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  • Sumeet Mahajan

Limited Liability Partnership (LLP) Annual Filing

LLP Annual Filing is a mandatory task for every Limited Liability Partnership (LLP). It involves filing out and submitting two returns i.e. Form 11 and Form 8 to the Registrar of Companies every year. Filings these returns forms regularly is necessary to comply with the law and avoid hefty penalties. LLPs have fewer yearly compliance requirements compared to private limited companies, but the penalties for non-compliance can be very high.

The LLP Annual filings of Returns must be filed electronically with the Ministry of Corporate Affairs, and it's crucial to ensure all information provided is accurate because there's no option for resubmission. Regardless of business activity, revenue or management changes, LLP must submit their Annual Returns and Financial Statements to the Ministry of Corporate Affairs (MCA).

Benefits of LLP Annual Filings Compliances

Regular Compliances of LLP Annual Filings benefits the LLP in followings ways:

Enhanced Credibility:

Annual compliance boosts the organization's credibility, making it easier to secure loans or meet similar requirements.

Financial Track Record:

LLPs annual compliance Filings create a financial track record that can attract new investors and interest from other companies.

Active Status and Avoiding Penalties:

Keeping up with regular return Filings prevents LLPs from being labeled as inactive and facing penalties. Failure to comply with annual Filings compliance requirements incurs additional fees.

Conversion or Closure:

Regular annual return Filings simplify the process of converting LLPs into different types of companies and speed up dissolution procedures for partnerships.

LLP Annual Filings Compliances

LLPs must comply with certain regulations. They must keep accurate accounts and submit an annual return to the Ministry of Corporate Affairs (MCA).

LLPs don't need to audit their accounts unless their turnover exceeds Rs.40 lakhs or their contribution is over Rs.25 lakhs. This simplifies the Filings process.

They must submit their Statement of Account & Solvency within 30 days from the end of six months of the financial year, and the Annual Return within 60 days from the end of the financial year.

Unlike companies, LLPs must follow the financial year from April 1st to March 31st. Therefore, the Form 8 i.e. Statement of Account & Solvency must be filed by October 30th, and the Form 11 i.e. annual return by May 30th each year, even if the LLP hasn't conducted any business, these annual return Filings are mandatory regardless of business activity has started or not.

Types of LLP Annual filing return forms

  1. Filings of annual return (Form 11)

  2. Statement of Accounts (Form-8)

  3. Income Tax Return (ITR)

Filings of annual return (Form 11)

The LLP annual return, also referred to as Form 11, summarizes information about all designated partners and indicates any changes in the LLP's management. It's mandatory for every LLP to submit Form 11 annually to the Registrar within 60 days after the end of the financial year, meaning by May 31st each year.

Filings Form 11 will not be possible if there are any pending payments or processing of e-form 4 (Notice of appointment, cessation, and change in designation of a designated partner or partner) with the MCA. Thus, it's crucial to complete any pending e-form 4 well before the LLP Annual Return's due date.

Failure to file LLP return Form 11 Annual Return by the due date of May 31st will result in a penalty of Rs.100 per day until compliance is achieved. Since there's no limit on the penalty, the amount will accumulate over time. Therefore, it's essential to file on time to avoid hefty penalties.

Information & Document Required to File LLP Form 11

To file the LLP Annual Return, the following information and documents are necessary:

1. LLP Identification Number

2. LLP Name

3. Registered office address of the LLP

4. Business Classification of the LLP (Business,Profession,Service,Occupation,Others)

5. Principal business activities of the LLP

6. Details of Designated Partners and Partners of the LLP

7. Total contribution obligation of partners of the LLP

8. Total contribution received from all partners of the LLP

9. Summary of Designated Partners and Partners

10. Details of any penalties imposed on the LLP, if applicable

11. Information on any compounded offenses, if applicable

12. Details of any other LLP or company where Partner/Designated Partner holds a Director/Partner position (This information must be attached if any Partner/Designated Partner holds such positions elsewhere).

Statement of Accounts (Form-8) Filing

Every LLP is required to finalize its books of accounts for March 31st ended year and prepare the Balance Sheet and Profit and Loss statement. These finalized books of accounts details needs to be submitted annually in Form 8. Form 8, also known as the statement of account and solvency, is a return Filing form that all LLPs registered in India must submit annually to the Ministry of Corporate Affairs (MCA). Regardless of the LLP's turnover, Form 8 must be filed with the MCA.

At least two designated partners must submit Form 8 to the Registrar. Form 8 must be completed and submitted by October 30th. Failure to do so may result in a penalty of Rs.100 per day until the Filing is completed.

What additional information needs to be provided along with Form 8?

Form 8, known as the Statement of Account and Solvency, outlines the financial activities and position of an LLP during the financial year. Along with this, the LLP must declare:

• Whether its turnover exceeds or falls below Rs. 40 lakhs.

• Confirmation of previously filed statements regarding the creation, modification, or satisfaction of charges up to the current financial year.

• Assurance that partners or authorized representatives have diligently prepared and maintained the accounts.

What are the attachments to Form 8?

The following documents must be attached with Form 8:

• Disclosure under Micro, Small and Medium Enterprises (MSME)

Development Act, 2006 is a mandatory attachment.

• Statement of contingent liabilities to be attached in case any

contingent liability exists.

• Any other relevant information can be provided as

an optional attachment.

Who needs to authorize Form 8?

Form 8 is a document that requires digital signatures from at least two Designated Partners of an LLP or Authorized Representatives of a Foreign LLP if the LLP's turnover is equal to or less than Rs 40 lakh, or the partner's contribution is equal to or less than Rs 25 lakh.

However, if the LLP's turnover exceeds Rs 40 lakh or the partner's contribution surpasses Rs 25 lakh, then Form 8 must be certified by the LLP's/FLLP's auditor.

Procedure to file LLP Form 8

1. Download the Form:

Access the Form from the MCA website, ensuring you follow the

provided instructions.

2. Find your LLPIN:

Enter your LLP name to locate the LLPIN associated with your LLP from

the MCA records.

3. Pre-fill Form 8:

Utilize the pre-fill feature to input the relevant details such as the

reporting year and periodicity (annual or interim). Basic information

up to Part A point no. 1 will be auto- populated. The total

capital contribution as of the specified date will be automatically

displayed based on your Form 11 - Annual Return.

4. Complete Statements:

Fill in the Statement of Accounts and the Statement of Income

and Expenditure using the pre-filled information. Use "0" where

no quantity is applicable.

5. Attach Documents:

Upload the necessary files and attachments as instructed.

6. Review and Sign:

Double-check the form for any errors before submission.

Add your digital signature to authenticate the form,

then click Submit.

7. Submit and Pay:

Upload the form and proceed with the required transaction

fee payment. Keep note of the generated SRN number for

future reference.

Income Tax Return (ITR) Filing

Limited Liability Partnerships (LLPs) have gained popularity as a flexible and advantageous form of business structure in India. LLPs offer a blend of corporate and partnership features, making them an attractive option for many entrepreneurs. However, like any other business entity, LLPs are subject to taxation regulations in India. Understanding the rules and procedures for filing Income Tax Returns (ITR) annually is essential for LLPs to ensure compliance and avoid penalties.

1. Understanding LLP Income Tax

• LLPs in India are taxed as separate legal entities, distinct

from their partners.

• LLPs are subject to income tax under the Income Tax Act, 1961,

and the rules laid out by the Ministry of Corporate Affairs (MCA)

and the Income Tax Department.

• LLPs are required to file their income tax returns annually,

irrespective of whether they have taxable income or not.

2. Eligibility for LLP Income Tax Filing

• Every LLP registered under the Limited Liability Partnership Act,

2008, is required to file income tax returns.

• LLPs with annual turnover exceeding Rs. 40 lakhs or whose

contribution exceeds Rs. 25 lakhs are mandated to get

their accounts audited under the Income Tax Act. Such

LLPs need to file Form 3CD along with their income tax returns.

3. Types of LLP Income Tax Forms

• LLPs are required to file income tax returns using Form ITR-5,

which is specifically designed for LLPs.

• The form must be filed electronically on the Income

Tax Department's official website within the due date

specified by the authorities.

4. Documents Required for LLP ITR Filing

• Financial statements, including Profit and Loss Account and

Balance Sheet.

• Statement of Partners' Capital.

• Auditor's Report (if applicable).

• Tax audit report in Form 3CD (if applicable).

• PAN card and Aadhaar card details of partners.

• Bank statements and other financial records.

5. Steps for LLP ITR Filing

• Obtain digital signature certificates (DSCs) for designated

partners to sign the LLP's tax return electronically.

• Prepare financial statements and tax computation.

• Complete Form ITR-5 with accurate details of income, deductions,

and tax liability.

• Attach necessary documents and tax audit reports (if applicable).

• Verify and digitally sign the ITR using DSCs.

• Submit the ITR electronically on the Income Tax Department's

• Receive acknowledgment and keep it safely for future reference.

6. Important Deadlines

• LLPs must file their income tax returns by the due date specified

by the Income Tax Department, usually July 31st of the

assessment year.

• Late filing of returns attracts penalties and interest charges,

so it's crucial to adhere to the deadlines.

7. Penalties for Non-compliance:

• LLPs failing to file their income tax returns within the due date

are liable to pay a penalty under Section 234F of the Income Tax Act.

• Late filing penalties range from Rs. 1,000 to Rs. 10,000,

depending on the delay period and the LLP's turnover.

Filing Income Tax Returns is a crucial obligation for LLPs in India to ensure compliance with taxation laws. By understanding the rules and procedures outlined by the Income Tax Department, LLPs can fulfill their tax obligations efficiently and avoid penalties. Adhering to deadlines, maintaining accurate financial records, and seeking professional assistance when necessary are key practices for smooth LLP ITR filing in India.


Equal Rights

This is an LLP with two or more partners having equal rights/powers with respect to profits/losses as well as decision-making authority (1:1 basis). This type of agreement will be applicable if all partners in an LLP contribute equally to the LLP and have the same rights including management rights. In this type of LLP, all partners will be working partners and receive the same remuneration.

 LLP Agreement wherein rights are in the ratio of contribution and profit share

Absolute Rights

If an LLP is incorporated with by two persons and only one person is appointed as the nominee or in some cases only as the investor. The agreement needs to be drafted in such a way that one person will get all the management as well as decision making power.

Equal Right and Differential Power

An LLP with more than two partners, each having equal rights, is an Equal Rights LLP. For operational efficiency, this type of LLP agreement typically delegates specific powers to selected partner(s), subject to receiving unanimous consent from all partners. In this type of LLP, partners have equal rights in all aspects; however, by an LLP Agreement, some specific powers are given to particular partners.

Husband & Wife

An LLP with a husband and wife as partners; such an agreement can have a structure similar to any of the three LLP agreements listed above. Additionally, a special agreement pertaining to tax liability given the LLP partners’ personal relationship is required. We have structured this type of LLP Agreement to meet their goals to minimum family tax liability.

Board Managed

This is an LLP with multiple partners and the business is managed by a committee of partners, similar to a company’s Board of Directors. While overall control is exercised by all LLP partners, day-to-day management and decision-making is handled by the committee/board.

Frequently Asked Questions

Ques: Is Professional Certification necessary for Filings Form 11?

Ans: Professional certification may be necessary under certain

circumstances. If the LLP's annual turnover exceeds

Rs.5 crores or if partners' capital contributions surpass

Rs.5 lakhs in a single year, professional certification

might be required.

Ques: Are all LLPs required to file ITR?

Ans: Yes, all Limited Liability Partnerships (LLPs) registered in

India must file Income Tax Returns (ITRs) annually, irrespective

of whether they have taxable income or not.

Ques: What documents are necessary for LLP ITR Filings?

Ans: The documents needed for LLP Income Tax Return (ITR) Filings are:

• Financial statements like the Balance Sheet, Profit and Loss Account,

and Auditor's Report (if applicable).

• Partner details, including their PAN (Permanent Account Number)

and capital contributions.

• Bank statements and supporting documents for

income and expenses.

• Any other relevant documents concerning income, deductions,

taxes paid, etc.

Ques: What are the consequences of missing the LLP ITR deadline?

Ans: If you miss the LLP Income Tax Return (ITR) Filings deadline, you may

face penalties and late fees imposed by the Income Tax

Department. The penalty for late Filings can range from ₹5,000

to ₹10,000, depending on the delay. Additionally, interest

may be levied on any outstanding tax liability.

Ques: How can I check the status of my Form 11 Filings?

Ans: LLPs can track the status of their Form 11 Filings using the Service

Request Number (SRN) generated upon submission. This SRN

acts as a reference for future correspondence with

the Ministry of Corporate Affairs (MCA) and enables monitoring

of the Filings process's progress.

Ques: Can the deadline for Form 11 Filings be extended?

Ans: In exceptional circumstances or unforeseen events,

the Registrar of Companies may grant extensions for

Filings annual returns. However, such extensions are subject

to specific conditions and require an application by the LLP.

Ques: What are the penalties for non-compliance with Form 11 and Form 8 Filings requirements?

Ans: Failure to adhere to the prescribed due date for Filings Form 11

may result in penalties of ₹100 per day of delay, with no

maximum limit.

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