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Tax and Regulatory compliances for a Private Limited Company

Tax and Regulatory compliances for a Private Limited Company

What is a Private limited company

A Pvt. Ltd. Co. is a artificial judicial person registered under The Indian Companies Act, 1956 with

  • a minimum share capital of Rs. 1 Lakh and
  • At least 2 directors.

A Pvt. Ltd. Co. is required to get their books of accounts audited and file the Income Tax Returns and Registrar of Companies (ROC) Compliances every financial year irrespective of the size and nature of the company. There are Penal Provisions if such compliances are not made and the department is very stringent nowadays.

This write up will throw light on annual Tax and regulatory compliances which a Private Limited Companyneeds to undertake. Tax and Regulatory compliances for a Private Limited Company

Statutory Company Audit
Statutory Audit means which is Audit which is prescribed by a Statute i.e. The Indian Companies Act, 1956. Statutory Company Audit is an Audit of books of accounts of the company done by a practicing Chartered Account stating true and fairness of the books of accounts.

It is mandatory for every company incorporated under the Indian Companies Act, 1956 to get its annual accounts audited. There is no such due date for getting the Statutory Audit done by the Companies Act but the Act is very clear to hold an AGM within 180 days from the end of the financial year and present the audited accounts. Tax and Regulatory compliances for a Private Limited Company

Penal Provisions: Penalty up to Rs. 5000 may be levied on every director or officer of the company.
Tax Audit under The Income Tax Act, 1961
where the gross turnover of the company is equal or greater than 1 Crore, the Company is required to get Audit done as prescribed under The Income Tax Act, 1961. T

The company is required to file tax audit report in form 3CA with the Income Tax Department before the due date i.e. 30th Sep.

Penal Provisions

penalty @ 0.5% of turnover, subject to a maximum limit of Rs 1 lac.

Income Tax Return Filing
As per the Income Tax Act, 1961 every company is required to file their income tax return before 30thSeptember. A Pvt. Ltd. Co. is required to fill ITR-6 form electronically using digital signature. No ITR will be acceptable unless a digital signature is attached to it. The digital certificate while filing return should be that of the authorized signatory that i.e., in case of Company, Digital Signature Certificate of Managing Director or Director of the company. Tax and Regulatory compliances for a Private Limited Company

Penal Provisions: Penalty can be levied up to Rs. 5,000 for non-filing of tax return us 271F

ROC Annual Compliances
Every Company is mandatorily required to provide financial and other details of the company on a annual frequency. Registrar of Companies (ROC) is the official agency that deals with administration of Companies Act 1956 and it falls under Ministry of Corporate Affairs.

The below mentioned forms are to be filed:
Form 23AC : filing of Balance Sheet by all Companies
Form 23ACA : filing of Profit & Loss Account by all Companies
Form 20B : filing of Annual Return by Companies having share capital
Form 66 : filing of Compliance Certificate by Companies having paid up capital of Rs. 10 lakh – Rs. 2 crore 
Form 21 A : 
filing Annual Return by Companies not having share capital

Form 66, 23AC, 23ACA should be filed within 30 days from the date of AGM. Form 20B should be filed within 60 days from the date of AGM. Tax and Regulatory compliances for a Private Limited Company

Penal Provisions: Penalty up to Rs 5000 per form for companies.
Holding of AGM
A newly incorporated Company is required to hold its First Annual General Meeting hold its first annual general meeting within a period of eighteen months from the date of its incorporation and if such general meeting is held within that period, it shall not be necessary for the company to hold any annual general meeting in the year of its incorporation or in the following year.

In all subsequent years, the company is required to hold an AGM within six months from the end of the financial year i.e. 30th September. This is prescribed us 166 of The Indian Companies Act, 1956.

Penal Provisions: Penalty up to Rs. 50000 may be applicable to the company and every officer in charge of the company. In case of continuing default a penalty of Rs. 2500 per day may be applicable.

Tax and Regulatory compliances for a Private Limited Company

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