, and other similar documents. Know more SEO.

further Members are welcome to look at these documents at the company’s main office during business hours. Also, all businesses must keep their books in order for at least eight fiscal years.

Other Event Based Compliance’s

In addition to the yearly reports, the company must also comply with a wide variety of regulations whenever applicable. Examples of such occurrences include:

  • Change in Authorised or Paid up Capital of the Company.
  • Issue or transfer of shares
  • lending money to other businesses
  • Financing Board Members with Loans
  • Appointment of Managing or whole time Director and payment of compensation.
  • Loans to Directors
  • In the same way Opening or shutting of bank accounts or change in signatories of Bank account.
  • Constitution or replacement of the Company’s Statutory Auditors.

All of these occurrences have their own unique forms and filing deadlines with the Registrar. Additional charges or penalties may impose if the same do not carry out. moreover, timely observance of such regulations is essential.

Non-Compliance

Companies and their officers who violate the Companies Act are fined as long as the infraction continues.
The longer you’re late, the higher the costs. Some Annual Filing Forms can be changed, but the fees are the same as a new filing.

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