Compliances for a Private Limited Company in India for FY 2023-24

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Compliances for a Private Limited Company in India for FY 2023-24

A private limited company is one of the most popular forms of business entities in India. It offers limited liability, perpetual succession, and easy transferability of shares. However, it also comes with certain statutory obligations and compliances that need to be fulfilled by the company and its directors. Failing to comply with these requirements can result in penalties, fines, or even prosecution.

In this blog post, we will discuss the various compliances that a private limited company in India has to adhere to for the financial year 2023-24. These include:

• ROC (Registrar of Companies) Compliances

• Income Tax Compliances

• GST (Goods and Services Tax) Compliances

• TDS (Tax Deducted at Source) Compliances

• Other Compliances

ROC Compliances

ROC is the authority that regulates the functioning of companies in India. It is responsible for registering, maintaining, and dissolving companies. ROC also monitors the compliance of companies with the provisions of the Companies Act, 2013 and the rules made thereunder.

Some of the important ROC compliances that a private limited company has to follow for FY 2023-24 are:

• Annual Return Filing: Every company has to file its annual return in Form MGT-7 within 60 days from the date of its annual general meeting (AGM) or within 60 days from the last date before which the AGM should have been held. The annual return contains information such as the share capital, directors, shareholders, loans, etc. of the company for the financial year.

• Financial Statement Filing: Every company has to file its financial statements in Form AOC-4 within 30 days from the date of its AGM or within 30 days from the last date before which the AGM should have been held. The financial statements include the balance sheet, profit and loss account, cash flow statement, and notes to accounts of the company for the financial year.

• Appointment of Auditor: Every company has to appoint an auditor for a term of five years in its AGM and file Form ADT-1 within 15 days of the appointment. The auditor is responsible for auditing the books of accounts of the company and expressing an opinion on the true and fair view of the financial statements.

• Return of Deposits: Every company that has accepted deposits from the public or its members has to file a return of deposits in Form DPT-3 by 30th June of every year. The return of deposits contains details such as the amount of deposits, interest, repayment, etc. of the company for the financial year.

• Directors’ KYC: Every director who holds a Director Identification Number (DIN) has to file his or her KYC details in Form DIR-3 KYC by 30th September of every year. The KYC details include the personal information, address, and identity proof of the director.

• Event-Based Filings: Apart from the annual filings, a company also has to file certain forms with the ROC whenever certain events or changes occur in the company. For example, if a company changes its name, registered office, share capital, directors, etc., it has to file the respective forms with the ROC within the prescribed time limit.

Income Tax Compliances

Income tax is the tax levied on the income earned by a person or an entity in a financial year. A private limited company is liable to pay income tax on its net profits at the rate of 25% or 30%, depending on its turnover in the previous year. A company also has to pay a surcharge and a cess on the income tax, as applicable.

Some of the important income tax compliances that a private limited company has to follow for FY 2023-24 are:

• Tax Audit: A tax audit is an audit of the books of accounts of a company by a chartered accountant to verify the accuracy and completeness of the income and expenses reported by the company. A company has to get its accounts audited if its turnover exceeds Rs. 1 crore in the previous year or if it has opted for the presumptive taxation scheme under section 44AD or 44ADA of the Income Tax Act, 1961. The tax audit report has to be filed in Form 3CA/3CB and 3CD by 30th September of the assessment year.

• Income Tax Return Filing: An income tax return is a statement of the income and tax liability of a company for a financial year. A company has to file its income tax return in Form ITR-6 by 31st October of the assessment year. The income tax return has to be verified by the digital signature of the authorized person of the company.

• Advance Tax Payment: Advance tax is the tax paid by a company in instalments during the financial year, based on the estimated income and tax liability of the company. A company has to pay advance tax if its tax liability exceeds Rs. 10,000 in a financial year. The advance tax has to be paid in four instalments: 15% by 15th June, 45% by 15th September, 75% by 15th December, and 100% by 15th March of the financial year.

• TDS Payment and Return Filing: TDS is the tax deducted by a company at the time of making certain payments to other parties, such as salary, interest, rent, commission, etc. A company has to deduct TDS at the prescribed rates and deposit the same with the government by the 7th of the next month. A company also has to file a quarterly TDS return in Form 24Q/26Q/27Q/27EQ by the 31st of the month following the quarter. The TDS return contains the details of the TDS deducted and deposited by the company for the quarter.

GST Compliances

GST is the indirect tax levied on the supply of goods and services in India. A private limited company that is engaged in the business of supplying goods or services has to register under GST if its turnover exceeds Rs. 40 lakh (Rs. 20 lakh for special category states) in a financial year. A company that is registered under GST has to collect and pay GST on its outward supplies and claim input tax credit on its inward supplies.

Some of the important GST compliances that a private limited company has to follow for FY 2023-24 are:

• GST Registration: A company that is liable to register under GST has to apply for GST registration in Form GST REG-01 within 30 days from the date of becoming liable. The company has to provide the basic details, such as the name, address, PAN, bank account, etc. of the company and its promoters, directors, and authorized signatories. The company will receive a GSTIN (GST Identification Number) after the verification and approval of the application by the GST officer.

• GST Return Filing: A GST return is a statement of the GST transactions of a company for a tax period. A company that is registered under GST has to file various GST returns, such as GSTR-1, GSTR-3B, GSTR-4, GSTR-6, GSTR-7, GSTR-8, GSTR-9, etc., depending on the nature and turnover of the company. The GST returns have to be filed online on the GST portal by the due dates specified for each return. The GST returns contain the details of the outward supplies, inward supplies, tax liability, input tax credit, etc. of the company for the tax period.

• GST Payment: A company that is registered under GST has to pay the GST liability on its outward supplies after adjusting the input tax credit on its inward supplies. The GST payment has to be made online on the GST portal by the 20th of the next month. The company has to generate a challan in Form GST PMT-06 and pay the GST amount through net banking, debit card, credit card, NEFT, RTGS, or over-the-counter payment.

Other Compliances

Apart from the ROC, income tax, and GST compliances, a private limited company in India may also have to comply with some other laws and regulations, depending on the nature and sector of the company. Some of these compliances are:

• Labour Laws: A company that employs workers or employees has to comply with various labour laws, such as the Minimum Wages Act, 1948, the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952, the Employees’ State Insurance Act, 1948, the Payment of Bonus Act, 1965, the Payment of Gratuity Act, 1972, the Maternity Benefit Act, 1961, the Shops and Establishments Act, etc. These laws regulate the wages, benefits, working conditions, social security, etc. of the workers and employees of the company.

• Environmental Laws: A company that is involved in the production, handling, or disposal of hazardous substances or wastes has to comply with various environmental laws, such as the Environment (Protection) Act, 1986, the Water (Prevention and Control of Pollution) Act, 1974, the Air (Prevention and Control of Pollution) Act, 1981, the Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008, etc. These laws aim to protect and improve the quality of the environment and prevent and control the pollution caused by the company.

• Industry-Specific Laws: A company that operates in a specific industry