Set to start the business as LLP? Don’t forget to check post compliance list. Your responsibility as a partner is beyond the LLP registration. And we are here to make your task simple. Make sure that you are informed about these terms and compliance.
You are set to start a business as soon as you receive the certificate
of incorporation. But, as a designated partner, your responsibilities do not
end there. Here is the complete compliance checklist for your reference.
PAN and TAN
Unlike companies, LLP cannot apply PAN and TAN in the registration
application. Once you receive the incorporation certificate, ensure to apply
for PAN and TAN. If it’s registered with LegalWiz.in, stay relaxed. We have
already fulfilled this for you.
We make sure to file LLP agreement with MCA on time. However, many
overlook this rule. You must register it with MCA within 30 days of
incorporation. Note that per day of delay costs you INR 100.
These two steps come along registration
process only. Hence, this is where the
post-registration checklist starts.
Opening an account is the first thing that strikes your mind after
registration. Yes, that is first in the checklist too. The bank account is
necessary to route all transactions of LLP.
You need to submit the documents as per the bank’s policy. For your
quick reference, I’m enlisting primary documents needed.
- Certificate of Incorporation
- PAN Card
Every partner must have agreed on a capital contribution. Therefore,
they need to deposit the capital in a given manner. It should also be meeting
the timelines for instalments if any.
A partner can make a contribution in cash or kind. However, in most
cases, the mode of contribution is already agreed by partners. The contribution
is further disclosed in accounts and reported in the annual filings.
Well, maintaining records of transactions is necessary for any
business. And it is mandatory for an LLP. Unlike a company, there is no
prescribed schedule for accounts. So, you can maintain accounts on an accrual
or cash basis.
It is also required to maintain books at the registered office up to
prescribed time. However, it is quite simple nowadays. You can opt for
cloud-based accounting and maintain accounts in soft copies.
Audit is applicable after exceeding thresholds prescribed. Here are
- Turnover: 40 Lakh
- Contribution: 25 Lakh
If you cross any of the two limits, you must appoint an auditor. The
auditor must be a practising Chartered Accountant. The partners can decide the
auditor for the appointment. If audit it
applicable, the audit report is filed with ITR, latest by 30th September of
require other registrations?
This is the most crucial point, which many businesses fail to address.
LLP registration is only business setup. You may require different licenses or
registrations for business. Although need varies as per business nature, here
is a general list.
Shop & Establishment
registration: Also known as Gumastadhara, it is registration with local
authorities. Applicability is based on the State laws.
Professional tax registration:
Similar to S&E, applicability is based on the State laws.
GST registration: Apart
from compulsory registration, you can register under GST voluntarily as well.
I’m providing conditions where it is mandatory to register.
- If the total business turnover exceeds INR 20
Lakh in the concerned financial year (the threshold for the North-eastern
States is INR 10 Lakh)
- Casual taxable person / Non-Resident taxable
- Agents of a supplier & Input Service
- Electronic Commerce Aggregator
- The person supplying through an E-commerce
This is not an exhaustive list. There are certain other criteria where
registration is mandatory.
registrations: Based on the business
activity, you need to get registration with the appropriate authority. For
example, if your business activity includes import or export of goods, you must
have obtained IEC registration. Similarly, you will need an FSSAI license for a
PF & other labour laws
Labour Laws protect the employees. Hence, as a business owner, you
need to understand the Labour Laws. These are few important regulations to
observe amongst the various:
- Provident funds,
- Minimum wages,
- Payment of wages,
- Employees State Insurance (ESI), and
- The Bonus Act
PF regulations apply to the businesses employing 20 or more persons.
An employee (skilled or unskilled) can become a member if it is drawing pay up
to INR 15,000.
Further, ESI applies to the manufacturing factories with 10 or more
employees. Here, the wage limit is Rs 21,000.
The business owners similarly need to address the applicability of all
other relevant laws.
Businesses are becoming cognizant about their IP protections for a high
level of competition. Dynamic with highly responsive social media also create
theft for faster-growing businesses. Therefore,
IP registrations are important not only to stand out but also to provide legal
backing. IP is an asset to any startup since it has a commercial value. Basically,
there are three laws through which a startup can protect its IPR.
Trademark – It is a reflection of your brand and infringement of your brand can cost your business dearly. It protects a logos, symbol, taglines, etc.
Copyrights – If you are creating original or artistic works and content, consider protecting under Copyright. It could be a musical composition, painting, website, write-up, etc.
Patents – Do you find your product or process is true to test of invention? If yes, you must get your invention protected under Patents.
The dynamic business culture needs standard policies and processes in
place. Those support the business to grow from the start. Tech-based and
service-based businesses specifically require a Non-Disclosure Agreement (NDA).
If you have an online presence through a domain, you must draft
Co-founders agreement, which is quite common in companies, is not
required here. This is because the LLP agreement itself provides roles and
responsibility of partners, and other important clauses as well.
How LegalWiz.in can be helpful?
The compliances are continuous in nature. Many event-based compliances and annual compliances are recurring in nature. Our team of experts assist you to understand the applicability as well as the need for such compliances. With LW as your legal partner, rest assured about your compliance needs. We make sure that your business is compliant all-time.
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