BRIEF ON LLP :
The registration of a Limited Liability Partnership (LLP) offers a business structure combining limited liability and partnership flexibility. As a legal entity, it is fully accountable for its assets. Introduced in 2009 under the Limited Liability Partnership Act, it suits small and medium-sized enterprises. Incorporating an LLP requires a minimum of two partners with no upper limit. One partner is not liable for another’s misconduct or negligence. Partner rights and duties are governed by an agreement. An LLP cannot issue equity shares, making it unsuitable for raising equity funds.
ABOUT LLP COMPLIANCE
The partners in a Limited Liability Partnership (LLP) are responsible for maintaining accurate books of accounts, filing Income Tax returns, and submitting an annual return to the Ministry of Corporate Affairs each financial year.
To ensure the smooth continuity of the LLP, returns must be filed periodically to maintain compliance and avoid substantial penalties for non-compliance. Although LLPs have fewer compliance requirements compared to private limited companies, the penalty rates for LLPs are significantly higher.
LLPs are not required to audit their books of accounts unless their annual turnover exceeds INR 40 lakh or their capital contributions exceed INR 25 lakh. Therefore, an audit is not mandatory for LLPs below these thresholds
BELOW ARE THE REQUIRED PARAMETERS :-
- Preparation of Books of Accounts
- Preparation of Financial Statements
- Audit by Independent Auditor
- Annual ROC Return Filings
- Filing of Income Tax Return
- Maintenance of Statutory Registers
