Post Incorporation Compliance for Public Limited Company
April 16, 2020
Post Incorporation Compliance for Section 8 Company
April 16, 2020
Does company with no transaction require to File ITR & Annual Compliance ?
Company registration is first step of your startup journey. Many startups register a company but may not initiate transaction in company. Some of time reasons are losses , lack of funding in company etc. Once a company is registered , directors need to maintain its annual compliances. As a business owner director must be having questions as Does company with no transaction need to File income tax return ? Company with no transactions need do company annual filing ? Does audit is compulsory for Nil transactions in company ?
For above question answer is Yes. Company with no transaction requires to file ITR & Annual compliances. As a Government officer they want reporting of company with filing of compliance’s. The reporting can be with number or zero. By filing compliances for non transaction , MCA will come to know status of company. Such filing is needed to keep status of company active with MCA. Following are compliances filing is required even for Company with no transaction.
There are 3 Parts of Annual Compliance of a Company
- Statutory Audit by CA
- Income Tax Return Filing
- Company Annual Filing compliance
1# Company Audit by CA
As per Section 139 of Companies act 2013 every company Incorporated under Companies Act 2013, get its accounts audited by Charted Accountant. Under statutory audit company prepare financial statement of company and get these audited by CA. Even where company not having any financial transaction need to prepare financial statement. Appointment of auditor and getting books audited is mandatory compliance. Company need to follow 12 month ( April to March ) accounting period and close books on 31st March each year. However, for companies registered between January to March, it can be closed on the 31st March of next calendar. Company which even with no profit may consist of below transactions
- Capital Deposit by Promoter
- Preliminary Expenses
- Provision for Annual Compliances
- Office Rent
- Salary of director , employees
| Month of Incorporation | First Financial Year Closure |
| January – March, 2020 | 31st March, 2021 |
| April – December, 2019 | 31st March, 2020 |
| January – March, 2020 | 31st March, 2021 |
Company audit is mandatory for each company irrespective of its annual turnover or profit ration. For company audit , board need to appoint auditor. Once financial statements are ready company can proceed to Annual Income Tax Filing.
2# Income Tax Filing
Under Section 139(1), in the following cases the filing of Income Tax Return is Mandatory for Any private, public, domestic or foreign country located and/or doing business in India. Hence Company having no transaction or profit still need to file annual income tax return. Every company registered before March , need to file income tax return. For FY 2019-20 income tax return filing date is 30th September 2020. Where company dose not file income tax return late fees upto Rs. 10000/- shall be applicable. The late fee is INR 1,000 for small business having with an income up to INR 5 Lakh. Where company have losses and file ITR within due date then company can carry forward losses to setoff with next years profit.
- Due date 30 September
- For non filing late fees upto Rs. 10000/- applicable
- To Carry forward loss ITR filing in time is important
3. Annual Compliance
As per companies Act each company need to follow compliance such as filing of financial statement , filing of annual return, auditor appointment etc. For meeting these annual compliance company need to held meetings , pass board resolutions etc. Once company closes its financial year company need to submit annual filing returns to MCA.
Private Limited company annual filing forms are AOC 4 , MGT-7 and ADT-1. In AOC-4 company submits information of its financial statements. In MGT-7 company submits its annual return and ADT-1 is required for auditor appointment in company.
| Compliance Details | Due Date of compliance | Due date for F.Y. 2019-20 |
| Annual General meeting | Within 6 months of Financial Year End*(Gap between two AGM shall not exceed 15 months) | 30th September, 2020(or within 15 months of previous AGM) |
| Auditor Appointment | Within 15 days of AGM held | Not later than 14th October, 2020 |
| AOC-4 (filing financial statements) | Within 30 days from the conclusion of the AGM | 29th October, 2020 |
| MGT-7 (filing annual return) | Within 60 days from the conclusion of the AGM | 28th November, 2020 |
Consequences for Company Annual Filing non Compliance
As like income tax return company annual filing is mandatory even where company having no transactions.
- late Filing Fees of Rs. 100 per day for delayed filing
- Directors disqualification & can lead to strike off company
- On failure to file the annual return of the company, the company is punishable with a fine not less INR 50,000 and which may extend to INR 500,000.
- Further, the office in default (director) is also punishable with the same fine or imprisonment of a term which may extend to 6 months or both.
Company directors are responsible for company operation , decisions and executions. Its better to file annual compliance for Private limited company rather than paying later late filing fees. Company with no transaction may choose to file annual return within time to avoid further late filing fees. Even when company wish to windup , annual filing helps to close company at peace.
We provide company annual filing services for Private Limited , One person and LLP. The team of Company Secretaries and Chartered Accountants are here to help you from accounts, audit to annual compliance. Send us your requirement at office@anbca.com and best services.
