LLP Registration
Limited liability partnerships (LLPs) are required to meet fewer criteria for compliance on filing annual returns, in comparison to private limited companies. LLPs are required to provide information related to the statement of accounts, and returns, on an annual basis. Penalties, however, are huge for failure to comply. Entities that don’t provide the requisite information are fined heavily, with penalties that can go up to Rs. 5 lakhs.
The Benefits of Filing Annual Compliances For LLPs
- Stays Active and No Penalties:With regular filings, LLPs are not declared as defunct, and stays active. Also, annual compliance filings are mandatory and hence involve penalties (additional fees) to LLPs, when they default on filings.
- Record of Financial Worth:Annual compliance filings by LLP’s provide records to other companies regarding their financial worth, which may result in new and interested investors.
- Higher Credibility:Annual compliance provides for higher credibility to the organization for loan approvals or any other similar requirements.
- Conversion or Closure:Regular annual compliance filings facilitate easier conversion of Limited Liability Partnerships into other types of companies, as well as quicker resolutions in case of dissolution of partnerships.