Private Limited Company Compliances

Private Limited Company Compliances

The term compliance describes the ability to comply with orders, a set of rules, or requests.

A private limited company that has been incorporated in India must ensure the compliances concerning the Companies Act, 2013 are adequately met.

The Companies Act, 2013 regulates the appointment, qualification, remuneration, and retirement of the Company's Directors and other aspects such as conducting board meetings and shareholder meetings.

The RoC compliance for registered Private Limited Companies is necessary. The company must comply with the annual compliance requirement regardless of the total turnover or the capital amount.

All companies registered in India like a private limited company, one person company, limited company, and section 8 company need to maintain the annual compliances like annual returns and income tax return each year. Though company registration is the most popular form of starting a business, various compliances need to be followed once the business is Incorporated.

Managing the business's everyday operations while complying with the problematic corporate laws can be a task for the entrepreneur. So, it is always better to take the professionals' help and understand the legal requirement to ensure timely fulfilment of these compliances to waive off the penalties or fines.

Here, we will look at some of the Common compliances that a private limited company has to ensure mandatorily.

What are compliances to be maintained by the Private Limited Company?

The compliance requirement for Private Limited Company has changed drastically over the years. Following is the summary of the private limited company compliance due dates in 2021.

Compliance

Description

Commencement of business ( within 180 days)

For companies registered in India after November 2019, having a share capital, it is necessary to obtain a commencement if business certificate before commencing any business or exercising the borrowing powers. The commencement of business certificate must be obtained within 180 days of incorporating a Company.
In case the individual fails to obtain this certificate, there is a penalty of Rs. 50,000 for the company Rs. 1000 per day for the directors for each day of default.

Auditor Appointment (Within 30 days)

All registered Indian Companies must appoint a Statutory auditor within 30 days of incorporation. If the company fails to appoint an auditor, the company won't be allowed to commence business. Also, there is a penalty of Rs. 300 per month.

Income Tax Return

Income tax returns need to be filed on or before 30th September 2021 for the Financial year 2020-21.

MCA Form AOC-4

The registered private limited companies must file MCA Form AOC-4 on or before 30th November 2021 for the FY2020-21. Failure to file AOC-4 will attract a penalty of Rs. 200 per day of default or delay.

MCA Form MGT-7

It is necessary to file MCA form MGT-7 on or before 31st December 2021 for FY2020-21. Failure to file MGT-7 attracts a penalty of Rs.200 Per day of default or delay.

DIN eKYC

All the directors of the company must be filed for the DIN eKYC or DIR-3 eKYC. In DIR-3 eKYC, the Director must provide a unique personal mobile number and a personal email address. There's a penalty of Rs. 5000 in case of failure to file DIN eKYC.

Hold Annual General Meeting

It is mandatory for a private limited company to hold an annual general meeting once a year. Companies are required to keep their AGM within six months from closing the Financial year.

Director's report

Preparation of the Directors report will be done with all the information required under Section 134.

 

Created & Posted by (Ramesh Kumar Gupta)

Senior Accounts Manager at TAXAJ

 

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