A Private Limited Company has the major characteristics of being a separate entity, having perpetual succession and limited liability. Unlike the sole proprietorship, partnership and limited liability partnership firm, the Private Limited Company involves more compliances.
Mandatory Compliances for Private Limited Company
- Appointment of Auditor
As according to the businesses Act, 2013, each non-public confined organization wishes to hire an auditor within 30 days of its incorporation. Consequently, this auditor shall keep the office till the beginning of the primary Annual widespread meeting. Further, appointing an auditor requires the filing of shape ADT-1. - Submitting of financial Statements
Every personal restricted organization has to file its balance Sheet, the statement of earnings and Loss Account in addition to the Director file in this shape within 30 days of protecting the annual widespread meeting. - Annual ROC Returns Filing
Each personal limited enterprise is needed to report its Annual return within 60 days of preservation of Annual preferred assembly. In addition, as the call indicates, Annual submitting is for the duration – 1st April to thirty first March of the relevant financial year. - Maintaining of Annual Trendy Meeting
Each organization has to keep an Annual fashionable meeting on or before 30th September every year throughout enterprise hours (nine am to six pm), on a day that isn't a public vacation. In addition, the preservation of the meeting must be both in the registered workplace of the enterprise or in the town, metropolis or village wherein the registered office is situated. but, the agency has to have a 21 clean days’ notice to behave at this trendy meeting. - Board meeting
In particular, there needs to be preservation of the first meeting of the Board of administrators within 30 days of the Incorporation of the business enterprise. Moreover, every director must have a word of the meeting at least 7 days before the meeting.
Tax related compliances for Private Limited Company
Income Tax Return Filing
A private limited enterprise has to document annual income Tax. Therefore, it is able to file ITR through shape ITR-6 or ITR-7.
ITR-6: ITR-6 is to be filed with the aid of Indian organizations, apart from the ones claiming exemption below section 11 of the profits Tax Act.
ITR-7: ITR-7 is to be filed for individuals including corporations who are required to grant returns usa139 (4A) or phase 139 (4B) or segment 139 (4C) or phase 139 (4D)
- GST Filing: The private restricted agency has to achieve GST Registration if the turnover of the agency exceeds Rs. 20 lakhs in a yr. Thereafter, on acquiring GST Registration, it has to report GST Returns. As in keeping with the GST laws, the non-public constrained business enterprise has to document GST returns specifically – GSTR-1 and GSTR-3B; monthly or quarterly and GSTR-nine. These returns contain the details of the outward and inward substances at the side of the tax paid by means of the company. but, if the corporation has opted for the composition scheme, then it wishes to record GSTR-4.
- TDS return filing: The TDS is to be filed wherein the business enterprise has a legitimate TAN and the sort of return to be filed depends upon the motive of deduction.
The numerous types of TDS are:
first of all - TDS on revenue – shape 24Q
Secondly - shape for TDS where deductee is a non-resident, overseas employer – shape 27Q
Thirdly - TDS on fee for the transfer of immovable belongings – form 26QB
ultimately, another case – shape 26Q - EPF submitting: The employer is needed to get EPF registration if it employs extra than 10 men and women. Hence, submitting of EPF will become obligatory.
- Accounting & Bookkeeping: The personal confined enterprise has to maintain books of account, either if the income/turnover/gross receipts from the enterprise are extra than Rs. 25,00,000 or the income from the business is greater than Rs. 2,50,000 in any of the 3 previous years.
- Tax Audit: A private restricted enterprise is needed to have a tax audit accomplished if the sales, turnover or gross receipts of the enterprise exceed Rs. 5 crore within the monetary year. Apart from this, there can be a requirement to audit the agency on certain different occasions also.
Event based compliances of Private Limited Company
Besides the mandatory and tax compliances, there are various other compliances that a private constrained agency need to comply with on prevalence of any occasion within the organization.
Here are specific instances of such events:
- Change in the authorized capital or the paid-up capital of the company.
- Allotment of new shares or transfer of new shares
- Giving loans to other companies
- Giving loans to directors
- Appointment of managing or whole-time Director and their payment
- Change in signatories in case of opening or closing of the bank account.
- If there is an appointment or change of the statutory auditors of the company.
Documents required for the compliance of Private Limited Company
The documents required are:
- Details of sales and purchases made during the relevant financial year,
- Details of expenses made during the relevant financial year,
- Bank statements,
- Credit card statements, if any,
- Details of TDS deposited and deducted,
- Balance sheet of the company,
- Profit and Loss Account, and
- Lastly, the list of shareholders
Frequently asked Questions
Annual compliances are mandatory irrespective of the size and turnover of the company. The non-compliance would result in
- Very high penalties
- Prosecution
- Bank and investors won’t fund
- Disqualification as a director
Yes Statutory Audit, Secretarial Compliance and Income Tax return are mandatory.
Secretarial Filings, Statutory Audit and Income Tax Return are mandatory even if you have zero revenues.
A private limited company must hire an auditor, no matter what its revenues are. In fact, there must be an appointment of an auditor within 30 days of incorporation of the company.
Late filing for non filing of Income Tax Return for a private limited company attracts a penalty which is twelve times more than the normal fees.
Let's start working together!
Trust our experience to manage your business.
