Introduction
As Startup Founder / Business Owner / CFO of a Private Limited Company in India, it's very important to stay on top of the various statutory and legal compliance requirements mandated by the Companies Act, 2013 and other relevant laws. Balancing daily business operations with complex corporate compliance can be overwhelming for entrepreneurs so it is important to seek right professional guidance while gaining a foundational understanding of legal requirements. Timely compliance not only help you avoids costly penalties but also ensures your business operates smoothly and efficiently.
Today, In this comprehensive guide, we'll cover the essential compliances every Private Limited Company must adhere to in India.
Post Incorporation Compliances for PLC in India
| Compliance |
Description |
Forms |
Deadline |
| Declaration of Commencement of Business |
Companies with share capital must submit a declaration to the Registrar of Companies (ROC) confirming the receipt of subscription funds in their bank account post-incorporation. Essentially, it signifies the company's readiness to commence business activities. |
INC-20A |
Within 180 days of incorporation. |
| Statutory Auditor Appointment |
Sound financial management is essential for the long-term success of Indian businesses. Appointing a statutory auditor provides crucial certification of a company's financial health. |
ADT-1 Filing |
Within 30 days of incorporation. |
| Holding 1st Board Meeting |
Indian Private Limited Companies (PLC's) should convene an initial board meeting within their first month of incorporation. Key discussions during the meet will be the opening of a company bank account for share capital deposit, validation of the incorporation documents, examination of directors' declarations, and the process of issuing share certificates. |
NA |
Within 30 days of incorporation. |
| Company Misc |
Every business letter, envelope, invoice, and similar document must contain the PLC’s full name, CIN, registered office address, and contact details (telephone number and email address). |
NA |
As soon as the PLC is incorporated |
| Labour & Other Laws |
Obtaining registration under labour laws if applicable and other applicable laws |
NA |
As per applicable laws |
Director KYC's & Disclosures Compliances
| Compliance |
Description |
Forms |
Deadline |
| KYC Filing for Directors |
The DIR-3 KYC form requires email and mobile phone verification through OTPs. Any changes to a director’s email or phone number necessitate a new DIR-3 KYC filing. For other modifications to director details, such as address, a separate form, DIR-6, must be submitted. |
DIR-3 KYC / Web KYC |
Before 30th September of every year (Annual) |
| Disclosure of Directors’ Interest |
Indian company directors must annually disclose their financial interests, including directorships held in other companies, corporations, partnerships, and associations. |
MBP-1 |
Every First Board Meeting of the Financial Year (Annual) and whenever there is any change. |
| Disclosure of Non-Disqualification by Directors |
Company directors must file a “Director Non-Disqualification Disclosure” form |
DIR-8 |
At the time of appointment or reappointment |
Compliance regarding Financial Statements & Filings
| Compliance |
Description |
Forms |
Deadline |
| Financial Statements and Audit Report |
Indian companies must submit their annual financial reports within 30 days of their annual general meeting (AGM). These reports encompass the balance sheet, profit and loss account, cash flow statement, director's report, and auditor's report. However, mandatory electronic filing in the XBRL format for companies with a paid-up capital of at least Rs. 5 crore or a turnover exceeding Rs. 100 crore. |
AOC-4 / AOC-4 XBRL |
Within 30 days of AGM |
| Annual Return |
Indian companies must file an annual return each year, summarizing their activities from April 1st to March 31st. This comprehensive report includes details about the company's registered office, core business operations, subsidiaries, associates, shareholding structure, members, debenture holders, promoters, directors, key managerial personnel (KMP), board meetings, director and KMP remuneration, legal penalties and offenses, and compliance certifications. |
MGT-7 |
Within 60 days of AGM |
Compliances regarding Board Meeting and Resolutions
| Compliance |
Description |
Forms |
Deadline |
| Board Meetings |
Board meetings are pivotal forums where directors conduct regular discussions, key decision-making, and oversight of management, these meetings foster transparency and accountability, ensuring the company's direction aligns with its long-term goals. |
NA |
Minimum 4 meetings per year with max 120 days gap between meetings |
| Notice of AGM |
To convene an annual general meeting (AGM), companies must issue a formal notice as outlined in Section 101 of the Companies Act, 2013, and Secretarial Standard-II. This will ensure all shareholders receive timely information about the meeting, enabling them to participate effectively. |
NA |
21 clear days before AGM |
| Circulation of Financial Statements & Reports |
Circulation of Financial Statements & Reports |
NA |
21 clear days before AGM |
| AGM (Annual General Meeting) |
Annual General Meetings (AGMs) are yearly meetings mandated by the Indian Companies Act, 2013. |
NA |
Within 9 months from the first financial year-end and within 6 months from the financial year-end |
| Appointment/Resignation/Change in Designation of Director |
Any appointment, resignation, or change in a director's designation must be formally reported to the Registrar of Companies within 30 days. |
DIR-12 |
Within 30 days of appointment |
| Filing Special Resolutions (Board Report & Annual Accounts) |
Special resolutions are a stringent decision-making mechanism requiring a supermajority of at least 75% shareholder approval. They are mandated for critical corporate actions such as mergers, substantial asset disposals, or alterations to the company's capital structure. |
MGT-14 |
Within 30 days of AGM |
Income Tax Compliances
| Compliance |
Description |
Forms |
Deadline |
| Advance Tax Calculation and Payment |
Private limited companies must prepay a portion of their estimated annual tax liability through advance tax installments. This amount is calculated based on projected taxable income for the financial year (April to March) and the applicable tax rate. |
NA |
Quarterly: September 30th of the assessment year (following the financial year ending March 31st) |
| Income Tax Returns |
Private limited companies are obligated to file annual income tax returns. |
ITR-6 |
July 31st of the next financial year |
| Tax Audit (Only if Turnover exceeds Rs. 10 Crore) |
An annual audit conducted by a CA is essential for verifying the accuracy of a company's financial records and tax calculations. |
Form 3CA/3CD |
30th September of the assessment year |
| GST filing (if applicable) |
Private limited companies in India are required to register for Goods and Services Tax (GST) if their annual turnover surpasses Rs. 40 lakh for goods or Rs. 20 lakh for services within a state. Post-registration, regular GST filing becomes mandatory. |
GSTR-1, GSTR-3B, etc. |
Monthly Filing (for Turnover exceeding Rs. 1.5 crore) / Quarterly Filing (for Turnover between Rs. 40 lakh and Rs. 1.5 crore) |
| TDS/TCS (if any) |
Indian private limited companies act as tax collection agents for the government by deducting Tax Deducted at Source (TDS) on specific payments like salaries, rent, and professional fees. Additionally, they collect Tax Collected at Source (TCS) on certain types of sales. Companies must file TDS/TCS returns detailing the deducted or collected tax, payee information, and payment details if they have withheld any taxes during the financial year. |
Form 24Q, 26Q, 27EQ, etc. |
Due Date if 15th of next month completing the quarter |
Other Mandatory Compliances for Private Limited Company
| Compliance |
Description |
Forms |
Deadline |
| Delay in Payment to MSME Vendor |
The MSME Act mandates payment within 45 days of receiving goods or services, or 15 days without a written contract. Non-compliance results in penalties, including compound interest. |
MSME-1 |
Half-yearly (April-Sep: Oct 1st; Oct-Mar: April 30th) |
| Return of Deposits |
Private limited companies that accept public deposits must file an annual DPT-3 form detailing deposit activity with the Registrar of Companies by June 30th. |
DPT-3 |
Every year on or before 30th June |
| Active Company Tagging (Companies registered before Dec 31, 2017) |
Private limited companies incorporated before December 31, 2017, must complete the Active Company Tagging (ACT) process. |
INC-22A |
On or before 25th April 2019 (one-time filing) |
| Significant Beneficial Owner (SBO) Declaration (if applicable) |
Significant Beneficial Owners (SBOs) should fill this form with the Registrar of Companies. |
BEN-1 & BEN-2 |
Within 30 days from the date of receipt of declaration by SBO in form BEN-1 |
| Appointment of Company Secretary (if applicable) |
All listed companies and private limited companies with a paid-up share capital of Rs. 10 crore or more must appoint a whole-time company secretary. |
DIR-12 |
Within 30 days of appointment of Company Secretary |
| Maintaining Employee related Compliances like ESI, PF |
|
|
Annual |
Event Based Compliances
1. Change in Authorized or Paid-up Capital
| Compliance |
Description |
Forms |
Deadline |
| Change in Authorized or Paid-up Capital |
Reflects alterations in a company's financial structure. |
Form SH-7 (Increase in Authorized Capital)
Form SH-6 (Reduction in Authorized Capital)
Form MGT-14 (Increase or Reduction in Paid-up Capital) |
Within a specified timeframe after the decision is made. |
2. Allotment of new shares or transfer of shares
| Compliance |
Description |
Forms |
Deadline |
| Allotment of Shares |
Reflects the issuance of new shares to investors. |
Form PAS-3 |
Within 30 days of allotment |
| Transfer of Shares |
Reflects the change of ownership of existing shares. |
Form SH-4 |
Within 30 days of share transfer |
3. Giving Loans to other Companies - Disclosure in board meeting minutes and financial statement
4. Giving Loans to Directors:
- Disclosure in board meeting minutes and financial statements
- Compliance with related party transaction norms
5. Appointment of Managing or whole time Director and payment of remuneration - Form DIR-12 for appointment / cessation
6. Opening or closing of bank accounts or change in signatories of Bank account - Internal resolution and authorization
7. Appointment or change of the Statutory Auditors of the Company:
- Form ADT-1 for appointment
- Form ADT-2 for resignation
Note: The specific forms and timeframes may vary based on the nature of the company (public, private, one-person company, etc.) and the specific provisions of the Companies Act, 2013. It's essential to consult with a legal or tax professional for accurate guidance.
Additional Event-Based Compliances
- Change in registered office address: Form INC-22
- Change in company name: Form INC-22
- Conversion of company type: Specific forms based on the conversion type
- Amalgamation, merger, or demerger: Specific forms and procedures
Non-Compliance Penalties
Non-adherence to India's Companies Act regulations can result in financial penalties for both the company and its responsible members. These penalties often include monetary fines levied for the duration of the non-compliance period. Furthermore, delays in mandatory annual filings can incur additional charges. To avoid these financial repercussions, companies must prioritize timely compliance with all statutory requirements.
With Jordensky, business owners can effortlessly manage their company compliance requirements. Here's how we can assist:
Dedicated Compliance Manager - Benefit from a dedicated Compliance Manager as your single point of contact for all compliance matters. Receive expert guidance and support whenever you need it.
Comprehensive Accounting Services - Our team handles your company's accounting requirement, ensuring accurate financial records. We prepare comprehensive financial statements at the end of each financial year.
Expert Secretarial Services - Rely on us to manage your company's secretarial requirements. We conduct board meetings, prepare meeting minutes, and create essential reports like the Director's Report and Annual Report.
Timely MCA Annual Return Filing - We handle the preparation and filing of your company's MCA annual return by the September 30th deadline. Our experts ensure compliance with all regulatory requirements.
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