• Sidharth Ravi

Audit Under LLP Act 2008


llp audit requirements


Audit under LLP Act, 2008


Audit under LLP Act, 2008 is mandatory only for those LLP's whose turnover exceeds ₹ 40 lakhs or the total contribution by the partners exceeds ₹ 25 lakhs. If the LLP crosses either of the threshold limits, they are required to get their accounts audited by a Chartered Accountant in practice. An LLP that crosses either of the threshold limits during any financial year needs to appoint a Chartered Accountant in practice as its Auditor 30 days before the end of the financial year. i.e. before 1st March of the Financial year.


Audit under Income Tax Act, 1961


Audit of Accounts under the Income Tax Act, 1961 for a Limited Liability Partnership is required when their turnover for a Financial year exceeds ₹1 crore. The LLP should file its tax audit report along with its Income tax return before 30th September every year for the previous financial year. A Chartered Accountant in practice can be appointed as Tax Auditor of an LLP.


Every Limited Liability Partnership has to file Income tax returns every year. In simple words, LLP is a separate legal entity so along with the partner’s income tax return, the income tax returns of the LLP also needs to be filed, which shows the Income and calculates the tax liability of the LLP. LLP's have to calculate their tax liability from their financial statements for the year. Mostly Income Tax Return the Last date is 31st July of the financial year (unless extended). However, in the case where an Audit is required, the last date for filing Income Tax returns is 30th September of the subsequent financial year. If the LLP has not carried any business during the year ended 31.03, the LLP has to file a NIL IT RETURN with Income Tax Authorities.


Annual Compliances for an LLP


Every LLP which is registered with the Ministry of Corporate Affairs (MCA) has to file its Annual Returns and Statement of Accounts for the Financial year. Here are three main compliances which should be complied with by all the designated partners of LLP:-

  • Preparation and filing of Annual Return under the LLP Act, 2008

  • Preparation and filing of Financial Statements of the LLP

  • Filing of Income Tax Returns under the Income Tax Act, 1961.


The majority of the partners are ambiguous to the fact that whether filings of the Annual Returns are the mandatory thing even if they are not doing the business? Yes, Every LLP has to be compliant even if there are no operations in the organization. It is the responsibility of the organization to file all the required documents even if there are no operations or business during the financial year.


Annual Returns for an LLP


Annual returns are mandatory filings that need to be complied with by all LLP's in India The annual return must be filed within the prescribed format with the Ministry of Corporate Affairs. The filing of annual returns with the MCA is different from the filing of annual returns with the tax department. The annual return of an LLP is due within 60 days of the close of the financial year. LLPs must uniformly maintain a fiscal year that starts on April 1st and ends on March 31st, therefore the Annual return of an LLP is due on or before May 30th of every financial year.

On the other hand, the Statement of Accounts and Solvency of an LLP is due within 30 days from the very best of six months of the close of the monetary year. Statement of Accounts and Solvency is a mandatory filing that is required for all LLPs in India.


Penalty for NON-Compliance of Audit under LLP Act


A Limited Liability Partnership that fails to comply with the above requirements shall be punishable with a fine which shall not be less than Rs. 25,000 but not exceeding Rs. 5,00,000. Every designated partner shall be punishable with a fine which shall not be less than Rs. 10,000 but not exceeding Rs. 5,00,000.


Penalty for Non-Filing of Form-11 under LLP Act


In case of a delay in filing Filing Form-11 and Form-8, a penalty of ₹100 per day would be levied until such filing. Also an LLP cannot be closed or wound up unless such returns are filed.


Apart from these monetary penalties, the registrar has the rights to strike off the name of the LLP's who have not filed Form-8 and Form-11 in the last 2 consecutive years.


It is also recommended that the LLP files both Form-11 and Form-8 within the due dates as the Registrar has the power to strike off the name of the LLP as well as the Designated partners could get their DPIN cancelled.


Due dates for filing Form-11 and Form-8


The due date for Filing Form-11 is on or before the 30th of May after the close of the financial year.


The due date for Filing Form-8 is on or before the 30th of October after the close of the financial year.


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