Annual Compliance for One Person Company2022-09-26T12:55:01+05:30

Annual Compliance for One Person Company (OPC)

Annual Compliance for One Person Company (OPC) includes carrying out all mandatory legal compliances with various government authorities like MCA, Income Tax Department, GST Department, etc. as per various laws.

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    Annual Compliance for One Person Company (OPC)

    A-One Person Company (OPC) is formed with only a single person as a member under the Companies Act 2013 which has to comply with different laws provided by authorities such as the Ministry of Corporate Affairs (MCA), Income Tax Department, GST Departments etc. Annual Compliance is all about book-keeping and accounting, auditing, holding meetings of directors and members, regular filing of annual returns, financial statements, Directors KYC, payment of taxes, and other compliances as required from time to time. Every OPC incorporated in India irrespective of its size and turnover has to carry out annual compliances as applicable to it.

    An OPC is required to manage various operations in day-to-day business in line with the complicated corporate and tax laws, which can be a difficult task. Therefore, it is advisable to carry out various activities under the guidance of a professional for understanding the legal requirements and timely fulfilment of the compliances so as to avoid penalties and fines.

    What is the Due Date for Annual Compliance for One Person Company (OPC)?

    The due date for filing forms and returns with authorities are different for each form and returns. Below table shows the illustrative list of applicable due dates on the company.

    Purpose of Form Due Date
    Form DPT-3 – Return of Deposits 30th June after the end of financial year
    Form DIR-3-KYC – KYC of Directors 30th September after the end of financial year
    Form ADT 1 – Appointment of Auditor Within 15 days from the date of appointment or Annual General Meeting (AGM)*
    Form AOC – 4 – Filing of financial statement and other documents with the ROC Within 180 days from the closure of financial year
    Form MGT-7A – Filing of annual return with the ROC Within 60 days from the date of Annual General Meeting (AGM)* or completion of 180 days from the end of financial year
    Income Tax Return (ITR) of Company 30th September of relevant Assessment year

    Advantages Of Annual Compliance for One Person Company (OPC)

    • Avoid Heavy Penalty

      Statutory compliances are to be mandatorily followed under law, if a company does not follow the compliances regularly or doesn’t file required returns within the specified time period then the government charges heavy penalties on the company and its directors. Therefore, filing various compliances on time will help the company to avoid heavy penalties, as the cost of non-compliance is always greater than the cost of compliance.

    • Get easy loan, finance, and subsidies

      The company’s credibility and reliability are measured by the financial statements and regularity of compliances. The company with a good track record can easily approach government and private organizations for loans, financial assistance, subsidies, tenders, and other similar purposes based on its established credibility, reliability, and reputation.

    • Necessary for Active status of Company

      If a company fails to comply with the compliance requirements under Companies Act, then apart from heavy penalties the Registrar of Companies (ROC) shall also declare the company as a defunct company and remove its name from the register, after which the company losses its existence and becomes ineligible to carry out further business operations.

    • Builds Trust of Customers

      Nowadays, not only business peers but also customers check and verify the status of compliance of an organization before entering into a transaction with them. Therefore, a Compliant OPC will always build the trust of potential customers and gain their confidence.

    What Is Included In Our Annual Compliance for One Person Company (OPC) package?

    • Share certificates to initial shareholders

    • Filing Declaration of Commencement of Business (INC-20A) for the Company.

    • Appointment of a Statutory Auditor for the Company

    • Accounting and Book-keeping of the Company

    • Preparation of Financial Statement such as Balance Sheet, Profit & Loss Account, Cash Flow Statement etc.

    • Calculation and Assessment in of Income Tax and Filling of respective Income Tax Return (ITR)

    • Issuing Audit Report

    • Preparing Board’s report, Annual return, list of shareholders and directors

    • Preparation of Board Meeting and Annual General Meeting (AGM) resolutions

    • Filling of ROC forms ADT 1, AOC 4, MGT 7 with their respective attachments.

    • Filing of Form DIR-3-KYC certified by a Professional

    • Advisory and Consultation with respect to miscellaneous corporate law matters.

    Documents Required for Annual Compliance of One Person Company (OPC)

    • Certificate of incorporation of Company

    • Memorandum of Association (MOA) and Article of Association (AOA)

    • GST Certificate (if registered under GST)

    • Bank Account Statements of Company for the relevant Financial year

    • Sale/Purchase/Expense/Payment invoices and receipts

    • Digital signature of the authorized director of the company

    • Other information and documents as may be necessary

    Process of Annual Compliance for One Person Company (OPC)

    • Collection of required Information and Documents

      In the first step, we shall collect the required information and documents required as per the checklist. We shall verify and confirm the documents and information provided.

    • Allocation of a Dedicated Compliance Professional

      Once we receive the information and documents, we shall then allocate a dedicated compliance professional who will understand your business model and provide a list of required compliances applicable to the company.

    • Carrying out Compliance Process of the Company

      Our representative shall carry out the preparation and finalization of various documents, forms, statements, and returns as per the compliance requirements of the company.

    • Submission of Forms and Returns

      After the forms and returns are prepared and finalised, it shall be signed by directors and Practicing Professional and shall be submitted to the government authorities for approval purposes, after which an Acknowledgement Number shall be generated.

    • Get approval in few days

      Once the form is successfully approved by the respective authorities, you shall receive the mail of approval within few days from the government.

    Consequences of Non-Compliance by the One Person Company (OPC)

    Payment of Additional Fees on Delayed Filings

    If the company fails to file the Form AOC-4 or MGT-7 within the required time period, and files the same after the due date, then it shall be liable to pay the additional government fees of 100 per day per form. For other forms, it shall vary from 2 times to 12 times of the normal government fees, depending on the delayed time period.

    Penalty on Company for default in filing Annual Return and Financial Statement

    If the company fails to file financial statement and annual return in Form AOC-4 and MGT-7 within the required time period, then it shall also be liable to a penalty of Rs. 10,000 which shall extend to Rs. 2 lakhs, with further penalty of Rs. 100 for each day.

    Penalty on the Officer who is in default in filing Annual Return and Financial Statement

    If the company fails to file financial statement and annual return in Form AOC-4 and MGT-7 within the required time period, then the officer who is in default or the directors shall also be liable to a penalty of Rs. 10,000 which shall extend to Rs. 50,000, with a further penalty of Rs. 100 for each day.

    Company liable for Strike Off or Closure by ROC

    If the company does not file a financial statement and annual return to the ROC for a period of 2 years and if the ROC believes that the company is not carrying on any business or operation, then it shall send a notice to company/directors and remove its name from the Register of Companies (ROC)

    Disqualification of Director

    If a Company does not file financial statement and annual return for a continuous period of 3 years, then the Directors of such company shall be disqualified from being appointed as Director in any company for a period of 5 years.

    Penalty for Not Filing Income Tax Return (ITR)

    As per Income Tax Laws, if company files ITR after the due date then a penalty of Rs. 5000 to 10,000 shall be payable by the company. Further, company won’t be able to carry forward or set off your losses to subsequent years.

    FAQ

    Do I need to be physically present during this process?2021-10-28T10:05:18+05:30

    No, the process of annual compliance is a completely online process. All the required forms and returns are filed electronically, so you would not need to be physically present at all. You would just need to send us scanned copies of all the required documents and information.

    My OPC has not done any business during the year, do I still need to file the annual returns?2021-10-28T10:04:57+05:30

    Yes, even if there is loss / no business in the company during the year, the filing of annual returns along with Income Tax Return (NIL) and such other applicable compliances are required to be filled by the OPC.

    What is a financial year in terms of annual compliance?2021-10-28T10:04:37+05:30

    The financial year shall mean the period ending on 31st March of the year. For Example, if a company is registered on 22nd April 2020, then its first financial year will end on 31st March 2021 (i.e., FY 2020-2021). For companies registered on or after 1st January onwards, then its first financial year will end on 31st March of the subsequent financial year. For Example, if a company is registered on 22nd January 2020, then its first financial year will end on 31st March 2021.

    Is the appointment of an auditor mandatory for OPC?2021-10-28T10:04:14+05:30

    Yes, every OPC is mandatorily required to appoint an Auditor within 30 days from the date of company registration. The company may appoint an auditor at the Annual General Meeting (AGM) for a period of 5 years.

    Are audited financial statements mandatory for annual filling?2021-10-28T10:03:02+05:30

    Yes, the OPC has to file audited financial statements with the government authorities.

    I have not filed annual ROC returns for the past financial year, whether my company is eligible to file annual returns in the current financial year?2021-10-28T09:55:45+05:30

    Yes, the company can file the pending annual returns in the current financial years with payment of applicable additional fees and penalties.

    Whether board meetings and annual general meetings are mandatorily required to be held by the OPC?2021-10-28T09:55:20+05:30

    Yes, as per the Companies Act 2013 and other applicable rules, there must be atleast one board meeting conducted in each half of the calendar year and the gap between 2 meetings should be atleast 90 days. However, it is not mandatory for the OPC to conduct Annual General Meeting (AGM).

    What is the purpose of Form ADT-1, Form AOC-4, and Form MGT-7A?2021-10-28T09:54:46+05:30

    Form ADT- 1 is an E-Form that is used by the company to intimate the Registrar of Companies (ROC) about the appointment of an auditor. Form AOC-4 is used for filing financial statements, board report, and other documents with ROC. Whereas, Form MGT-7A is used for filing annual return details to the ROC.

    Is Income Tax Return (ITR) mandatory to be filed every year by Companies?2021-10-28T09:54:21+05:30

    Yes, Income Tax Return (ITR) is mandatory to be filed by every company, irrespective of income or loss during the financial year.

    Is DIR-3-KYC form to be filed every year?2021-10-28T09:53:49+05:30

    Yes, DIR-3-KYC has to be filed every financial year by 30th September of next financial year, and it is valid till 31st March of such financial year

    What is Form DPT-3?2021-10-28T09:53:18+05:30

    DPT-3 is a Return of deposits is required to be filed every year by companies furnishing information about outstanding deposits and/or particulars of transactions not considered as deposits to the Registrar of Companies (ROC)

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