Annual Filing for LLP With No Transactions

Most of startups registered Limited Liability Partnership firm. However due to some reason partners fail to carry business activity in firm. In some time firm also fails to open a current bank account of LLP. This results on LLP with no sales , purchases , capital etc. transaction. In simple terms such LLP is not an active LLP in terms of financial transaction. Now most of partners may be having question as Do I Need to File LLP Annual return for LLP with no /Nil  transactions ? Is there any penalty applicable for non compliances ? Do I need to file Income Tax Return of LLP ?

Partners need to note that LLP Annual filing is compulsory even for LLP having no financial transaction , no profit in LLP. Unless LLP files its annual return department will not come to know where LLP is active of dormant. What are financial transactions of LLP. In this article we discussion about solution for LLP Annual filing for LLP having no financial transactions.

LLP Form 11 For LLP with LLP With No Transitions

An LLP registered after October has an option to choose its Financial Year. For LLP Act gives option to LLP to 18 month. i.e. if an LLP is incorporated after October, 2018 it can close its Financial Year in March, 2019 or March, 2020. Hence LLP registered before October 2018 In India need to file LLP form 11 even LLP having No transaction. LLP Form 11 is annual return need to file 60 days from end of financial year.

• Form 11 option for FY 2019-20 if LLP registered after October 2018
• Form 11 mandatory if LLP registered before October 2018
• Non filing Late fees Rs. 100 per day
• Applicable LLP NIL Turnover

Form 8 for LLP  with No Transactions

As explained above LLP can choose its first annual return. LLP registered after October 2018 have option to file or not to file form 8. However LLP Registered before October 2018 , Form 8 filing is mandatory even for NIL Transactions.

• Form 8 option for FY 2019-20 if LLP registered after October 2018
• Form 8 mandatory if LLP registered before October 2018
• Non filing Late fees Rs. 100 per day
• Applicable for LLP NIL Turnover

Income Tax Return for LLP with No transactions

Section 139(1) of Income Tax Act 1961 make Mandatory and Voluntary Income Tax Return filing. For any firm including LLP (Limited Liability Partnership) or Unlimited Liability Partnership Income Tax Return filing is mandatory even LLP having no turnover. To avoid Income tax non filing penalty of Rs.10000/- LLP should file annual return.

• Tax Filing applicable For all LLP
• For Non filing penalty upto Rs. 10000/-
• Due date of filing 31 July 2020 for FY 2019-20

Importance of Annual Filing For LLP Closing

Procedure for winding up of LLP is done through Form No. 24. LLP which not started business or have ceased it business activity can file this form 24. For LLP closure its important that LLP annual compliances such as Form 8 , Form 11 and Income tax return should be updated. In LLP closure form 24 its important to update information. In case where partners decide to close LLP in future then LLP must file annul return.

Penalty for LLP Annual Filing Non Compliance

For LLP annual non compliance penalty is applicable as per LLP Act 2008 and As per Income Tax Act 1961. These penalty late fees applicable irrespective of LLP having any turnover. In case LLP not having any turnover still it should file its annual return to avoid late filing penalty.