All companies registered under the Companies Act, 2013 or earlier like private limited company, one person company, limited company, and section 8 company is required to file MCA annual return and income tax return for each year irrespective of the fact whether they are working or not. Section-8 Companies are required to conduct an Annual General Meeting at the end of each financial year and file financials and annual return with the Ministry of Corporate Affair to maintain compliance.
What is Section-8 Company?
A Section 8 company is a non-profit organisation formed with the objective of promoting commerce, arts, science, sports, education, research, social welfare, and protection of the environment. in a country. Though they are authorized to run a business and earn a profit, the profit can only be utilized for meeting company objectives, and cannot be shared among the members.
Annual Compliances of Section-8 Companies
A Section 8 company is required to adhere to the compliance levied by Registrar of Companies (ROC) and Income tax authorities. Failure to fulfil their compliance requirements results in paying heavy penalties, and chances are such organizations and their directors’ may even get disqualified for a period of time.
- Appointment of An Auditor: Under section 139 of the Companies Act 2013, it is mandatory for companies to appoint an auditor. The book of accounts and annual returns of the company shall be audited by the statutory auditor who will be appointed for a period of 5 years.
- Maintenance of Statutory Registers: The company is required to maintain a statutory register consisting of members, loans obtained, charges created, its directors, etc. as enumerated under section 8 of the companies act 2013.
- Convening Meeting: Annual general body meeting is to be conducted once a year within 6 months of the end of financial year and other board meetings have to be conducted.
- Boards’ Report: The Board of Directors of the company shall file their boards’ report in an appropriate manner, consisting of all the financial statements and other annexures. The board report is required to be filed in Form AOC-4.
- Financial Statement of The Company: The company will get the balance sheet, profit and loss A/C, cash flow statement and other financial statements prepared by the statutory auditor which is to be filed with ROC.
- Income Tax Returns: The ITR is required to be filed at the end of every assessment year, before 30th September.
- Filing of Financial Statements: The financial statement shall be filed in the appropriate form ( E-FORM AOC-4), within 30 days from the date of annual general meeting,
- Filing Annual Returns: The annual return containing all the information like management details, shareholders’ details will be filed in Form MGT-7 with Registrar of Companies (ROC), within 60 days of the annual general meeting.
Due dates for filing Section 8 Company Compliances
Section 8 Company should follow the annual compliances within the below mentioned time:
|Form No||Compliance||Due Date||Last Date|
|AOC-4||Directors Report||Within 30 days of the Annual General Meeting||29th October|
|MGT-7||Annual Returns||Within 60 days of the Annual General Meeting||28th November|
|Form ITR -6||Income Tax Returns||30th September||30th September|
What is the benefit of following annual compliance of Section 8 of the Company?
The basic reason for meeting the compliance of Section 8 Company is to avoid penalties. Also, it ensures the smooth functioning of the company. Below are some of the listed points:
- Better Credibility of the Companies.
- Avoid getting into any legal trouble.
- To build trust amongst the customers.
- To avoid penalties.