LLP Annual Compliance Checklist for Busy Founders
LLPs are often promoted as a low-compliance business structure, and while that is true compared to Private Limited Companies, LLPs still have mandatory annual filings that cannot be skipped. Missing these deadlines results in daily penalties that accumulate quickly, and prolonged non-compliance can lead to your LLP being struck off by the Registrar. This checklist-style guide covers everything you need to know about LLP annual compliance, organized by deadline so you can plan ahead.
LLP Compliance at a Glance
| Compliance | Form | Due Date | Filed With |
|---|---|---|---|
| Annual Return | Form 11 | May 30 | ROC (MCA Portal) |
| Income Tax Return (no audit) | ITR-5 | July 31 | Income Tax Department |
| Partner KYC | DIR-3 KYC | September 30 | MCA Portal |
| Tax Audit Report (if applicable) | Form 3CA/3CB + 3CD | September 30 | Income Tax Department |
| Statement of Account and Solvency | Form 8 | October 30 | ROC (MCA Portal) |
| Income Tax Return (with audit) | ITR-5 | October 31 | Income Tax Department |
| GST Annual Return (if GST registered) | GSTR-9 | December 31 | GST Portal |
Form 11: Annual Return
Form 11 is the LLP's Annual Return filed with the Registrar of Companies. It provides a comprehensive snapshot of the LLP's partner structure and is due within 60 days from the close of the financial year (by May 30 for LLPs with March 31 year-end).
What Form 11 Contains
- LLP name, registration number, and registered office address
- Details of all partners: name, DPIN/DIN, date of joining, contribution
- Details of partners who have ceased to be partners during the year
- Summary of contributions received from each partner
- Details of any body corporate partners
Who Signs Form 11
- At least one designated partner digitally signs the form
- If total obligation of contribution exceeds Rs. 50 lakhs or annual turnover exceeds Rs. 5 crore, the form must be certified by a Company Secretary in Practice (CS)
- If the LLP has any body corporate partners, CS certification is required regardless of turnover
Form 8: Statement of Account and Solvency
Form 8 is the financial statement filing for LLPs, providing details of the LLP's assets, liabilities, income, and expenditure. It is due within 30 days from the end of 6 months after the close of the financial year (by October 30).
What Form 8 Contains
- Statement of Assets and Liabilities: Current assets, fixed assets, current liabilities, and long-term liabilities as on March 31
- Statement of Income and Expenditure: Revenue, expenses, and net profit or loss for the financial year
- Solvency statement: Declaration by designated partners that the LLP is solvent and capable of meeting its debts
Audit Requirement for Form 8
| Condition | Audit Required? | Certification |
|---|---|---|
| Turnover up to Rs. 40 lakhs AND contribution up to Rs. 25 lakhs | No | Signed by designated partners only |
| Turnover exceeds Rs. 40 lakhs OR contribution exceeds Rs. 25 lakhs | Yes | Signed by designated partners + certified by CA |
Income Tax Return
Every LLP must file an Income Tax Return in ITR-5, regardless of whether it had business activity, profit, or loss during the year.
Key Tax Details for LLPs
- Tax rate: 30% on net income + 4% Health and Education Cess
- Surcharge: 12% if net income exceeds Rs. 1 crore
- Alternate Minimum Tax (AMT): 18.5% + cess (applicable if normal tax liability is less than AMT)
- Partner's share of profit: Exempt in the hands of partners under Section 10(2A)
- Interest on capital: Deductible for the LLP at up to 12% per annum; taxable for partners as income from other sources
Due Dates
- Without audit: July 31 of the assessment year
- With audit (turnover > Rs. 40 lakhs or contribution > Rs. 25 lakhs): October 31 of the assessment year
- Advance tax: Quarterly installments if estimated tax exceeds Rs. 10,000
GST Compliance (If Applicable)
LLPs that are GST registered must file regular GST returns:
- GSTR-1: Monthly outward supply details (by the 11th of the following month)
- GSTR-3B: Monthly summary return with tax payment (by the 20th of the following month)
- GSTR-9: Annual return (by December 31)
- GSTR-9C: Reconciliation statement if turnover exceeds Rs. 5 crore (by December 31)
LLPs with annual turnover up to Rs. 5 crore can opt for the QRMP (Quarterly Return Monthly Payment) scheme, which allows them to file GSTR-1 and GSTR-3B quarterly instead of monthly. This significantly reduces the compliance burden for smaller LLPs.
Partner KYC (DIR-3 KYC)
Every person holding a DPIN or DIN must file DIR-3 KYC by September 30 every year. This is a separate, personal filing not connected to the LLP's filings.
- What it verifies: Name, PAN, Aadhaar, residential address, email, mobile number
- Late filing penalty: Rs. 5,000
- Consequence of non-filing: DPIN gets deactivated, and you cannot sign any MCA forms
- First-time filer: Web form with OTP verification on email and mobile
- Repeat filer (no changes): Simplified update form without professional certification
LLP vs Private Limited: Compliance Comparison
| Aspect | LLP | Private Limited Company |
|---|---|---|
| ROC Forms | Form 8 + Form 11 | AOC-4 + MGT-7A + ADT-1 |
| Audit | Only if turnover > Rs. 40L or contribution > Rs. 25L | Mandatory for all companies |
| Board Meetings | Not mandatory | Minimum 4 per year |
| AGM | Not required | Mandatory every year |
| Tax Rate | 30% + cess | 25% + cess (for most companies) |
| Statutory Registers | Fewer registers required | Multiple registers mandatory |
| Overall Compliance Burden | Lower | Higher |
Penalties for Non-Compliance
- Late filing of Form 8 or Form 11: Rs. 100 per day of delay, per form, with no cap
- Late filing of ITR-5: Rs. 5,000 late fee (Rs. 1,000 if net income is under Rs. 5 lakhs) plus interest under Section 234A, 234B, and 234C
- DIR-3 KYC not filed: Rs. 5,000 per designated partner + DPIN deactivation
- LLP strike-off: If Form 8 and Form 11 are not filed for 2+ consecutive years and no business activity is carried on
- Revival of struck-off LLP: Requires NCLT application with significant legal fees (Rs. 1 lakh+)
Conclusion
LLP compliance is simpler than that of a Private Limited Company, but it is not optional. The three core filings, Form 8, Form 11, and ITR-5, must be done every year regardless of business activity. Add DIR-3 KYC for all partners and GST returns (if registered), and you have your complete annual compliance checklist. The best approach is to set calendar reminders for each deadline and engage a qualified CA or CS to handle the filings accurately.
IncorpX offers affordable LLP compliance packages that cover all mandatory filings, ensuring your LLP stays compliant and penalty-free throughout the year.
Frequently Asked Questions
What are the mandatory annual compliances for an LLP?
Every LLP must file: Form 8 (Statement of Account and Solvency) within 30 days from the end of 6 months of the financial year (by October 30), Form 11 (Annual Return) within 60 days from the close of the financial year (by May 30), and Income Tax Return (ITR-5) by October 31 (if audit is required) or July 31 (if audit is not required).
Is audit mandatory for all LLPs?
No, audit is not mandatory for all LLPs. Audit is required only if the LLP's annual turnover exceeds Rs. 40 lakhs or contribution exceeds Rs. 25 lakhs. LLPs below these thresholds are exempted from audit requirements but must still file Form 8, Form 11, and Income Tax Return.
What is the penalty for late filing of Form 8 or Form 11?
Late filing attracts a penalty of Rs. 100 per day of delay per form, with no upper cap. If Form 8 is late by 90 days, the penalty is Rs. 9,000. If both Form 8 and Form 11 are late by the same period, the combined penalty is Rs. 18,000. Continued non-compliance can lead to LLP strike-off.
Does a dormant LLP need to file annual compliance?
Yes, even dormant or non-operational LLPs must file all annual compliances including Form 8, Form 11, and Income Tax Return. Many founders mistakenly believe that an inactive LLP has no compliance obligations, but the filing requirements apply regardless of business activity.
What is Form 8 for LLPs?
Form 8 is the Statement of Account and Solvency filed by every LLP with the Registrar. It includes the LLP's financial position, assets, liabilities, income, and expenditure. It must be signed by at least 2 designated partners and certified by a CA (if audit is applicable).
What is Form 11 for LLPs?
Form 11 is the Annual Return filed by every LLP with the Registrar. It contains details about the LLP's partners, their contribution, and any changes during the year. If the LLP has partners who are body corporates or if total obligation of contribution exceeds Rs. 50 lakhs, it must be certified by a Company Secretary in Practice.
Does an LLP need to hold meetings like a company?
No, LLPs are not legally required to hold Board Meetings or Annual General Meetings. LLPs are governed by the LLP Agreement, which may specify meeting requirements. However, it is good practice to have periodic partner meetings and document key decisions.
What tax return does an LLP file?
LLPs file ITR-5. The tax rate for LLPs is 30% on net income plus 4% cess. If net income exceeds Rs. 1 crore, a surcharge of 12% is applicable. LLPs do not have to pay Dividend Distribution Tax since partners' profit shares are exempt under Section 10(2A).
Can an LLP be struck off for non-compliance?
Yes, the ROC can strike off an LLP if it has not filed Form 8 and Form 11 for two or more consecutive financial years and has not carried on any business for the preceding two years. Struck-off LLPs can be revived but the process is expensive and time-consuming.
What is DPIN and does it need annual filing?
DPIN (Designated Partner Identification Number) is the unique ID for LLP partners, similar to DIN for company directors. Every DPIN/DIN holder must file DIR-3 KYC annually by September 30. Failure to file results in DPIN deactivation and a late fee of Rs. 5,000.
