A clear comparison of Annual compliance for OPC and LLP
One Person Company and Limited liability partnership are two
of the most common business entities that prevail in India. Both of them have a
set of rules and compliances that need to be followed in order to run the
business smoothly without any worries and legal matters. There are many major
differences in the Annual
compliance for OPC and that of an LLP. Here, we will discuss the end to
end compliances that are required for both the entities along with various
regulations and laws required to govern them
One Person
Company
The OPCs work according to the Companies Act, 2013 and all
the associated rules. Starting from maintaining the accounts books to the
composition of annual financial statements and getting various events approved
for the company by conducting general meetings and board meetings are some of
the major Annual
compliances for OPC.
Limited
Liability Partnership
Similar to OPC, there are important Annual
compliances for LLP as well that a company has to abide by. There are
major statutory requirements as per the Limited Liability Act 2008 and all its
regulations. All the company accounts along with a record of partner meetings,
partner change or adding of the new member and the agreement signed by all
members need to be prepared by the legal advisory on a regular basis.
Major list
of compliances
It is crucial to have complete knowledge about all the major
compliances so that you never get stuck between any legal matters and pay high
penalties. Let’s take a look at all the key compliances that LLP and OPC need
to adhere with in details:
·
Minimum
requirements for formation
The OPC can be started by one person who can act both as the shareholder
and the director.
For LLP, a minimum of two people is required.
·
Maintenance
of accounts books
This is mandatory for both OPC and LLP.
·
Maintenance
of basic statutory records
For OPC, it is mandatory to maintain the records of minutes
of general meetings and board meetings and share certificates.
LLP needs to maintain the minute book in order to record all
meetings held among the partners.
·
Board
meetings
For OPC, if there is only one director in the company, no
board meetings are required. If in case there are more than 1 director, it is
required to have the first meeting within 30 days of company incorporation.
Also, it is mandatory to have at least one meeting at every half of the
calendar year and there should be gap no lesser than 90 days between every two
consecutive meetings.
For LLP, no meetings are mandatory. There can be certain
meetings held according to the LLP act including change in LLP objects, the expulsion
of any partner or admission of a new person etc.
·
Annual
general meetings
No AGM required for OPC as well as LLP.
OPC needs to mandatorily file form AOC-4 with details of the balance
sheet, cash flow statement, change in equity statements and profit and loss
details. The annual return has to be filed via FormMGT-7.
E-form 8 has to be filed by LLP for account statements and
solvency statement. Annual return has to be filed via e-Form 11.
·
Annual tax
filing
The tax return has to be filed in form ITR-V1 for OPC.
The tax return has to be filed in form ITR-V for LLP.
·
Statutory
Audit
It is mandatory for OPC.
For LLP, it is required when turnover crosses 40 Lakhs or if
the contribution is above 25 Lakhs.
·
Tax audit
It has to be done for OPC and LLP when the turnover crosses
one crore.
These are some of the key Annual compliances for LLP and OPC which an organization needs to
follow strictly.
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